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Post by Daniel on Jan 17, 2015 9:21:00 GMT -5
...I think the long term plans of Amazon might be somewhat more complicated... No doubt. However, I suspect the author reaction to KU was not anticipated, and it might be making Amazon rethink some long term plans. As Hsin-Yi said, releasing statistics in the email smacks of an attempt at containment. Assuming KU continues to disappoint authors and assuming Amazon wants to keep authors in Select, I could see a couple of things happening. - Unbundle KU/KOLL from Select. Authors who would otherwise leave Select because of KU would stay, and authors who wouldn't use Select anyway could bolster the number of titles in KU/KOLL.
- Reduce royalties to 35% for all titles not in Select. To entice more authors into Select, Amazon could make it so the only way to get 70% in any channel (not just a "select" few) would be to go exclusive.
Of course, either of these changes could happen independently of the other. Amazon could unbundle KU without changing royalties, or they could change royalties without unbundling KU. Indie authors would probably greet the unbundling of KU/KOLL with a parade. Changing the royalty structure would be greeted by wailing and gnashing of teeth. I certainly wouldn't like the royalty change, but given my sales in other channels, my response would be a no brainer: off to Select I would go, KU or no KU. |
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Post by Deleted on Jan 17, 2015 13:35:07 GMT -5
I suspect the author reaction to KU was not anticipated, and it might be making Amazon rethink some long term plans. As Hsin-Yi said, releasing statistics in the email smacks of an attempt at containment. Assuming KU continues to disappoint authors and assuming Amazon wants to keep authors in Select, I could see a couple of things happening. - Unbundle KU/KOLL from Select. Authors who would otherwise leave Select because of KU would stay, and authors who wouldn't use Select anyway could bolster the number of titles in KU/KOLL.
- Reduce royalties to 35% for all titles not in Select. To entice more authors into Select, Amazon could make it so the only way to get 70% in any channel (not just a "select" few) would be to go exclusive.
Of course, either of these changes could happen independently of the other. Amazon could unbundle KU without changing royalties, or they could change royalties without unbundling KU. Indie authors would probably greet the unbundling of KU/KOLL with a parade. Changing the royalty structure would be greeted by wailing and gnashing of teeth. I certainly wouldn't like the royalty change, but given my sales in other channels, my response would be a no brainer: off to Select I would go, KU or no KU. They can't do anything too drastic. I think KU is a long term plan, and unless it really becomes a money pit it won't go away. Actually, I think Amazon is trying to remodel epublishing. If what I fear is correct, 2015 will become the Year of the Great Divide. KU will become, IMO, the bargain bin where you can borrow hastily written, derivative genre books. Maybe over time new authors will be forced to make their debut in KU. "You can still publish with us, and your books will be for sale at a price you determine, but they also need to be in KU. It's for your own good. People will take a chance on a new author if it doesn't cost them anything extra, and if they like your books they might even buy it. You'll gain readers and make money at the same time. Trust us, you'll love it." It might even work for new authors. The big sellers, traditional publishers, and, oh, say the upper midlist won't be affected. The lower midlist and the rank and file, might be. Don't forget Amazon's algorithms can make you as good as invisible in their store. You might be tempted to join KU after all, since a few borrows will always be better than no sales. However, I expect no sudden changes. They don't want tens of thousands of indies to completely abandon KU, and even less Amazon itself. It's not only our books. The least promotion we make, we also promote the Everything Store. And they think this is so important they even pay people, through the Amazon Associate program, to plaster the Internet with links to their site. In promoting out books, we do that for free. So, no wonder the payout went up with a glorious 4¢ a borrow. On KB someone was already crowing, "Oh, how the nay-sayers must be squirming in their chairs," while actually this enormous raise of 4¢ was to be expected. We are in the "acquisition phase" of KU. They need authors and readers in that program. For the time being, and as long as the acquisition isn't the enormous success they claim it os, we can expect a regular carrot among the sticks. |
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Post by Deleted on Jan 17, 2015 14:46:08 GMT -5
I suspect the author reaction to KU was not anticipated, and it might be making Amazon rethink some long term plans. As Hsin-Yi said, releasing statistics in the email smacks of an attempt at containment. Assuming KU continues to disappoint authors and assuming Amazon wants to keep authors in Select, I could see a couple of things happening. - Unbundle KU/KOLL from Select. Authors who would otherwise leave Select because of KU would stay, and authors who wouldn't use Select anyway could bolster the number of titles in KU/KOLL.
- Reduce royalties to 35% for all titles not in Select. To entice more authors into Select, Amazon could make it so the only way to get 70% in any channel (not just a "select" few) would be to go exclusive.
