One disconcerting thing about ACX is that, unlike with print or ebook, the author has no control over the price of the product. In general, audiobooks on Audible are priced based on length—for example, a book less than one hour is generally priced at less than $7, a book over 20 hours is generally priced at $25-$35. However, this is a guideline only, and “Audible retains the sole discretion to set the price of the audiobooks it sells.” (https://www.acx.com/help/what-s-the-deal/200497690)
In addition, there are a couple of ways an audiobook customer can purchase your book beyond the a la carte option described above. One is via credits if he or she is an Audible member. This results in a lower cost for the book and, I believe, a lower resulting royalty. Another way a customer can purchase an audiobook on certain eligible books is via Whispersync, meaning that a customer who has a Kindle version of the book can purchase the audiobook for a deeply discounted price. (See my April 9, 2016 blog post "Audiobooks - Part 2 - Picking a Platform" for more information.) In its “What’s the Deal?” write-up, ACX says, “The royalty you earn <on Whispersync sales> will be the royalty rate based on your contract times the Whispersync upgrade price.” I gather this to mean that both sales to a customer using Audible membership credits and sales to customers eligible for the Whispersync discount will result a lower price and thus a lower royalty.
Audible doesn’t control how iTunes prices a book, but will pay a royalty as if the sale were an Audible a la carte sale.
For an overview of ACX royalties, I’m going to rely on this clear and concise description provided by the Author Marketing Institute:
… there are different potential royalty splits depending on how you created your audiobook. If you selected Pay for Production by paying up front for your book, then you’ll have a 60/40 royalty split. Audible will receive 60 percent of each sale, while you collect 40 percent. You must choose to be exclusive to Audible for seven years to get the 40 percent royalty, which drops to 25 percent if you go non-exclusive. …
If you’ve used the Royalty Share option to get your book produced, then you’ll split the 40 percent royalties in half. Audible will take 60 percent of exclusive books, your narrator will take 20 percent, and you’ll get the remaining 20 percent. Non-exclusive contracts are not available through Royalty Share. All contracts with ACX are for seven years. If you sign the exclusive contract, you won’t be able to sell your audiobook on any other platforms for at least seven years.
I used the Royalty Share option for The Sense of Death and the Pay for Production option for The Sense of Reckoning, and have pros and cons for each that I will share in my next blog post!