Donald Katz, Amazon's (NASDAQ:
) Audible.com founder and chief executive officer, appeared on
CNBC's Squawk Box on Thursday morning to talk about his popular
audio book company.
Prior to founding Audible.com in 1995, Katz was a journalist
and author. About 20 years ago, he was asked to write a book on
the digital media revolution before there was a big innovation
and change to write about. He said that there wasn't much to go
on except predictions, which he couldn't base a book off of. Katz
instead became more aware of the technology around him.
"The inefficiencies, which I saw a lot as an author in the
publishing model, would be addressed by digital distribution,"
He looked into audio books, and realized after struggling with
physical media, like books on tape, that there had to be a better
way to reach out to the audio book market. So Katz and his
college roommate, a computer science major, got together and
invented the first digital audio player, which they launched in
1997, beating Apple's (NASDAQ:
) iPod by almost five years.
According to Katz, Audible.com has millions of members based
on a subscription service that offers them 18 audio books a year.
He said that members often stay for longs periods of time based
on their subscription model.
Part of their success comes from the practice of employing
famous actors to read books for their service, recording the
voices of A-listers like Jake Gyllenhaal, who read The Great
Gatsby for Audible.com. Katz calls it fantastic storytelling
retold to listeners from brilliant actors.
"It just sort of dawned on me that theater is based on text,
movies are based on text. Why wouldn't books be some of the
greatest scripts of all time," said Katz.
They also train actors to read for audio book recordings in
programs at big acting schools like Tisch at NYU and UCLA. Katz
said that it's created a new industry specific to audio books
that breaks a model in the acting industry, which allows actors
to work a lot more. He said they have several relatively unknown
Broadway actors who earn several hundred thousand dollars a year
from reading for Audible.com alone.
Six out of ten of their members had never purchased audio
books before subscribing, but Audible.com audio books are of what
some may consider the highest quality in the format's history.
Katz said that his service is about what really matters, the
writer and the actor, and the listener on the other side.
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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