The Birth of the New Book Market

//The Birth of the New Book Market

Yesterday, I watched a documentary about the rise and fall of Napster, and it made me think. It made me think of how good things are for indie writers in the new digital book world. If we didn’t have Amazon leading this switch to digital, we might have had some Napster-for-books start-up with free sharing, ripping of books, a hot race to the bottom in terms of pricing and structure. I say this, because over this past weekend weekend, I had an interesting reaction to seeing part of my (per unit) revenue from Amazon drop due to the new Kindle Unlimited subscription model.

For those of you that aren’t familiar with it, Amazon unveiled a new “Netflix for books” called Kindle Unlimited that lets readers access an unlimited number of about 600,000 books (about 25% of all 2.4 million books on Amazon) for $9.99 a month. This isn’t the first subscription model, there are others from Oyster and Scribd, of course each with their own licensing deals, but Kindle Unlimited is the first from Amazon, and a potential game-changer (to use that over used word).

What gets writers (like me) concerned, is the per-unit revenue that Amazon shares with writers when they let someone read a book through Kindle Unlimited. In the music business, subscription models like Pandora and Spotify need to have an artist’s song played about 10,000 times (I’m averaging, their actual payments vary, but this is a good order of magnitude) to generate revenue to the artist equivalent to one CD’s worth of revenue. Amazon does much better than this. Through their “Kindle Owners’ Lending Library” program, they pay about $2 per book that is read “for free” by Amazon Prime members. This payment is now extended to anyone who reads a book “for free” under Kindle Unlimited.

The issue is that, doing a quick calculation on the per-unit royalty Amazon started paying since the new Kindle Unlimited program started, it dropped from about $2.24 in June of 2014, to about $1.14 from July 18-31 when Kindle Unlimited started.

My initial reaction was a knee jerk, “hey, Amazon is going to screw us” response…but on further reflection, that was the wrong reaction. The new subscription model does throw a wrench into things, forcing me to think of maybe changing the way I write, what titles I put out. This felt uncertain and made me want to say, “Just leave things the way they were, I was doing good the way they were.”

The point that many other writers have made is that this will skew writers to start producing more short stories and short content so that they can live with about $1 per copy…and will push people away from producing full-length novels. That might happen, but honestly, writers will just have to adjust if this is the case.

After my initial reaction, the further reflection part that made me laugh was that my reaction was the same one that established publishers, authors, etc–anyone in the business already making a business of it–is feeling about this whole switch to digital, the churn in the market and so on. The whole fight between Hachette and Amazon, and all the other struggles in birthing this new book market came into focus.

Everyone has a different perspective, an entrenched interest, careers in the balance and families to provide for. In that context, I have a lot more sympathy for everyone involved. This personal reflection generated a wave of outward sympathy in me for everyone involved—for publishers, established writers, up-and-coming writers–we’re all in this together, we’re all trying to make a living from it, and right now a lot of it is up in the air. Then again, as a writer, everything is ALWAYS up in the air.

I have to remind myself that this is just business, and that Amazon has been awfully good to me–and for me–in the past year, so I should give it time to see how things turn out before complaining about anything. We’re upset that we might be getting only a $1 to $2 for a “free” book read on their platform, but if Amazon hadn’t been there, we might have been getting close to nothing. Either that, or the big publishers might have controlled the digital platforms, in which case it would have been business-as-usual with little chance for indie writers (which would have spurred on the copyright infringing free sites).

The switch to digital was inevitable. Amazon is just an agent of the change, not the change itself. On the balance, Amazon has been good to us writers. So I, for one, am going to roll with the punches and see what they come up with. We’re probably all going to have to roll with the market a few more times before things settle down. In fact, it’s a certainty.

2018-02-20T07:40:01+00:00

About the Author:

Books translated into 16 languages and CyberStorm now in development for film by 20th Century Fox

2 Comments

  1. James McCormick August 21, 2014 at 10:35 pm - Reply

    I agree that if it changes, it changes.

    1) I’m not sure the “Netflix” model is the best model. I mean, just look at Netflix. It’s difficult to find content that’s above 3 stars. When searching for specific titles, quite often, they aren’t available. The Netflix model is a mixed bag, at best.

    2) It seems like Amazon is undercutting their previous model with this current one. A subscription fee with a flat rate has a ceiling. Whereas, a 30% cut of all books uploaded to Amazon does not.

    I don’t really understand Amazon’s motivation to want a subscription service like this in the first place. Seems to me, that more popular writers with devoted fanbases will opt out of Select (which many do anyway, so I guess it’s no big deal).

    I also think the price of the sub service is too low. It’s basically the price of 2 eBooks, which pretty much makes it the only choice for many readers. Or the eBook price of a Big Publisher’s eBook… Now, I think I see Amazon’s motivation.

    3) Shorter content is not what most people want. Smashwords, Data Guy, and a host of other sources have shown that sales rise @~100k words.

    And digital formats have no problem with excessively long books.

    I agree that a sub service lends itself to shorter more frequent content. Which is fine. But give us that prefer writing novel length stories an alternative. You can’t be in Kindle Select without also being in Kindle Unlimited. It pretty much ties authors hands on the type of content they have to write.

    And yeah, my reaction might be knee-jerk, as well. We’ll see if the KU exposes authors to a broader audience. Maybe it’ll be worthwhile, even at a loss, even with the ceiling. I’m open to it, just skeptical.

  2. Bryant October 11, 2014 at 4:13 am - Reply

    I like the Amazon unlimited. I don’t normally read this kind of genre but having the unlimited I am reading your first book and just put your other books into my que. I am actually spending more on books now. A lot of the series that I have been reading only one maybe two books are on unlimited and the rest of the series i have to buy which I do gladly because the series is so good. Maybe if your getting paid to little per person. Put some books that people have to pay for. I am definitely a fan of your writing now.

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