Spotify has made its latest acquisition in the non-music audio space, and it represents another step forward in the company’s strategy to get into audiobooks. The company has agreed to buy audiobooks firm Findaway for an undisclosed amount.
Findaway is an interesting company: it’s not just an audiobooks service for consumers. It’s a B2B company covering distribution, production and the development of apps and content for libraries and retailers. It’s a deal that should help Spotify swiftly ramp up its ability to not just add existing audiobooks to its service, but to produce original ones itself.
“We plan to build on Findaway’s significant innovation in the space, and we’re going to supercharge its growth, bringing everything Spotify knows around personalisation and discovery while also innovating on format, delivery, creator tools, and more,” is how Spotify described its plans. “Findaway’s technology infrastructure will enable Spotify to quickly scale its audiobook catalog and innovate on the experience for consumers, simultaneously providing new avenues for publishers and authors to reach audiences around the globe.”
Audiobooks is far from a brand new market for Spotify. It was experimenting with them as far back as July 2009, when it added tech maven Chris Anderson’s ‘Free: The Future of a Radical Price’ audiobook to its service in the UK. But it was 11 years later, in May 2020, when Spotify signalled greater ambitions for the format, bagging exclusivity on a new celebrity-narrated audiobook of Harry Potter and the Philosopher’s Stone.
In January 2021, it also commissioned nine new recordings of classic (and thus public-domain) books like ‘Jane Eyre’ and ‘Frankenstein’. Meanwhile, Spotify had advertised a role as head of audiobooks, taken initially by former Audible exec Sean McManus.
He only stayed at the company for eight months from February 2021 though. In October, Anchor co-founder Nir Zicherman took on the role of head of audiobooks and gated content at Spotify. His experience of joining Spotify through an acquisition will come in handy for the Findaway integration.
Research firm Omdia reckons that spending on audiobooks and audiobook service subscriptions will grow from $4bn in 2020 to $4.8bn in 2021, and $9.3bn by 2026. Amazon subsidiary Audible is the 900lb gorilla in that world, and startups have struggled to compete with it. Spotify will be more hopeful of securing a slice of those revenues as it continues its expansion beyond music, in a move that parallels Tencent Music’s move into audiobooks in China.
What does this mean for music? Spotify’s aggressive push into podcasting did cause some concern from labels and musicians about spoken-word shows eating into music listening on the service. Spotify has always argued that podcasts increase engagement and loyalty, with positive effects for music. We expect to see a similar dialogue play out over audiobooks.
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