Kindle Unlimited

In the short term, this will likely be a boon for many authors and/or their publishers (where applicable). It's the long term where lies the danger to both authors and publishers.

Amazon might lose money in the short term—consider that early adopters are likely to skew towards heavy readers—but Amazon doesn't profit anyway, so that's clearly not an issue.

Like dumping best sellers below cost before it, Kindle Unlimited is a calculated effort to train customers that books have no value.

By perpetually pushing down the perceived value of books, Amazon puts eternal pressure on other retailers. The goal is to make book retailing so unprofitable that no one else will bother.

There are two competitors who can afford to not make a profit on books, and that's Apple and Google. Whether or not they're willing to do so remains to be seen, but a successful Kindle Unlimited will take us closer to them needing to make that decision.

This pricing pressure will also affect publishers, of course. As readers are reshaped to expect books for little or nothing, we'll see more consolidation, fewer small publishers, and a further pullback on acquisitions and development.

That will push more authors to self-publishing (through Amazon), and boom, Amazon continues to win at the expense of both authors and readers who love great books.

GeekTells said:

In the short term, this will likely be a boon for many authors and/or their publishers (where applicable). It's the long term where lies the danger to both authors and publishers.

Amazon might lose money in the short term—consider that early adopters are likely to skew towards heavy readers—but Amazon doesn't profit anyway, so that's clearly not an issue.

Like dumping best sellers below cost before it, Kindle Unlimited is a calculated effort to train customers that books have no value.

By perpetually pushing down the perceived value of books, Amazon puts eternal pressure on other retailers. The goal is to make book retailing so unprofitable that no one else will bother.

There are two competitors who can afford to not make a profit on books, and that's Apple and Google. Whether or not they're willing to do so remains to be seen, but a successful Kindle Unlimited will take us closer to them needing to make that decision.

This pricing pressure will also affect publishers, of course. As readers are reshaped to expect books for little or nothing, we'll see more consolidation, fewer small publishers, and a further pullback on acquisitions and development.

That will push more authors to self-publishing (through Amazon), and boom, Amazon continues to win at the expense of both authors and readers who love great books.

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Wow. This, and everything about this.

It seems like there aren't very many trade published books on Unlimited, compared to Oyster and Scribd. So I think this will mostly affect self-publishers and some small presses for now. Maybe Amazon will convince some bigger publishers to join in as time goes on.

I hope not, though. Subscription services like Netflix and "free trial" sites like Hulu work because there's a different profit model for movies and music than for books. Ad revenue is what powers those sites. But here, it's just the subscription price, which is bad for the content producers.


Also, people are forgetful and like shiny things, and I dislike how Amazon is trying to capitalize on that. Instead of cheap tricks, I respect a business that puts out a quality product at a decent price. And if Amazon wasn't so greedy, they could be a company like that. Oh, well.

As long as writers write quality books, readers will value those books, no matter what the price. Price is not the same as value. You can get Shakespeare for free on Kindle; does that make Shakespeare worthless?
I have no opinion on this new move; I'm waiting to see how it develops. Negative speculation and predictions really only bring on the sky is falling emotions.

aruna said:

As long as writers write quality books, readers will value those books, no matter what the price. Price is not the same as value. You can get Shakespeare for free on Kindle; does that make Shakespeare worthless?

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There are many types of value. For writers who want to be able to commit more time to writing, the monetary value of books is important. You can be the most critically acclaimed author in history, with millions of people having read your book, but that doesn't put food on the table unless those readers also paid a fair price for it. Shakespeare is dead. But you can bet when he was alive, he would have defended the value of the product that allowed him to make a living.

I believe that books of value -- even if that value is subjective, and decided by readers -- will always sell.

I don't know what Shakespeare would do if he were alive today. And I don't think that fighting for what is right means worrying about the future. Nor do I believe that not worrying means you are jus going to sit twiddling your thumbs. I am not worried. I have written the best books I can, I believe they are of value, and I believe they will find their readers, who will pay for them. Low prices do not worry me. They mean more sales, not less value.

I simply don't believe in painting dire scenarios before they are actually, you know, here. I always cross my bridges when I get to them -- such as my present dispute with HarperCollins, which I am not taking lying down -- and that's the way I will proceed with this development.

