The subscription-retail balance suggests that, when price friction is eliminated, audiobook popularity soars, and that of course is where the value of subscription lies, ironing out the price differentials and presenting a level playing field to consumers.
With the Moscow International Book Fair not long ended I’ve been belatedly chasing detail on the event as internet stability emerges from the monsoon season here in West Africa where TNPS is written.
In an MIBF discussion titled “Audio segment: market trends, growth points, marketing technologies” the end-2021 audio market value in Russia was forecast to be 3-3.5 billion rubles ($41.7 million – $48.7 million).
Denis Petrov of Alpina Digital Publishing House said at the event that,
1,700 ebooks bring 60% of digital income, while only 700 audiobooks bring 40% of digital income,
adding that subscription revenue was already ahead of retail revenue for the format.
As ever, a TNPS caution here, to note that audiobooks at retail usually cost a lot more than the ebook counterpart, and the numbers here tell us nothing about relative volume and profitability.
That said the subscription-retail balance suggests that, when price friction is eliminated, audiobook popularity soars, and that of course is where the value of subscription lies, ironing out the price differentials and presenting a level playing field to consumers.
Which brings us to the giants of the Russian audiobook scene, LitRes and Storytel.
Per the headline, Storytel Russia Country Manager Boris Makarenkov said at the Fair that,
The next five years will be the most successful in the history of audiobooks.
Makarenkov notes that audiobooks are at just 10% penetration, so plenty of room for growth.
Per a report by Eugene Gerden in Publishing Perspectives in September, Storytel runs second place to domestic digital books giant LitRes (part of Eksmo-AST), which owns 70% of the Russian audiobook market, but Makarenkov reported to garden a 45% increase in audiobook downloads in 2020, and the 2021 market continues to expand for all players.
Circling back to the 3-3.5 billion ruble valuation forecast for end 2021, LitRes CEO Sergey Anuryev told Gerden last month that back in Q1 2021 the market was worth 740 million rubles ($10 million), suggesting a 4-fold increase across 2021.