Amazon shut down its fan-fiction service Kindle Worlds in 2018 after five years, and some authors told Business Insider they lost thousands of dollars in monthly income.

The service licensed book series like "Gossip Girl" and "The Vampire Diaries" for authors to write fan-fiction stories for.

Former Kindle Worlds authors described how they bounced back after the shutdown, and their stories show how dominant Amazon is in the publishing world.

A Harvard Law professor who studies the space thinks Kindle Worlds was doomed from the start, because Amazon's approach was "antithetical" to the core of fan fiction, she said.

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Desiree Holt, affectionately known as the oldest author of erotic romance at 83 years old, climbed out of a financial plight in 2013 thanks to Amazon.

At the time, Holt was writing romance novels for the the publishing company Ellora's Cave, which was collapsing and ultimately shut down in 2016. Holt felt her income was in jeopardy. But in 2013, Amazon launched a fan-fiction service called Kindle Worlds, a digital publishing platform that let authors publish fan fiction within certain licensed "worlds," which at first included properties from Warner Bros.' Alloy Entertainment, like "Gossip Girl," "Pretty Little Liars," and "The Vampire Diaries."

Holt embraced the new platform and said she was making between $3,000 and $5,000 a month on Kindle Worlds, a "huge part" of her income.

But in 2018, Holt suddenly found herself back to the drawing board when Amazon shut down Kindle Worlds. And she's not the only one. Business Insider spoke to several romance authors about losing out on thousands of dollars in monthly income when the platform closed.

"When Kindle Worlds shut down, it hit me financially," Holt said. "That's a big hole in your pocket. It took me a while to build back up to that level again."

And she's also borrowed a bit of the Kindle Worlds model to help boost her income.

Holt's launching a new book called "Unexpected Risk" in her "Phoenix Agency" series on February 28 and she invited 10 authors to write in that universe, with some specific guidelines Holt's set. All the books will launch the same day to increase exposure — on Amazon's Kindle.

The reality for many authors is that Amazon is an inescapable force in the publishing industry. And if Amazon were to launch a service similar to Kindle Worlds again, Holt would sign on in a heartbeat.

"I'd say 'send me the contract right now,"' she said. "You have to go into it with the understanding that [Amazon is] the big dog. I got a lot out of it and I'm more successful now because of it. I was really sorry to see it end."

The story of Amazon's foray into fan fiction, and how it changed over the last few years, shows how many authors have to play by Amazon's rules to make a living — and be subject to its whims in how it supports particular platforms or products.

It was good while it lasted

The fan-fiction service most like Kindle Worlds prior to its creation was FanLib, which launched in 2007 and closed the following year.

But despite FanLib's failure, Amazon's backing and the promise of increased readership made some authors very optimistic about how Kindle Worlds would help their careers.

At the start, Amazon seemed to be expanding the service and innovating in concrete ways. Around a year after the launch, Amazon began recruiting established authors with their own universes outside of the original licensed properties to join Kindle Worlds. These authors would invite others to write in their universes (and potentially make money from sales).

Holt discovered Kindle Worlds when she was invited to write in romance author Carly Phillips' "world" and she eventually launched her own world for others to write in.

The authors who licensed their works to Kindle Worlds and the fan authors writing in their fictional universes would both receive up to 35% of revenue from each sale, while Amazon received the remaining 30%.

Jen Talty, also a romance author, wrote in other authors' worlds and told Business Insider she was earning anywhere from $1,000 to $1,500 a month. It was her main source of income and sometimes double what she was making through other sources, she said.

Romance writer Elle James, the author of the "Brotherhood Protectors" series, told Business Insider she was making anywhere from $5,000 to $12,000 a month.

"Opening up the worlds to other authors allowed my readers more access to my world," James said.

"The Vampire Diaries" novel series was one of the licensed properties on Kindle Worlds. The CW/Tina Rowden

The bottom line: many authors were happy to partake in Kindle Worlds, especially with the backing of Amazon.

The original "Vampire Diaries" author, LJ Smith, even wrote "Vampire Diaries" fan fiction on the platform after Alloy Entertainment fired her from the series, and her installments rose to the top of the Kindle Worlds charts.

But in May 2018, Amazon sent Kindle Worlds authors an email — a copy of which was provided to Business Insider — with the subject line: "Important Kindle Worlds Update."