I'm just suggesting an alternative perspective. There's a saturation point with any product, where further decreasing the price is unlikely to generate more volume, and therefore it only hurts revenue. I don't know that anyone quite knows for sure what that point is yet, but I think we're getting a lot closer to it than we used to be.



Whether or not someone will pay for something if they can get it for free or cheaper than is really needed to sustain production is a complicated question. It has been my experience that many people, especially if they are ignorant of the issues of intellectual property rights and how people make a living off of intellectual property, they are much more willing to take things for free even if theoretically they should be paying.





Personally, I don't think open discussion is a bad thing. I learn more about the publishing industry every time we have a similar thread, whether there are dire predictions made or not. In that sense, I think these threads have some value.

Cheaper books leading to more sales is actually a compelling argument to make. Someone more charitable than might suggest that such is Amazon’s only goal, to get more books into the hands of the masses.

O Great Bezos! Lead us to literacy!

But seriously, take the music industry. In the 90s, the labels started jacking up CD prices even while production costs (both in the studio and of the physical product) were declining. They were minting money. Hoorah! Quick fun fact: music sales increased in the wake of Napster’s rise. I loathe piracy of any sort, but the music industry put enormous effort into cutting off its nose to spite its corporate face.

In any event, Apple came along and pitched iTunes, insisting that a la carte singles be available, that albums be capped at $9.99, and that single be capped at $0.99.

The labels agreed, and then were furious when iTunes took off. Music sales shot up again, and the labels grew angrier and angrier that Apple had all the control, even though they themselves had failed utterly to deal with the digital age.

Eventually, though, they used the cudgel of DRM to regain the power to price music higher. They would allow the sale of DRM-free music through iTunes (they had already given Amazon and a few competitors this ability), but only if Apple would allow variable pricing, including higher prices on singles and albums. They got their wish, and surprise, digital music sales began declining.

I argued repeatedly (years ago) that labels should sell singles for $0.25 and albums for $2.99 or less. The labels appeared uninterested in my opinion, but my gist was that with online distribution, unprecedented and massive competition for entertainment dollars, and the ability for consumers to store and carry around an immense quantity of music, that such low prices were appropriate and would increase music sales.

By this same logic, cheaper books would also lead to higher sales—and certainly there is an optimal price point (or range). There are many differences between music and books, however, starting with how long it takes to produce the content (I professionally recorded an album with a band in a weekend a few years ago, for instance).

More importantly, there’s the consumption experience. Music can be listened to in just a few minutes, less than an hour for most full albums. There is no limit to the amount of music we might want to have access to at any given moment, but there is a hard limit to the number of books we can read in a given year.

I can’t back this up with studies or hard data, but my personal opinion is that we have already crossed that optimal pricing range. That from here on out, lower prices will only limit the ability of publishers to acquire new authors and develop them. Established superstar writers will continue to do well, while the next generation(s) of writers is(are) forced to do their best to develop on their own.

But all of this philosophical stuff is irrelevant to the discussion of Kindle Unlimited or the broader threat Amazon represents to the publishing industry. Amazon is not trying to drive down prices to increase the number of books sold, it is doing so to eliminate retailing competition, and ultimately publishing competition.

True story: Don Quixote looked up “quixotic” in the dictionary and found a picture of me on my Vespa wearing a parka and a skinny tie. I’ve been writing about Apple as my day job since 1998, when Apple was near death. I love a lost cause!

But at the end of Amazon’s book vision is an ebook platform that stops improving, physical book stores being less common than LP record stores today, and 90% of books being self-published. Want a publishing deal? Sell 100,000 Kindle books and you and a publisher can talk, assuming you even want a publisher any more.

Personally, I want help from publishers. I want an editor to send me a note asking me what the fuck I was thinking when I had my character(s) do something that don’t make sense. I want someone to catch all my copy mistakes. I want someone who’s job is to catch the fact that I started spelling a city’s name differently 2/3 of the way through my manuscript.

Amazon’s goals make that sort of help unviable for all but a handful of authors who can move big numbers.

As an aspiring author, that’s a bad future. As a lover of great books, it’s even worse.

Sorry about the epic-length post.

Books and music are not in the same bracket when it comes to income. A musician has alternative methods of collecting income. Before musicians made money from selling records and CD and touring was the sidebar. Now they make their income from shows because there is little money to be made from tracks or albums elsewhere.

