Spotify take their biggest step yet into audiobooks, with the acquisition of digital audiobook distribution company Findaway.
For the past few years, Spotify have heavily invested in podcasts with new original shows, and the acquisition of exclusives and podcast networks. This acceleration “to become the world’s leading audio platform” really took off with the purchase of podcast creation platform Anchor and podcast network Gimlet in 2019. Audiobooks have been Spotify’s last missing piece in their quest “to be the destination for all things audio for both listeners and creators.” The last year or two has seen Spotify slowly implement audiobooks onto the platform, but on a smaller scale, including an exclusive celebrity-narrated audiobook of Harry Potter and the Philosopher’s Stone and new recordings of classic books. Spotify have made no secret of their plans to step up audiobooks, last year posting a vacancy for Head of Audiobooks. This role was initially filled by former Audible exec Sean McManus, before being taken over by Anchor co-founder Nir Zicherman.
Findaway provide both consumers and B2B services, with distribution, production and development of apps and content for libraries and retailers. The audiobook company’s leading technology tools help independent authors to create and bring stories to life. With the largest catalogue of distributed titles, the acquisition should help Findaway quickly scale Spotify’s audiobook catalogue and produce new original ones. “We are excited to join Spotify to continue to innovate and democratize the audiobook ecosystem together.”
Spotify’s news article notes that the audiobook industry is expected to grow from $3.3 billion to $15 billion by 2027, with a large portion expected to be from audiobook subscriptions. The move will no doubt accelerate Spotify’s entry into the rapidly growing audiobook industry, enabling faster innovation and bringing audiobooks to their over 380 million users around the world. The partnership will also provide new avenues for publishers, authors and independent creators to reach new audiences, with help from Spotify’s world-class personalization and discovery knowledge, as well as innovation on format, delivery, creator tools and more. Spotify say they hope to remove any current limitations and bring better economic tools for creators.
Spotify’s purchase of Findaway for an undisclosed amount is expected to close before the end of the year, subject to regulatory review and approval. Findaway will continue to operate out of its headquarters in Solon, Ohio, lead by Founder and CEO Mitch Kroll, who will now report to Zicherman.
This acquisition poses some interesting questions that only time will answer. Can Spotify have the same effect with audiobooks as they had with music and podcasts? Spotify may find this task more challenging than they did with podcasts, as that market was fairly scattered between multiple platforms. Can they take on the behemoth in audiobooks that is Amazon’s Audible? We’re not sure how audiobooks will be implemented or monetized on Spotify. The few audiobook we have seen have been bundled in with podcasts, but will we see the podcasts feature broaden its title to “spoken word” or will we see a new branch specifically for audiobooks? Audible have two key plan for subscriptions: Audible Premium offers a number of credits to purchase any of their books for a monthly fee, while Audible Plus offers all-you-can-listen to a smaller selection of books. How will Spotify approach audiobooks and will they offer an ad-supported free model?
Spotify’s push into podcasts did cause some concern from labels and musicians, that spoken-word content could eat into music listeners. Spotify argues the new avenues increase engagement and loyalty across the app.
It is Spotify’s ambition to be the destination for all things audio both for listeners and creators. The acquisition of Findaway will accelerate Spotify’s presence in the audiobook space and will help us more quickly meet that ambition. We’re excited to combine Findaway’s team, best in class technology platform, and robust audiobook catalog, with Spotify’s expertise to revolutionize the audiobook space as we did with music and podcasts.Gustav Söderström, Chief Research & Development Officer, Spotify
Together with Spotify we have the opportunity to innovate and democratize the audiobook ecosystem. We founded Findaway with the recognition of the power of the spoken word through audiobooks and the unique opportunity to empower storytellers and connect them with listeners. We look forward to combining our leading technology tools and world-class team with the reach of Spotify’s platform to provide an enhanced audio experience for creators, publishers and listeners around the world.Mitch Kroll, Founder & CEO, Findaway