B&H Publishing Group currently has contracts with Apple to distribute our music and applications through iTunes. Terms for sale of these digital products are generally more in our favor than standard retail terms for physical product sales.
Selling Audio books through iTunes, however, requires a relationship with Audible.com (owned by Amazon.com). You will notice that all audio books in iTunes are "published" or "presented" by Audible.com. Audible, however, is only offering standard licensing terms--a tiny fraction of what we earn from music and app sales.
We typically enter audio book licensing deals at the standard (anemic) royalty rates because we bear no burden or risk in cost of recording, distribution, marketing, or sales. In the case of iTunes, however, we own several audio books that we've already produced over the years. We own the content. We own the recording. We are willing to format in whatever way necessary to sell that content and those recordings through iTunes, yet Apple forces us to work through Audible, and Audible (quite smugly, I would add) will only work with us if they get to keep another HUGE percentage (almost double what Apple keeps) on top of Apple's take. For what?
Audible's answer: formatting. iTunes uses some proprietary coding that they (to my knowledge) have not made public. Audible is the only gateway for audio books to go on iTunes, or we can enter a distribution with another audio publisher who is already on terms with Audible and splinter off yet another piece of the revenue. Why?
For new products we are happy to partner with audio book publishers who specialize in the development and distribution of these specialized products, but for assets already in the can, already produced, why should we surrender so much of the revenue just because Apple has placed Audible between us and iTunes? At worst, this feels like extortion. At best, it leaves me simply not wanting to play ball and find other ways to work around selling our audio book content through iTunes.