Subscription Model Squabbles

So, authors, you’ll all remember when, in the middle of the Amazon-Hachette spit-fight, I noted that Amazon isn’t your friend, it’s a business entity with its own goals, which may only tangentially align with yours (and the same goes for Hachette)?

Surprise!

Authors are upset with Amazon. Again. For much of the last year, mainstream novelists were furious that Amazon was discouraging the sale of some titles in its confrontation with the publisher Hachette over e­books. Now self­-published writers, who owe much of their audience to the retailer’s publishing platform, are unhappy. One problem is too much competition. But a new complaint is about Kindle Unlimited, a new Amazon subscription service that offers access to 700,000 books — both self­published and traditionally published — for $9.99 a month. It may bring in readers, but the writers say they earn less. And in interviews and online forums, they have voiced their complaints.

Part of the issue, as I understand it, is that the payment Amazon doles out to many self-published folks who participate in Kindle Unlimited comes not from the percentage of a sale price, but from a slice of a pot of money Amazon decides to offer, called the KDP Select Global Fund. Here’s how it works, from the Amazon FAQ on the matter:

We base the calculation of your share of the KDP Select Global Fund by how often Kindle Unlimited customers choose and read more than 10% of your book, and Kindle Owners’ Lending Library customers download your book. We compare these numbers to how often all participating KDP Select titles were chosen. For example, if the monthly global fund amount is $1,000,000, all participating KDP titles were read 300,000 times, and customers read your book 1,500 times, you will earn 0.5% (1,500/300,000 = 0.5%), or $5,000 for that month.

However, as Amazon gets to select the size of the pot, and the share of the pot is contingent on performance relative to other titles, how much that cut is can fluctuate substantially, as is noted in the article. The article also notes that as the cut is the same for any read (i.e., a short story and a Rothfuss-sized epic novel are the same in the eye of the Kindle Unlimited clicker), authors are chopping up larger books into several files, or writing books as serials (looks like The Human Division was on target for that model).

Given the nature of the payment game here, this is a rational response, but it’s a short term solution at best, as it explodes the number of titles in Kindle Unlimited (and commensurately the number of titles read). As more authors catch on that particular trick, the less useful it will be for everyone. And while Amazon says it will tweak the size of the pot “to make participation in KDP Select a compelling option for authors and publishers,” inasmuch as self-published authors are already griping about how much revenue they’ve lost, the question becomes whether it will ever become a genuinely compelling option.

(Note well that these terms are as I understand it currently only for the majority of self-published authors. Publishers, who have more leverage on Amazon’s business, and certain (very few) high-profile self-published authors, are able to make deals that resemble traditional payment/royalty deals. They are not in the same payment pot as the hundreds of thousands of self-published authors, and they are not enjoined by exclusivity, as the majority of self-published authors are. Which if my understanding is correct is certainly an interesting point of data for those self-published authors.)

Does this make Amazon’s subscription scheme, or Amazon itself, evil? Nope. It does reinforce the point that Amazon has its own plans, which are not really about helping authors, per se. Its plans center on being the one single place everyone buys anything, ever. A $9.99 all-you-can-eat reading subscription plan with titles exclusive to Amazon is a fine way to lock consumers in the Amazon ecosystem. That’s Amazon’s job: to get and keep consumers’ business. It’s also the job of Oyster and Smashwords and other places that are also trying to make a go of the all-you-can-eat book subscription thing. What’s also their job: Getting the product that will enable them to reach their goals, and getting the product as cheaply as possible.

That said, the thing to actively dislike about the Kindle Unlimited “payment from a pot” plan is the fact that it and any other plan like it absolutely and unambiguously make writing and publishing a zero-sum game. In traditional publishing, your success as an author does not limit my success — the potential pool of money is so large as to be effectively unlimited, and one’s payment is independent of any other purchase a consumer might make, or what any other reader might read.

In the Kindle Unlimited scheme, the pool of money available to authors is strictly limited by a corporation whose purposes, short- and long-term, are not necessarily aligned with the authors’, and every time someone with a Kindle Unlimited account reads another author’s work, every other authors’ share of the pot becomes that much smaller. In the traditional publishing model, it’s in my interest to encourage readers to read other authors, because people who read more buy more books — the proverbial tide lifts all boats. In the Kindle Unlimited model, the more authors you and everyone else reads, the less I can potentially earn. And ultimately, there’s a cap on how much I can earn — a cap imposed by Amazon, or whoever else is in charge of the “pot.” As an author, I won’t be able to ever earn more than Amazon wants me to (especially if Amazon requires my title to be exclusive).

So: Evil? No. Good for authors? Let’s just say I’m not entirely convinced. And neither, it seems, are these self-published authors. Good for them. I genuinely wish them the best of luck getting Amazon (and others) to pay them what the market will bear, and not just what Amazon wants to pay.