Of course, either of these changes could happen independently of the other. Amazon could unbundle KU without changing royalties, or they could change royalties without unbundling KU. Indie authors would probably greet the unbundling of KU/KOLL with a parade. Changing the royalty structure would be greeted by wailing and gnashing of teeth. I certainly wouldn't like the royalty change, but given my sales in other channels, my response would be a no brainer: off to Select I would go, KU or no KU. They can't do anything too drastic. I think KU is a long term plan, and unless it really becomes a money pit it won't go away. Actually, I think Amazon is trying to remodel epublishing. If what I fear is correct, 2015 will become the Year of the Great Divide. KU will become, IMO, the bargain bin where you can borrow hastily written, derivative genre books. Maybe over time new authors will be forced to make their debut in KU. "You can still publish with us, and your books will be for sale at a price you determine, but they also need to be in KU. It's for your own good. People will take a chance on a new author if it doesn't cost them anything extra, and if they like your books they might even buy it. You'll gain readers and make money at the same time. Trust us, you'll love it." It might even work for new authors. The big sellers, traditional publishers, and, oh, say the upper midlist won't be affected. The lower midlist and the rank and file, might be. Don't forget Amazon's algorithms can make you as good as invisible in their store. You might be tempted to join KU after all, since a few borrows will always be better than no sales. However, I expect no sudden changes. They don't want tens of thousands of indies to completely abandon KU, and even less Amazon itself. It's not only our books. The least promotion we make, we also promote the Everything Store. And they think this is so important they even pay people, through the Amazon Associate program, to plaster the Internet with links to their site. In promoting out books, we do that for free. So, no wonder the payout went up with a glorious 4¢ a borrow. On KB someone was already crowing, "Oh, how the nay-sayers must be squirming in their chairs," while actually this enormous raise of 4¢ was to be expected. We are in the "acquisition phase" of KU. They need authors and readers in that program. For the time being, and as long as the acquisition isn't the enormous success they claim it os, we can expect a regular carrot among the sticks. The only problem I have with assuming AMZ will let KU become some kind of bargain bin is that it assumes that will be profitable to do so. I don't know. Maybe that's their angle. But considering KU seems to be a way to be competitive with ScribD and Oyster I really think AMZ has to figure out how to get more quality content. Although, I think you are right about the long-term part. Maybe years from now the only way to get visibility will be in KU. Or that is the idea.
I've seen quite a few complains about KU from readers, and I think that is, in large, part, why AMZ is starting to respond to the KU situation since their priority is always customer experience.
If Amazon reduces the 70% royalty rate they run the risk of driving new and disenchanted talent straight into the arms of the Big 5. Mainly because then the ability to make more with SP is greatly reduced. The advantages of Big 5 distribution look much more lucrative under that scenario. If AMZ is thinking long-term, they want the new generation of authors to self-publish first and not even consider querying. They also lose the ability to incentivize people to keep prices at 2.99 +.
I think they are more likely to unbundle KU from Select. But AMZ really likes to go for exclusivity so I don't see them giving that up very easily. They could unbundle Select from KU and give a higher borrow rate if you are exclusive. Still, at the end of the day, I think they will have to increase the borrow rate (substantially) across the board if they want to get the big sellers in. Some of the smaller sellers seem ok with the current borrow rate but the reactions from everyone else is far more cynical. I can't see a significant number of big sellers putting their books into KU in the current climate. And that is who AMZ needs to make KU more attractive to make KU more profitable.
Or AMZ could just dump all KDP books into KU no option to opt out. This would eliminate so much need to worry about what the borrow rate and not intrude with people's ability to make money elsewhere. I might be wrong but I think this is how some of those streaming services work. The indies music can't opt out of the streaming.
I saw someone suggest on kboards that AMZ might try and buy ScribD. But even if they did that I don't see what the advantage would be. The strength of Oyster and Scribd is not platform or technology but their ability to get contracts with the Big 5. The Big 5 are not going renew their contracts with say Scribd if AMZ purchases the company. So then AMZ is left with the same problem. A lack of content. It seems like it would be cheaper to pay a higher borrow rate to indies than the full royalty/borrow a Big 5 publisher might have the leverage to demand.
I also disagree with the previous post that a 1.40+ borrow rate is unsustainable. AMZ is paying who knows how much to publishers with their obligation to pay the full borrow rate. I saw a KU book that was 9.99. So lets assume an indie book is also 9.99 and paying a 70% rate to the publisher. For ten borrows AMZ pays out:
Trad book: 69.93 Indie book (at Dec's borrow rate): 14.30
I think AMZ can afford to increase the borrow rate back to the 2+ mark.
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Post by Deleted on Jan 17, 2015 18:22:29 GMT -5
The only problem I have with assuming AMZ will let KU become some kind of bargain bin is that it assumes that will be profitable to do so. I don't know. Maybe that's their angle. But considering KU seems to be a way to be competitive with ScribD and Oyster I really think AMZ has to figure out how to get more quality content. Although, I think you are right about the long-term part. Maybe years from now the only way to get visibility will be in KU. Or that is the idea. Amazon thinks long term — very long term. They've always been prepared to take temporary losses if it meant gaining market share. And they need to gain market share, because they lost so much of it already they're down to 60%. KU is not just a bargain bin. Remember the last chapter of Animal Farm? Amazon wants the same sort of control over writers the Big 4.5 have. Hence, I think, in the long run they will demand exclusivity from everyone except traditional publisher and the really great names. For the moment they can't give the game away. Already indies are reporting larger sales on Google and iBooks/iTunes. Kobo is growing as well, and in the European market Amazon is just another little guy. As to how to make KU profitable in the long run? How does a payout of 24¢ per borrow sounds to you?  |
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Post by Deleted on Jan 18, 2015 0:16:53 GMT -5
The only problem I have with assuming AMZ will let KU become some kind of bargain bin is that it assumes that will be profitable to do so. I don't know. Maybe that's their angle. But considering KU seems to be a way to be competitive with ScribD and Oyster I really think AMZ has to figure out how to get more quality content. Although, I think you are right about the long-term part. Maybe years from now the only way to get visibility will be in KU. Or that is the idea. Amazon thinks long term — very long term. They've always been prepared to take temporary losses if it meant gaining market share. And they need to gain market share, because they lost so much of it already they're down to 60%. KU is not just a bargain bin. Remember the last chapter of Animal Farm? Amazon wants the same sort of control over writers the Big 4.5 have. Hence, I think, in the long run they will demand exclusivity from everyone except traditional publisher and the really great names. For the moment they can't give the game away. Already indies are reporting larger sales on Google and iBooks/iTunes. Kobo is growing as well, and in the European market Amazon is just another little guy. As to how to make KU profitable in the long run? How does a payout of 24¢ per borrow sounds to you? Point taken on the very long term. Hopefully, Amazon will never truly attain the monopoly status they desire |
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