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Amazon snaps up Audible for $300m

updated 08:20 am EST, Thu January 31, 2008

Amazon Acquires Audible

Amazon today said it would acquire Audible in a share buyout deal worth roughly $300 million. The agreement effectively gives Amazon control of Audible's audiobook collection and is described as an effort to develop and expand the audiobook forrmat, which is largely dominated by the now-acquired company. The finished deal is expected to be approved sometime during the spring of this year.

Amazon has not announced any of its immediate plans for Audible but is likely to have a major effect on the audiobook industry. The former's Kindle e-book reader is currently focused on text and supports both Audible and MP3 audiobooks. However, it is unclear whether Amazon will port Audible's books to its own store with its own format, alter the store to support MP3s (similar to its music store), or leave the book service unchanged.

Amazon has also declined to say whether Audible will continue to support third-party companies such as Apple, who have integrated the Audible format into devices such as the iPhone and iPod as well as online stores such as iTunes. The latter depends exclusively on Audible support for the audiobook section of its online service.



By Electronista Staff
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  1. MhzDoesMatter

    Fresh-Faced Recruit

    Joined: Jul 2002

    0

    Wow

    That could play out interestingly for iTunes. Not to be a fan boy but I rarely used Audible before iTunes added a certain level of integration. But even if thats the case for most people. Amazon may be one of the few sites that can drive enough of their own traffic to offset any lost by perhaps cutting iTunes and the iPod out of Audible content.

    Personally, I'd let both stay and just enjoy the revenue stream instead of trying to reinvent the ipod/wheel for audiobooks and possibly drive Apple to consider going directly to publishers and creating yet another near monopoly in a media industry.

  1. slider

    Mac Elite

    Joined: Oct 1999

    0

    Not Gonna Happen

    I have an audible account. Amazon is not going to cut out the iPod as it's worked in with their system. Don't know about iTunes, though I doubt Amazon would cut a profit area just to snub Apple.

  1. Rezzz

    Fresh-Faced Recruit

    Joined: Jan 2006

    0

    wouldn't be surprised...

    wouldn't be surprised...to see Amazon drop iTunes support at the end of the current contract (assuming there is one). Amazon wants Apple's distribution business. To get it they are differentiating themselves. Aside from the record companies giving everyone (accept Apple) DRM-free downloads, this would be another means to provide value that Apple could no longer supply in an attempt to drive users to their service.

    the income loss they would see from dropping itunes would be considered a loss leader in order to pickup sales in the true strategic areas: music & video.

  1. danviento

    Fresh-Faced Recruit

    Joined: Dec 2005

    0

    @drop believers

    Say amazon does drop support for iTunes and thereby the iPod. Where else are the people that buy into Audio books going to play their content? No player is anywhere close to being as widespread as the iPod, and I find it hard to believe that there are many people who are going to listen to audio books on their computer.

    From what I can tell, the main market use for audio books is in those who drive or take mass transit, so even laptops wouldn't be a boost in terms of playable devices. As for CD's, I have no clue what the size of the user base that burns the content to disc to use in the car is, but I wouldn't think it'd be that large. If you're one who actually listens to audiobooks that you download, you're usually tech savvy enough to buy an iPod, or some form of player. For that matter, if you're savvy enough to DL your audiobooks, you can export it out to an iPod-friendly format.

    No, I doubt Amazon is silly enough to canabalize their customer base by cutting out the main player that people use to listen to that kind of content. As for them coming up with their own player, we saw how well the Kindle turned out. *shudders* ...ugly thing... They'll leave the R&D of players up to the big boys and at least try to play nice with Apple on this issue.

  1. jhawk95

    Fresh-Faced Recruit

    Joined: Oct 2006

    0

    Anti-trust Lawsuit!

    If Amazon is allowed to buy Audible and then cuts Apple out there would most likely be an anti-trust / anti-competitive lawsuit.

    It would be illegal for Amazon to stifle competition in that market.

  1. mpetrides

    Fresh-Faced Recruit

    Joined: Aug 2002

    0

    No iPod, Audible begone..

    I've been a loyal (some would say, fanatic) subscriber to Audible since the very beginning and I can tell you, if Audible stops supporting the iPod, I won't be staying with Audible.

    Frankly, I can not see that happening. Like the old Campbell Soup commercial says: Audible and iPod, go together like a horse and carriage.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    come on people

    Gotta love over-the-top speculation.....

    Couple of things to keep in mind:

    1) People seem to be mixing the iTMS with the iPod. Note that they are NOT the same.

    2) The only way Audible content would no longer work on the iPod is if they changed the DRM used by their content (which I don't believe is even fairplay).

    3) Amazon's current strategies are in the DRM-free context, so I doubt they'd do #1. They might change it over to MP3 files or the like, however, which would still work on the iPod.

    4) I don't care how stupid you are (and Amazon isn't stupid), you're not going to just close up a good hunk of your business (the iPod users). Sure, the labels might do this, but since downloads have such a small marketshare, it's not that much of a loss (now, if a label decided to drop CD sales, that would be a deathknell).

    5) Amazon/Audible don't own the rights to the books, they just have distribution rights, which means it's in their best interests to make the content as available as possible. For the publishers can easily go "Hey, we're no longer available for iPods. We're going to give our audio rights to the Jobs' Audiobook Co., who will give us a wider audience!"

    So, basically, any concerns are pretty limited.

  1. slider

    Mac Elite

    Joined: Oct 1999

    0

    RE: come on people

    That's right, it makes no sense to think that if Audible (Amazon) stops selling audio book content on iTunes it would make the content unplayable on the iPod. After all, one of the big selling points of Amazon's online music store is that it works with iPods. I don't even use the iTunes store, I download my right from Audible.

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