Publishers Are Following Authors to Kindle Exclusivity

15115777092_5728c0304d_hWith Kindle Unlimited funding continuing to grow month after month and Amazon maintaining its dominance of the ebook market, authors are faced with a quandary:

Do they give up in the rest of the market and go exclusive with Amazon, or do they go wide and sell their ebooks in as many bookstores as possible?

Lindsay Buroker published a post today that asks this very question:

When I uploaded my first book, The Emperor’s Edge, in December of 2010, it was a foregone conclusion that I would put it out there everywhere I could, in the hope that new readers would stumble across it and give it a try. Then, a couple of years later, Amazon introduced KDP Select, a program for self-publishers that requires exclusivity.

Right off the bat, Amazon introduced a couple of promotional tactics that are still available to those who are enrolled. Eventually, Kindle Unlimited and the ability to be paid for borrows also came along.

...

Obviously, if you’re exclusive with Amazon, you can’t receive ebook income from the other stores. Let me emphasize that we’re only talking about ebook income, as you can still have audiobooks in iTunes and paperbacks in Barnes & Noble and elsewhere. But, as you probably already know, ebook income is huge for self-published authors. Even though I’m working on getting more audiobooks out there, and I’ve done paperbacks for most of my novels, ebooks easily account for 95% of my income.

Are you wide or in Select?

Before I go further, I should disclose that I am not in KDP Select with any of the books under my name, but that my pen name is currently “all in” with KDP Select. I started the pen name books there, to take advantage of the sales ranking/visibility boost from Kindle Unlimited, and I returned them to KDP Select this August, after not gaining much headway in the other stores and after Amazon switched to Kindle Unlimited 2.0, a system that rewards novelists by paying based on total pages read.

I won't take a position either way on this topic (I stopped railing against Kindle Unlimited's exclusivity requirement for the same reason I stopped yelling about authors signing their rights away to publishers), but I do have something to add.

Indie authors aren't the only ones doing the maths and trying to decide whether going all-in on Kindle Unlimited is worth it. Publishers are also eyeing Amazon and asking whether they would earn more if they stopped selling elsewhere.

And some have found that the answer is yes.

And just to be clear, I'm not talking about publishers which are in Kindle Unlimited at Amazon's whim and are being paid wholesale each time one of their books is loaned; there are also publishers who have decided to take Amazon up on the offer of being paid for each page read by a Kindle Unlimited subscriber (and all of the restrictions that entails).

There's always been two classes of publishers in Kindle Unlimited (and before that, Kindle Owner's Lending Library). Some were in Kindle Unlimited at the discretion of Amazon, while others joined the service under the same terms offered to indie authors.

Speaking of which, a story's been going around these past few weeks that Amazon has been pulling traditionally publishing ebooks from Kindle Unlimited.  All the versions of the story I've encountered led back to a comment Kensington CEO Steve Zacharius left on Mike Shatzkin's blog.

I reached out to Zacharius by email, and he confirmed the comment. He said that Kensington titles had been removed from Kindle Unlimited by Amazon, and that he "can't discuss terms but anything other than a full royalty for the authors was unacceptable for me and would also create an accounting nightmare".

I also have independent confirmation that Amazon is removing trad pub ebooks from Kindle Unlimited. For example, these titles from Skyhorse were some of the trad pub titles removed this year:

  • A Hunter's Fireside Book: Tales of Dogs, Ducks, Birds, & Guns
  • The Reappearing Act: Coming Out as Gay on a College Basketball Team Led by Born-Again Christians
  • Horses Never Lie: The Heart of Passive Leadership
  • Ibn Saud: The Desert Warrior Who Created the Kingdom of Saudi Arabia

According to Skyhorse, Amazon both added and removed the ebooks at its discretion. “Amazon decides what to include in Kindle Unlimited. They pay us as the publisher per our agreement with them whether or not they sell the ebook or give it away," Bill Wolfsthal, the director of sales at Skyhorse, told me. "It’s their choice on what to charge their customers."

Amazon was paying Skyhorse under terms similar to the ones that Scholastic was being paid when Kindle Unlimited launched. The publishers get a full royalty each time one of their ebooks was read in Kindle Unlimited. The same goes for all the other ebooks Amazon has decided to add to Kindle Unlimited.

Speaking of adding trad pub titles, in the past 6 months Amazon has also added titles from traditional publishers to Kindle Unlimited. For example, I've got a long list of some five or six dozen titles from F+W Media which Amazon added to Kindle Unlimited some time this year.