Personally, that is not an option for me as a writer. Every time amazon rushes to the bottom in its attempt to undercut the value of my writing, it affects my income(such as it is). I don't have the option of tours or shows or another way to make income from books.

There are absolutely alternate business plans for authors that aren't trade publishing.

Well, for some authors. But just because one person can make it on their own as a self-publisher and move millions of copies, that doesn't mean everyone can manage the same with the same plan, or even that every author would want to structure their career like that.

But here's what everyone who says "survival of the fittest" or some version thereof. Trade publishing is absolutely still a viable model. Even with physical bookstores declining and the growing ease of getting onto electronic platforms. It's totally possible to have competing models out there serving different needs for different people.

But Amazon doesn't want that. Amazon has a model in mind, and they want it to be the only model, and damn whoever doesn't like it. And the people who have a viable model that isn't Amazon's are frustrated, and they deserve the right to be frustrated.

Oh horrors! Amazon has a new marketing scheme! The book industry is doomed!

Get over it. Same thing was said about digital books. Television. Radio. Moving pictures and talkies. Heck, even that cretin Gutenberg and his printing dohickey ruined books forever.

Jeff

I remember being horrified at the very idea of e-books. Just a few years ago.
Little did I know that e-books would be the saving of my novels, including my entire collection of unpublished mss! I just don't believe in panic. Let's write good books, the best we can, and see where that takes us.

Sage said:

I'm not all pro-Amazon on this, but I'm wondering why we think that a subscription lending program devalues books but a free lending program (libraries) does not.

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We know how libraries work and we know that Amazon does not work the way libraries work.

WeaselFire said:

Get over it.

Jeff

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Not sure what the callous dismissal adds to the conversation, but suffice it to say I, for one, am not going to "get over it" until we know a bit more. I'm happy to watch things play out for a while, but that doesn't mean I won't spend some time thinking about what the end game might be.

Sage said:

I'm not all pro-Amazon on this, but I'm wondering why we think that a subscription lending program devalues books but a free lending program (libraries) does not.

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For me, it's just scale.

I don't think of this in terms of the "value" of books, which strikes me as something esoteric involving more than price. My concern is far more crass: how much money will the author be paid for the read? What happens if the pool of money shrinks? The author gets 3 pennies rather than a dollar? So far, I haven't seen any bottom set, only Amazon's assurance that everything will be fiiiiiiiiine.

The thing is, as far as we know to date, this is not compulsory. Self publishers have to be in Select. Trade publishers have to opt in. Mine has not done so yet, so we will see. It seems to be an option, not the way all books will be sold. I personally prefer not to be part of it. But I can see an advantage to some books. If a self-publisher doesn't want it, he or she can opt out of Select right away.
I really like that old saying, nobody knows anything.

Sage said:

I'm not all pro-Amazon on this, but I'm wondering why we think that a subscription lending program devalues books but a free lending program (libraries) does not.

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I don't know. I've lived my life in smaller communities, so the libraries typically had a small selection of books by a given author. If I found a story I enjoyed, I'd then go on to buy other books by the same author. Sometimes I'd also buy the book I'd previously checked out, so I could have my own copy.

Since I often borrowed books I wouldn't have splurged on in a bookstore, I discovered authors I never would have without a library. In my case, libraries did help sell books by introducing me to works I might never have tried.

The world and book sales have been changed by technology, and I have no idea how to predict what will happen next. It does worry me a little that authors might not be making the money they used to.

I'm in wait-and-see mode.

My publisher DID opt in, so for the moment I have decided to embrace it.

I have no idea how much I will get paid per 'read' - I'm assuming the terms on this might vary from publisher to publisher.

Sort of surfing the forums this weekend seeing what other authors and readers make of the deal....

Right, libraries have a very different model.

Libraries buy books with taxpayer money to lend out to members of a certain community. If you are not in that community, no dice -- so each community, if a community is going to read a book, needs to pay for that book.

Also, if a library wants to rent out more of a certain book, they will need to buy more copies to do so. They might have five copies of Twilight and that still didn't keep up with demand. If somebody doesn't want to wait for a popular title, they may just go out and buy the book. Library ebooks also work this way because of the way Overdrive makes them work.

