Confab in The Desert

It's perhaps fitting that Las Vegas--a town famous for flaunting all that money can buy--was the setting for the Audio Publishers Association's second annual Audiobook Buyers Conference held February 27-March 1 at the recently opened Palms Hotel and Casino. Sixty-five attendees, representing major retailers and distributors as well as audiobook publishing companies of every size, converged on Sin City to exchange ideas, discuss industry issues and develop business contacts during the conference's roster of educational and social events.

According to Beth Baxter, publisher of B&B Audio Inc. and organizer of the conference, the number of publishers decreased from 26 to 16 this year, though the total attendance was the same as at last year's inaugural meeting. "I think it went well, considering this was a tough year for the economy and people are still not traveling as much," Baxter said. "But it's still way too early to tell if it was beneficial for those who came. Everyone's going to measure it differently."

In fact, differences--those things that distinguish various audio markets and publishers from each other, that is--were at the heart of the conference. Thursday morning began with a presentation highlighting statistics from the APA's recent consumer survey. Maja Thomas, v-p of the APA and v-p of Time Warner AudioBooks, offered a profile of an audiobook user as culled from the survey's results, as well as updates on the organization's audio awareness efforts, which include recording public service announcements with celebrities and audiobook narrators, pushing the June Is Audiobook Month campaign and the preparation of an audiobook promotional sampler to be distributed in General Mills cereal boxes this fall. Next, a panel of 12 speakers from diverse segments of the audio industry spoke on the topic "How Long Will the Cassette Continue to Sell?" In short, the answer was a resounding "we don't know."

Debating the merits of each of the numerous audio formats available today is nothing new. It's been going on since the CD revolutionized the music industry and began to make headway into the spoken word category several years ago. But these days, audiobook publishers find themselves at a particularly confusing crossroads. No one can predict with any certainty what the next standardized technology for listening to audiobooks will be--or if standardization will ever occur.

Any new wave will in large part depend on decisions made by automobile manufacturers and the sound system technologies they provide in their new cars, as a majority of audiobook listening is still done in the automobile. At present, the auto industry shows signs of leaning toward MP3 technology. (This past year, the APA has opened lines of communication with Detroit, offering sound system experts information on the vast contingent of car buyers who are also audiobook listeners.) The demand for cassettes remains high in many markets while the demand for CDs is, in several arenas, growing. Some publishing companies are experimenting with digital audio downloads from the Internet and with MP3-CDs; both are being talked about as mainstream options for the future audiobook listener, but have not caught fire with consumers yet. Others have suggested that the audio industry should find a way to capitalize on the growing popularity of DVD technology (the majority of new personal computers have DVD players, which can play audio as well as video titles). What's an audio publisher to do?

For now, it appears the audio publishers most likely to succeed are catering to a particular niche of the marketplace, or are publishing in multiple formats, attempting to reach a broad spectrum of listeners.

During the panel discussion Guy McMullan of Brodart, the wholesale supplier to libraries, indicated that MP3 technology is generating "all the buzz in the libraries right now." But for Alex Crosby, adult collection development librarian for the Las Vegas-Clark County Library District, "tapes are not dying out anytime soon in our libraries." Crosby noted that nearly 90% of his system's circulating audiobook titles were on cassette in 2000-2001.

Paul Coughlin of Blackstone Audio described the MP3-CD as his company's "fastest growing medium, up 344% in revenues over last year." However, Jeanne Marie Hudson of Time Warner AudioBooks said her company "has no plans to go to MP3 yet. We are working with Audible and our own Web site on downloads. We believe that the Internet is more mature [than the MP3-CD] right now."

In the mail-order segment, Audio Editions' Chris Benson noted, "The cassette is a long way from dead" and "sells 3-1, sometimes 4-1 over CDs" among catalogue customers. Traci Cothran of Audio Book Club commented on a puzzling CD trend: CD sales for the club dropped in 2001, after being very much on the rise in 2000. "Our initial offerings for club membership [promotions allowing consumers to choose a number of audio titles for a very low introductory price] used to be weighted to CDs," she said. "But the percentage of CDs in those initial offerings has decreased." Cothran said that the first mailings of 2002 have gone out, but it's too soon to tell if the CD decline is continuing.

