How Amazon has us ensnared in our own trap

Some thoughts by an indie author about Amazon Kindle Unlimited (KU), the subscription service of Amazon.

A simple question for the authors who have opted in KDP Select, making their book eligible to Kindle Unlimited subscribers : do you know what will be the page rate in KU for August?

I bet you don't. Because nobody does. It depends on a variety of factors (number of page reads, number of titles and authors, amount Amazon is willing to pour).

With KU, the rule will change from month to month. That's what I call obfuscation. You can't be sure of anything from month to month.

The normal system of sales is clear. It still exists. But it is no longer the dominant one, as the testimonies of the authors who are on KDP Select establishes: provided they were already selling some ebooks on Amazon, they get more borrows than sales.

This trend will only increase, because we all know that the heavy readers who have subscribed in KU borrow more ebooks in a month than the other people who are limited by price and are not heavy readers.

Self-published authors have a common interest. We all need that Amazon's competition thrive in order to put our ebooks there. Being dependant on one retailer alone is absurd and dangerous, even if I have to acknowledge that it's more simple for the authors.

But the easiest way is not always the better way.

I name "borrowing system" a system where the authors (and books) visibility is based mostly on borrows rather than on sales. Imagine Amazon's KDP is a train. The locomotive of this train, what drives sales, is now borrows.

Not exclusively, because you can get sales because of books you put for free (you put number 1 free and you have a sale on number 2 when enough people download the first one, provided they like it).

You can also get sales by advertising, of course. 

But still. Imagine you are an author. You have the choice of being paid (not much) for an ebook that will deliver a visibility far greater than the visibility of a free book, because that ebook available in KU is listed under the paid tab.

The paid tab on Amazon gives you better credibility than the free tab. For authors who are savvy marketers, that's a no brainer: each time your ebook is borrowed on KU, your ranking improves, and the authors who sell had much more borrows than sales in July. It's natural: you borrow more when you just have to pay $9.99 a month.

This greater visibility of the ebooks borrowed add up for all the authors who go exclusive with Amazon. That means that the ebooks that will increasingly be ranked in the top will be KU ones. But the payment for these ebooks is lesser than with the classic system (something like $1.12 for an ebook of 200 pages). 

And it will probably decrease, because KU, as it is, is not sustainable by itself.

So, yes, the indie authors become increasingly competitive, and the traditionally published ebooks will suffer a lot more. But the amount sacrificed by the authors will be staggering.

And of course, these ebooks that will increasingly get to the top are KU ones, so the indie authors not participating in KU are screwed big time.
Amazon's interest diverge from authors, because Amazon has us ensnared into our own trap. We indie authors used to compete with trad pub with cheaper prices. But now, Amazon makes KU authors competing with non KU authors with cheaper prices, and by accelerating the race to the bottom, Amazon makes its store increasingly attractive to the heavy readers.

So, it's good for Amazon because these readers will also spend their money elsewhere on Amazon.

That's the big problem in dealing with the everything store: Amazon uses the indie authors' ebooks as loss leaders.

Amazon loses money with KU, but Amazon makes it back elsewhere, whereas the authors will be more and more fighting for crumbs, and not for real money.

And Amazon has done all that by inventing this "borrowing system", a system where ranking is mostly driven by borrows.

In a real economy, ranking should be driven by sales. Amazon has instituted a fake economy. This is already detrimental for a lot of authors, and it will be increasingly detrimental, even for KU authors.