And that's just the theoretical difference in price model. In actuality libraries tend to have holes in their collections and be lacking in newer books, meaning that if you want, say, the 3rd in a new series, you may be out of luck at a library and be forced to buy it elsewhere. However, if you want to read a more classic book, you'll probably be in luck, as long as you're not so picky as to which it is.

Because of this, library books are most frequented by people who cannot or don't want to spend money on books for whatever reason. Such people are forced to be less picky and therefore are not so annoyed with such limitations.

An electronic service like Amazon giving unlimited access to books for $10 a month has none of that structure at all. They have no boundaries that would force them to buy multiple "copies" to provide to various communities, they do not have to buy multiple copies to keep up with lending demands, and there's no reason for them to have holes in their collection aside from not being able to strike a deal with certain publishers, so there's no reason for, say, all of one author's books to not be easy access.

Because of this, this model relies on being able to spend less on "renting" the book out than it is to let people read it. If we assume the $2 figure posted earlier is correct, and that there's no publisher's cost or something, they're banking on people, on average, reading less than 5 books a month.

Which, for the majority of people, I guess, is pretty reasonable.

...

I still don't trust Amazon.

Hapax Legomenon said:

Right, libraries have a very different model.

Libraries buy books with taxpayer money to lend out to members of a certain community. If you are not in that community, no dice -- so each community, if a community is going to read a book, needs to pay for that book.

Also, if a library wants to rent out more of a certain book, they will need to buy more copies to do so. They might have five copies of Twilight and that still didn't keep up with demand. If somebody doesn't want to wait for a popular title, they may just go out and buy the book. Library ebooks also work this way because of the way Overdrive makes them work.

And that's just the theoretical difference in price model. In actuality libraries tend to have holes in their collections and be lacking in newer books, meaning that if you want, say, the 3rd in a new series, you may be out of luck at a library and be forced to buy it elsewhere. However, if you want to read a more classic book, you'll probably be in luck, as long as you're not so picky as to which it is.

Because of this, library books are most frequented by people who cannot or don't want to spend money on books for whatever reason. Such people are forced to be less picky and therefore are not so annoyed with such limitations.

An electronic service like Amazon giving unlimited access to books for $10 a month has none of that structure at all. They have no boundaries that would force them to buy multiple "copies" to provide to various communities, they do not have to buy multiple copies to keep up with lending demands, and there's no reason for them to have holes in their collection aside from not being able to strike a deal with certain publishers, so there's no reason for, say, all of one author's books to not be easy access.

Because of this, this model relies on being able to spend less on "renting" the book out than it is to let people read it. If we assume the $2 figure posted earlier is correct, and that there's no publisher's cost or something, they're banking on people, on average, reading less than 5 books a month.

Which, for the majority of people, I guess, is pretty reasonable.

...

I still don't trust Amazon.

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Actually, aren't public libraries on some kind of network now? My friend went into our local branch and requested a book, it was in the network, but not at that facility. He opted to put in a request for it anyway and, though it took a few weeks, they got the book shipped up from another library.

Also, it seems that selection on KU is pretty limited, and it's up to the authors or their publishers whether a book is available or not. And as books are put into Kindle Select on an individual basis, it wouldn't be a major deal at all to put in the first book or two in a series and then leave out the rest.

Around me it's just metro wide. It depends on the library and community.

ShaunHorton said:

Also, it seems that selection on KU is pretty limited, and it's up to the authors or their publishers whether a book is available or not.

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This, I think, is the crux of the matter. If authors and publishers refuse to put their books in, because they are not fairly remunerated, the project will flop. If it works, if authors ARE properly paid, more will want to opt in.

In the end, Amazon needs us more than we need them. There could always be an alternative to Amazon, some other opening for us as "content providers" (I hate that word!) But if Amazon wants to sell books, then it needs authors. And to get authors it needs to treat them fairly.

It really is "wait and see".

Well there are alternatives, oyster and scribd, and from what I hear they seem to be doing pretty well.

I guess the thing is that I don't know if people actually prefer a subscription model to ownership, even if what you're subscribing to versus owning is just a digital file. And, with books averaging $10 a pop anyway, I think a lot of people who don't go through more than one book enough will realize it's not worth it.