I won't list all the ebooks here, but I have checked and I can still find the ebooks in other stores. (I'll explain how I know these ebooks were added to KU in a postscript.) So Amazon is removing titles, and they're adding titles, but that's not the most interesting story here.

While I was confirming that those Skyhorse titles and F+W Media titles were available elsewhere, I also identified several publishers that had titles in Kindle Unlimited which could not be found in other bookstores.

Two of the publishers, the UK-based Thistle Publishing and the US-based Limitless Publishing, did not respond to my queries but I am reasonably certain that these publishers have gone exclusive with Amazon in order to take advantage of Kindle Unlimited.

Edit: Just to be clear, I'm talking about an exclusive on digital titles. The publishers still distributed their print editions widely.

I spot-checked a half-dozen ebooks from each publisher (their catalogs number in the hundreds of titles), and cannot find their books in other ebookstores. The publishers also didn't show up when I searched for them by name, but without explicit confirmation there's a chance I could be wrong.

Fortunately, I am far more certain about the third publisher. Ed Renehan, the publisher at New Street Communications, confirmed that he's gone exclusive with Amazon.

He's told me that 56 of the 57 titles published by New Street are exclusive to Kindle Unlimited (the holdout is not exclusive at the request of the author). "For what it is worth, we at New Street have done VERY WELL thus far re: total compensation from per-page reads," Renehan said.

Renehan is seeing the benefit from exclusivity which Hugh Howey identified in August:

You can sometimes reach more readers by making your products available with fewer vendors. By concentrating sales in one location, sales rank gets a boost and more reader reviews are compiled in a single place. This means more visibility and more word-of-mouth sales. It can also mean more readers.

I know that runs counter to conventional wisdom (see John Scalzi for more on this), but Renehan had found that conventional methods just don't work for him.

"We are not distributing anything on Kobo or Nook or any other platform. We've tried & it just does not pay," he told me. "Whereas KU has offered us results we've tracked and found to bring in increased ancillary revenue."

Obviously Renehan's choice won't be acceptable to all (see Zacharius, above) or even a workable option for some, but what does this says about the ebook market?

Here's what I see:

For one thing, there are all sorts of assumptions about Kindle Unlimited which need to be discarded. It's not as terrible for authors and publishers as its detractors say. Renehan has accepted the terms that DBW said treated some authors like second-class citizens, and he's found that to be the more remunerative option that dealing with all the other bookstores.

What conclusions would you draw from this?

OOO

P.S. I know that some titles were removed or added to Kindle Unlimited because they were listed in the raw data for two or more Author Earnings Reports, and that status changed between one report and the next.

P.P.S. I would like to thank Data Guy, Steven Zacharius, Maria Schneider, Ed Renehan, and everyone else for helping with this post by answering my questions.

image by markus spiske

About Nate Hoffelder (11062 Articles)
Nate Hoffelder is the founder and editor of The Digital Reader: "I've been into reading ebooks since forever, but I only got my first ereader in July 2007. Everything quickly spiraled out of control from there. Before I started this blog in January 2010 I covered ebooks, ebook readers, and digital publishing for about 2 years as a part of MobileRead Forums. It's a great community, and being a member is a joy. But I thought I could make something out of how I covered the news for MobileRead, so I started this blog."

29 Comments on Publishers Are Following Authors to Kindle Exclusivity

  1. The obvious answer is that Kobo, Apple, Google et al need to get serious about selling ebooks from non-BPH titles. That all that front page promotion of bestsellers is going to start driving readers (and eventually publishers) to Kindle.
    That they need to do improve their websites, their email promotions, and their small publisher outreach.
    And that they need to start looking into “unlimited” programs of their own.
    Kobo in particular is going to have to seriously rethink their US efforts: relying on hobbyists and internet word of mouth isn’t moving the needle.
    Much like Microsoft in the late 80’s and 90’s, Amazon has been gifted with a set of inept competitors that are driving ebook readers (and now publishers) to Amazon by focusing on the needs and demands of the big publishers instead of the needs of their customers.

    I would also point out that all the NYT and publishing media railing against Amazon actually makes them a safer, more attractive choice for consumers; as long as publishers insist on encryption DRM, consumers will naturally gravitate the strongest, most robust and least likely to fail walled garden.

    Add it all up and Amazon might as well be competing against an empty field.

