Spotify to Acquire an Audiobook Company

Spotify has announced plans to acquire audiobook services and distribution company Findaway for an undisclosed price. The company operates multiple businesses, including distributing audiobooks to various platforms and offering audiobook creation services under its Findaway Voices business. The company pairs authors with storytellers, which could become a valuable new source of income for Spotify.

It also turns Spotify into a commercial bookstore and audiobook publisher, a title the company has been hesitant to embrace for its podcasting efforts.

"With this acquisition, we're going to be able to accelerate the addition of an audiobook catalogue onto the platform so that users can effectively get all of the audio content that they want all on one platform," says Nir Zicherman, head of audiobooks at Spotify, in a chat with The Verge.

Zicherman says the team is focusing on "innovation" in the space to make audiobooks a "richer experience," as well as "democratization," in the sense that more people can create and publish more audiobooks. He also wants to work on audiobook discovery, as he has always focused on music and podcasts.

Zicherman declined to share details about exclusives that could influence Spotify's audiobook strategy but praised the company's work with creators. "Currently, Voices allows creators to distribute widely," he says, "and that is a very important part of the offering and something that we plan to maintain and continue to support because we believe it is part of what makes the platform so powerful from a creator's point of view."

Zicherman also says that Spotify's main app will likely get more audiobooks in early 2022 when certain open access associations start distributing content there. (Storytel, a major audiobook streaming app, is an initial partner.) However, these moves aren't the first to signal Spotify's interest in the audiobook space. He worked with YouTubers and celebrities in January to distribute readings for classic books, like Frankenstein, and also partnered with J.K. Rowling's Wizarding World to launch Harry Potter and the Philosopher's Stone in audio form.

Most importantly, the acquisition will give Spotify a new way to make money while staying in the audio business. Findaway shares authors' royalties, which means that every time someone buys a book distributed by Findaway on the platform, Spotify makes money. A portion of the revenue will also be needed when people buy a book on the platform, just like any retailer. (A spokesperson declined to comment on their monetization plans.) It seems possible that Spotify could launch new subscription tiers, similar to Audible, to account for audiobook consumption. In particular, however, Spotify will also have to pay royalties to other audiobook publishers and authors, similar to how it treats music content.