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Amazon Losing Support of Indie Authors

When Amazon started withholding or delaying the shipment of books of Hachette authors this past May during its dispute with Hachette, authors—mainly other traditionally-published authors—stood up in support of the Hachette authors and books being unfairly penalized by Amazon. And Authors United was born. But, as David Streitfeld describes in a front-page article in Sunday’s New York Times (subscription required), self-published authors also have much to lose from the loss-leader pricing and market pressures Amazon is able to impose because of its monopoly over the book market. In its drive to dominate the online consumer goods markets, Amazon has used books as a loss leader to draw in, and acquire data from, consumers with disposable income. In doing so, Amazon has run roughshod over authors, commoditizing and devaluing the books it sells.

Now, Amazon’s dominance in e-book publishing is allowing it to put a squeeze on the self-published authors who use its Kindle Direct platforms to release their own books, as well as traditional publishers and their authors. Just five months after Amazon launched its e-book subscription service, Kindle Unlimited, there’s growing evidence of frustration among independent authors, reports Streitfeld.

Independent authors who thought they had a partner in Amazon, to help them build a career are starting to feel victimized by its monopoly power. Authors are taking issue with the decreased earnings they receive when their books are enrolled in Kindle Unlimited, which gives subscribers all-you-can-read access to around 700,000 e-books for $9.99 a month. Kindle Unlimited readers aren’t purchasing individual titles at the rate they had been, it seems. Romance writer H.M. Ward told the Times that, after a mere two months in the Unlimited program, her income dropped 75 percent. The sole purpose of the subscription model is to reel in even more readers and guide them toward other consumer purchases, not to make a profit, and certainly not to allow authors to be fairly compensated. Rather, the Unlimited Program’s all-you-can-eat model will inevitably lead consumers to think of books as essentially free, as many now do with music. “The books, in that sense, are loss leaders,” writes Streitfeld, “although the writers take the loss, not Amazon.”

Compounding the problem for indie authors is the fact that, under the Kindle Unlimited payout scheme, self-published authors are treated as second-class citizens. Amazon pays for traditionally-published books as if a copy were sold once a reader has browsed more than 10% of it, but self-published books merely get a share of a pot. According to the Times report, in July the fee for a digital borrow was $1.80; by October it had fallen to $1.33; in November it rose slightly to $1.39. This two-tiered model completely overlooks one of the defining characteristics of self-published authors: they’re not just authors, they’re also publishers in their own right. Why should they get less per book than traditional publishers?

We’re also still troubled by the “exclusivity bind” that Amazon puts self-published authors in. When Kindle Unlimited went live in July, it announced that over 500,000 self-published books in the Kindle Direct Publishing Select program would be automatically enlisted in the Kindle Unlimited subscription program. Enrollment in KDP Select is not strictly mandatory, but Amazon incentivizes enrollment by offering higher royalty rates for KDP Select members. In exchange, Select authors commit to making their e-books available exclusively through Kindle, preventing indie authors from exploring other sources of revenue as long as they are enrolled.

Finally, we take issue with the fact that Kindle Unlimited pays authors the same rate per read whether the book is short or long, labored over for years or dashed off in a day. This provides a strange incentive for authors to break up their works into smaller and smaller units—chapters rather than books. (Not that we have anything against short works; for example, we’ve always been supportive of Amazon’s Kindle Singles program.) But more importantly, it reflects Amazon’s tacit denial of the idea that books represent intellectual enterprise, that they contain ideas, and that they represent differing levels of investment on their authors’ parts. A market that values all books identically is inconsistent with the realities of authorship and the value readers place on different books.

As “hybrid” authorship (“hybrid” authors are those who self-publish some books and use traditional publishers for others) is becoming more common, Kindle Unlimited’s shortcomings are affecting the livelihoods of a growing number of American authors. There has even been talk, according to Streitfeld’s report, of self-published authors unionizing to oppose Amazon’s tactics. While the Authors Guild is not a “union,” we are a voice for all authors and have been for over 100 years. Indeed, we were formed for the purpose of ensuring fair treatment for authors.

Our issue with Amazon is not personal; it is simply this: its dominance of the book market is hurting that market and has the potential to all but destroy it in the long run by making it impossible for authors to make a living. The fact that Amazon is using self-published authors as loss leaders belies its claims of support for the literary community, and demonstrates its dedication to profit, not to authors.

As business models in book publishing evolve, the Guild is committed to ensuring that working writers can make a living—as authors. We are agnostic about methods of publishing and distributing books, as long as authors get paid fairly. We do not want to see book publishing go the way of the music industry, where many songwriters and musicians are making a fraction of what they made in the past. The publishing industry is bound to change in the coming years, and although we cannot predict exactly what it will look like, we will strive to make sure working writers continue to be compensated fairly in all markets.

The proliferation of new distribution models holds promise for all authors, self-published or traditionally published, but it’s also part of what makes these times challenging. One of our priorities in 2015 is to monitor these developments and to provide Authors Guild members with frequent updates on what we’re learning.

We invite self-published authors to join the conversation and to share their experiences. Our doors have been open to self-published authors since 2013. We invite you to take a look at our membership requirements here. As part of our new website, we will have conversation forums and daily updates on matters of interest to working writers. Our hope is that together we can better understand and navigate the uncertain future.

We are also busy planning a public panel event on new business models in book publishing, to be held in New York City in February 2015. We’ll send out the details when they become available.