Ex-Spotify Economist Worried About Audiobook Royalties on Platform

Earlier this month, Spotify announced the addition of free audiobooks for Premium subscribers. But one former Spotify executive has concerns about how authors will earn royalties from the new feature.

Will Page, Spotify’s former chief economist, wrote a blog post on LinkedIn questioning the audiobook model on music streaming platforms. Page himself has an audiobook on Spotify called “Tarzan Economics.”

With the new rollout, Spotify Premium members in the UK and Australia can access 15 hours of audiobook listening per month at no extra charge. The feature is expected in the US soon.

But Page explains that authors earn painfully little from audiobooks compared to music streaming – around just 7% of revenues. He worries Spotify’s model of excerpted listening could undermine already slim audiobook royalties.

Page compares it to how songwriters earn royalties from music streaming. Play just 30 seconds of a song, and the songwriter gets paid. But audiobook royalty structure is less defined. If a user only streams one chapter, does the author still get paid?

He illustrates the problem: “What happens if you listen to fifteen different authors’ chapter one’s this month, and then the fifteen chapter two’s the next? Depending on the deal the publishers have made, that could mean 15 authors not getting any royalty from your listening.”

Page also points out the huge variation in audiobook length, from short stories to novels over 1,000 pages. Music track lengths have a much smaller range. So should royalties be weighted by book length?

In the world of audiobooks, Page says authors only get around 7% of revenues after publishers, retailers, VAT taxes, and agents take their cuts.

He argues this royalty reduction from excerpted listening could hurt authors: “If the author was expecting little to start with, then enabling ‘dipping’ into books further trivialises an already trivial reward for creativity.”

While Page believes Spotify has good intentions, he urges caution: “While Spotify has an admirable history of moving mountains to make music work, making books work is an entirely new peak to climb.”

The post sparked discussion on whether streaming platforms need to account for audiobooks’ unique economics compared to music. Unlike songs, authors spend years crafting books – will fractional listening undercut their creative investment?

It will be interesting to see how Spotify structures audiobook royalties as the program expands. Striking the right balance could encourage authors to embrace streaming while sustaining their livelihoods.

But Page argues Spotify must engage with authors to solve this royalty puzzle. Creators need assurance they will earn fair compensation as audiobook streaming grows.

Read Will Page’s full LinkedIn post for his in-depth analysis here. What do you think of Spotify’s audiobook rollout and royalty concerns? Share your thoughts below.