Amazon: Predator or Godsend?

Once upon a time, there was an indie author who wrote this post about Amazon.

Then, time went by and things changed, and the author wrote this post.

Today, Amazon has announced the launch of a new program for KDP authors. According to Publishers Lunch:


Amazon now made official what we reported was in the works last month in Publishers Lunch Deluxe: Authors who publish their work through Kindle Direct Publishing exclusively have the option of putting their titles into the Kindle Owner's Lending Library, compensated through pro-rated shares of a fund "expected to be at least" $6 million for all of 2012 (beginning with $500,000 allocated for the month of December). Titles must be exclusive to the Kindle store for a minimum of 90 days (which is a reduction from the 180 days Amazon initially sought from some authors). If books are currently available through multiple retailers, authors must withdraw the titles from competitors and restore exclusivity to Amazon in order to participate. VP of Kindle Content Russ Grandinetti claims that the "short 90-day commitment allows authors and publishers to experiment at very low risk." Experimenters should note that in the terms sheet we were shown, participation rolls over automatically until cancelled. Amazon says that 31 of the top 50 KDP authors have been persuaded to participate, enrolling 129 titles.

As we reported earlier, participating authors will also be allowed to promote their books for free without jeopardizing their high-royalty status, for up to 5 days each 90-day period. (This allows those authors to try to boost their visibility and ranking within the Kindle store.) There are no "rollover days" from one 90-day period to the next; it's use-it-or-lose-it, according to Amazon documents shared with us.

The monthly royalty payment for each KDP Select book is based on that book's share of the total number of borrows of all participating KDP books in the Lending Library. Amazon cites a representative example of 100,000 total borrows in a month of all KDP Select titles. If an author's book is borrowed 1,500 times - or 1.5 percent of the total - then the author would earn $7,500 from the pool of $500,000. (If your book is not borrowed, you do not share in the pool; but in this example, a single borrow earns $5.)


One important point of ambiguity--in both the press release, and the Amazon terms and conditions shown to us--is that the actual size of the cash "fund" that Amazon makes available appears to be up their discretion entirely. They have consistently talked about $500,000 a month and $6 million for the coming year, but the terms sheet we have seen only states "we will establish a fund on a monthly basis." They use the example of "if the fund for a particular month is $500,000...." Presumably authors might cancel their participation if the funding does not meet or exceed expectations.

Here's a link to the Amazon press release, which mentions some (but not all) of the authors in the program.

And here's a post about the program on the official blog for Smashwords. Just a bit of food for thought, so to speak.