Audible.com

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Audible.com

• Audio that speaks to you wherever you are
• Joe Flowers
• CS453

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Introduction

• Audible converts audiobooks and other spoken
  audio programs into digital files
• Buy an audiobook from Audible and its yours
  forever to listen to as many times as you like.
  1

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Ways To Listen

• Download and listen to audio on your computer
• Streamed over the internet on your computer
• Transfer audio from your computer to a CD or
  AudibleReady player
• Proprietary file format, more compressed than
  mp3s 1

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Types of Content

• Non-fiction
• Highly personalized listening drawn from sources
  such as The Wall Street Journal, The New York
  Times 2
• Other
• Novels
• Proprietary content 3
• Magazine editions
• Growing library of comedy
• Joint venture with Random House

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How To Find Content

• Search by title or author
• Browse by category
• Check out the best seller list
• Music review from the latest audio magazines and
  newspapers
• 1

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Get some audio!

• A la carte 6
• Buy on a title by title basis
• Subscription plans
• Get one audio magazine, newspaper or radio
  program plus one audiobook each month for just
  14.95 a month.
• Get two audiobooks each month for just 19.95 a
  month.
• Automated downloads
• iTunes for Mac
• AudibleManager for PC

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Hardware requirements 4

• PC
• Windows 98 or higher
• Macintosh
• OSX with iTunes 3 or above
• Hardware to listen
• Audible Otis MP3 player (free with 1 yr
  subscription)
• Palm Handheld
• Apple iPod
• Other players

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History

• Founded by Jeffrey Katz 3
• Publicly traded since the summer of 1999 2
• Microsoft invested early on and now has
  investments totaling 15 million 5

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Partners

• Microsoft
• Amazon
• Random House 2
• Joint marketing agreements with device
  manufacturers including 3
• Hewlett-Packard
• Sony Electronics
• Apple

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Ipod integration 5

• Integrates with iTunes on OSX
• Comes with AudibleManager for PC 6
• Receive 100 off a new Apple iPod when you
  purchase a 1 year subscription 7

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Awards

• CNET editors choice 8
• Named to Deloitte Touche's prestigious
  Technology Fast 50 Program for New Jersey 9

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Growth 9
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Business Model 2

• Audible was designed to become an extremely
  profitable enterprise and designed to get to
  that state as the clear leader. This is a company
  that does not need that many consumers paying us
  on a regular basis to be a very profitable
  enterprise, because of the fundamental structure
  of the business model. As we scale up the
  infrastructure needed to serve large numbers of
  customers because of the efficient nature of
  the inventory and delivery structure it doesnt
  need to scale that heavily.

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Business Model (contd)

• Target Operating Model 3
• Revenue - 100
• Content Costs - 30
• Marketing Costs - 25
• Operation Costs - 15
• Pre-tax Margin - 30

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Ownership - January 15, 2002

• Above 5 3
• Microsoft 35.5
• Amazon.com 6.7
• Donald Katz (founder) 5.7
• Management/Directors 8.8

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Distribution 3

• Audible.com
• Amazon.com
• Affiliates program
• Corporate Sites (B2B)
• Library program

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Growth/Customer Base 3

• Plan to add a couple of thousand hours of content
  per quarter.
• No overseas advertising yet they have customers
  in 100 nations.
• Demographics still skews to men, average income
  90k, 40 have advanced degrees, but they are
  seeing a move down from high-income users.  Most
  use for commuting and exercising, with some
  listening at desktop for short duration content
  items.

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Competition 3

• Traditional and online retail stores, catalogs,
  clubs, and libraries
• Websites that offer streaming audio utilizing
  Windows Media Player or RealPlayer
• MediaBay.com

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Will They Make It?

• Long term potential
• Loyal Subscriber base
• Sweet Spot Operation
• Rise of broadband
• Prognosis Positive!

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References

• 1. www.audible.com (click How it works)
• 2. www.twst.com/ceos/adbl.html
• 3. www.cognitrol.com/ADBL/overview.htm
• 4. www.audible.com (click What I need)
• 5. www.atnewyork.com/news/article .php/584711
• 6. www.apple.com/ipod/audible.html
• 7. www.audible.com/gojandr/
• 8. reviews.cnet.com/4505-3514_7-9624241.html?leg
  acycnetdir
• 9. http//bigcharts.marketwatch.com/quickchart/q
  uickchart.asp?symbADBLsid152157
  o_symbADBLx33y18
• 10. http//bigcharts.marketwatch.com/news/article
  s.asp?guid2D0BA43F-70FB-474D-B0B4-85D4BE5A3C9C
  newsid806550614symbADBLsid152157
• 11. www.audible.com/katz