At audio-only retailer Talking Book World's chain of 45 stores, CDs account for 15% of total sales according to buyer Paula Sieffert. "We tried MP3-CD with The Talisman [the Stephen King/Peter Straub release from Simon & Schuster Audio] and it did not do well for us," she said. "We're seeing very little demand for the format at this point."

Don Paddock of BarJan described the needs of "professional drivers" and noted that truckers and travelers that frequent truck stops prefer cassettes at a mass-market price. He also noted that truckers spend approximately 20 hours per week listening to audiobooks on the job.

Marianne Nemetz of Levy Home Entertainment, which buys audiobook titles for Best Buy, Target, Wal-Mart and other mass-market retailers, delivered some of the most disheartening news of the conference. She related that Best Buy stores have drastically reduced space devoted to audiobooks. Because of this trend, she said, "we return 50% of what we order in audiobooks. We're gun-shy."

On a more invigorating note, Monty Hudson of L.A. Theatre Works (and former head of RioPort, the digital media company) commented, "The cassette should be dead." He went on to suggest that the future of audiobook publishing lies in digital distribution of some sort. "Industry leadership is key to changing formats," Hudson said. "Don't wait for change to happen. Be unified, be proactive, stay focused."

Meeting of Minds and Accounts

After a luncheon, attendees broke into groups for brainstorming sessions designed to generate "pie-in-the-sky ideas" for how to increase audiobook awareness and sales. Suggestions ranged from creating high-profile ad campaigns and hiring a celebrity spokesperson to developing a syndicated radio program devoted to audiobooks. Other results will be shared during APAC programming May 2 in New York (see below).

On Friday morning, publishers were given the opportunity to meet one-on-one with buyers during 12-minute round-robin sessions. Attendees unanimously praised this portion of the conference. "Today is the beneficial day for us," said Michael Viner, publisher of New Millennium Audio. "Nobody can represent our product like we can." Bruce Coville, children's author and founder of Full Cast Audio, a new company devoted to full-cast performances of family listening titles, noted "It's been a blessing to be able to meet with all these people." Full Cast's marketing director Dan Bostick added, "For our first event, we couldn't have asked for anything better."

The conference was not without its dissenters, however. Some attendees lamented the lack of new information presented during the panel discussions and others expressed dismay at what they termed "gaps" or "holes" in the APA's consumer survey. And though many attendees were generally pleased at the progress the conference has made thus far, publishers, especially, have high expectations when it comes to gaining access to buyers. Paul Coughlin, marketing manager of Blackstone Audio noted, "This year was even more helpful than last year. But we still need to reach more buyers. If the same buyers are here next year, I may not come; I can meet those buyers at trade shows." Another audio publisher commented, "It would be better if they had more of the bigger retailers and buyers, and maybe buyers for some nontraditional outlets, too." While attendees lauded the round-robin portion of the conference, most felt it was too short. "More time should be dedicated to the face-to-face part of the program," said Mark Fichtel of Brilliance Audio. Fichtel also believes that given their influence on the audio industry, the car manufacturers seemed like a natural fit for the conference. "They should be here," he said.

In conversations with PW, the majority of conference attendees felt their time in Las Vegas was well spent. Many agreed with Fichtel's generally upbeat assessment: "Sometimes it feels like we're in a dark room, feeling around for the light. But after hearing the people here it's good to know that others are thinking the same things about the industry that I am."

With so many industry minds on the same wavelength, perhaps next year's Buyers Conference panels (the APA board will vote this summer on whether to host a conference in 2003) will highlight the forward momentum made toward industry change/standardization. Until then, publishers and buyers face the continued challenges of meeting the needs of their many and varied market segments.