The notice said Kindle Worlds stories would no longer be available for sale on Amazon by mid-July and that the Kindle Worlds website would close by the end of that August. It said that the rights would revert back to the authors once the stories were removed from Amazon.

"For five years, Kindle Worlds has been thriving, engaging writers and readers who enjoy writing in one another's worlds, and we're proud of the work we've done together," the email said. "While we are closing Kindle Worlds, Amazon is constantly innovating on behalf of our authors and readers, and we look forward to continuing to do so."

When asked to comment on why Amazon shut the service down, a company spokesperson reiterated the points in that email.

"While Kindle Worlds has closed, we continue to experiment and explore new opportunities to innovate in the storytelling space," the spokesperson added.

The spokesperson said Kindle Worlds did not have a low readership or customer base, and that the service "successfully engaged" fan fiction authors and readers.

So why did it shut down?

In the absence of a clear explanation from Amazon, authors have their own theories. One author said an Amazon employee told them the company's tech couldn't effectively manage Kindle Worlds. Talty speculated Amazon wasn't making enough money to justify keeping the service. Amazon declined to comment on these two points.

"Amazon considers itself 'consumer centric' and 'author centric,' but the consumer is first," Talty said.

How authors bounced back

When Kindle Worlds shut down, Talty said she was "crushed for about five minutes," but she sees "everything as an opportunity."

She — along with many other authors in the space — are used to hardships in the publishing industry. The company that published her first book, Triskelion Publishing, went bankrupt, for instance.

But even though Amazon reverted the rights back to authors, those like Talty couldn't exactly keep writing the stories she had written in Kindle Worlds because the universes belonged to others.

Talty said that she gave the stories she wrote in the erotic romance author Milly Taiden's world back to Taiden, who then republished them under her own brand. She's also published books with Twisted Pages, a company James started after Kindle Worlds closed.

"It didn't take me long to bounce back because I had a plan in place," James said. "As soon as [Amazon] told us [Kindle Worlds was shutting down], I started setting up my publishing company."

Still, many of the authors' fallback plans also relied on Amazon.

Most of Talty's books are exclusive to Kindle Unlimited — the company's subscription e-book service — a further sign of just how reliant many authors are on Amazon.

"Some say I'm crazy for having all of my eggs in one basket," she said. "But I can't get traction on other platforms."

'The language of control and exploitation'

Authors like Holt, Talty, and James used Kindle Worlds to expand their readership and income.

But much of the fan fiction written is not commercial in nature, according to Rebecca Tushnet, a Harvard Law School professor who has studied the industry. And that disconnect is where she thinks many of the problems with Kindle Worlds stemmed from.

Tushnet is the cofounder of the nonprofit Organization of Transformative Works, which launched the fan-fiction platform AO3 in 2007 as a response to FanLib (the conceptual precursor to Kindle Worlds).

Tushnet told Business Insider that AO3 was meant to be "a sustainable space for fans that wouldn't advertise to them or sell their data," a point she wrote extensively about in a 2014 paper called "All of This Has Happened Before and All of This Will Happen Again: Innovation in Copyright Licensing."

"The language of control and exploitation predominates even in favorable descriptions of Kindle Worlds," she wrote. "Fans are raw material — resources to be exploited and data to be mined."

Science-fiction writer John Scalzi had raised similar concerns in a 2013 blog post. As noted, when Kindle Worlds shut down, Amazon reverted the story rights back to the writers. But Amazon owned them while the service was up and running.

"Once Amazon has [a story], they have the right to do anything they want with it, including possibly using it in anthologies or selling it other languages, etc, without paying the author anything else for it, ever," he wrote.

For these reasons, Tushnet said many within the fan-fiction community weren't scared, but "amused" when Kindle Worlds launched.

Authors like those who spoke to Business Insider earned good money while writing for Kindle Worlds and found it to be a major opportunity in furthering their careers.

But for Tushnet, Amazon's service was more of a commercial entity than a community, and was too limited and controlling in its approach. She said this was "antithetical" to what fan fiction is about, which could be one reason for its failure.

Kindle Worlds "was promoted with the language of fan fiction and fandom," Tushnet told Business Insider. "But it was a bad version of both."

If you have a tip about Kindle Worlds or Amazon's publishing services, or if you're a former Kindle Worlds author with a story to share, email the author at tclark@businessinsider.com