  2. Ditto to what fjtorres said. And I’ll add:

    Those arguing that indy writers need to go wide and ignore the benefits of Amazon exclusivity for vaguely political reasons (keeping Amazon in check, supporting readers who hate Amazon, opposition to the notion of exclusivity) aren’t doing the indy community at large any favors.

    The only way Apple and others will take indy writers seriously is if they go where the money is. And right now, the money is at Amazon. If Apple wants to be a real player in the ebook market, they need to offer substantially better terms and perks than Amazon to compete. They won’t do that as long as indy writers work against their own interests and publish wide to anyone who sets up a distributor, even if that distributor can’t deliver real sales.

  3. “They won’t do that as long as indy writers work against their own interests and publish wide to anyone who sets up a distributor, even if that distributor can’t deliver real sales.”

    I agree. No point having your books in a lot of baskets if they’re not good, sturdy baskets.

    • I hadn’t considered this point, but Mackay is right in that indies need to work to their own interests. Now would be a good time to ignore those who make recommendations not on an indie’s best interest but “for vaguely political reasons”.

      This is true.

  4. …and not just Indies.
    What applies to single authors publishing their own titles also applies to smaller traditional publishers moving a couple titles a month. What benefit in listing your titles with a bookstore that will hide them behind pages and pages of coop-supported BPH titles.

    Indies aren’t the only publishers that benefit from high ebook margins and Amazon’s level playing field. The sept Author Earnings report actually showed a slight uptick for small and medium tradpubs as a result of the BPHs lost market share. And those folks add up to 20% of Kindle sales vs 25% for the BPHs.

    The ebook “wars” aren’t just BPHs vs Indies but rather BPHs vs everybody else.

  5. I’ve been wide since all the exclusivity started. I did a couple of short stories in exclusive to see how they did, but that was 2 or 3 years ago. This year, in August, for the first time, I moved two books into KU/Exclusive (One is my second best selling first in series-Under Witch Moon and the other is stand alone, Soul of the Desert). Why? Sales at other retailers have been falling pretty steadily the last two years. This past year they fell harder, despite promotion efforts (mainly by Kobo. B&N does no promo that I know of, Google does none, but offers indies a chance to buy ads). I support Kobo’s efforts by cross-promoting them on my own blog and also at my Facebook review site when they run trivia contests, deals and so on.

    I HATED to go exclusive. But I felt I had no choice but to try it to see if it generated interest/reads. It’s interesting to me that Lindsay Buroker also has tried it because she sells a lot of books. Another big author moved exclusive last year too.

    Amazon retaining and gaining is not a good thing for readers or writers. Exclusivity never is. It narrows the market, tends to narrow earning(s) and it usually leads to higher priced books in the long-term.

    Of course, no one ever said this was going to be easy, but I’m not loving the trend.

  6. Right…This might work for indies, but not people with real books. Apple in Australia at least does support indie publisher titles, and their free books selection and promotion is noticeable and VERY popular. Sci fi/Fantasy page right now has a top banner for a self-pubbed book distributed via Draft2Digital. Kobo too have a self-publishing arm, but agree it could be stronger. Front page though? Why exactly?

    Commenters here seem very narrow minded imo. Also, this is food for thought:

    ‘There are now 1 billion Apple devices in the world, each with the iBooks app installed.’ How about Apple responds to Amazon removing Apple TV by removing Kindle app?

    • @ Thomas said: “How about Apple responds to Amazon removing Apple TV by removing Kindle app?”

      The situations aren’t parallel. Amazon doesn’t control a platform like Apple controls iOS.

      And Apple wouldn’t be so stupid, either. Removing the Kindle App would be an outright antitrust violation. The antitrust monitor Bromwich would bill another 50 hours and send a note to Judge Cote saying that Apple had broken the law again.

      There would not even need to be an investigation, not beyond the questions the judge asked in the hearing. And then Apple would get slapped down – HARD. They would be fined, at a minimum, and Judge Cote would throw the book at them.

  7. Also please note I don’t really disagree with anything said here, nor the sentiment, but while the commentary and articles are great here, the commenters are very one-eyed, let’s be honest.

  8. Given how it was documented during the trial thst Apple used the appstore to pressure Random House into joining the conspiracy any attempt to use iOS access to reduce competition in ebooks would be, as noted, an instant antitrust violation and cause for more than just fines. Forced divestiture comes to mind as a likely remedy.
    At that point Apple would be a three time loser so getting the book thrown at them would be unavoidable.

    • I don’t know about a divestiture; I think the more likely outcome of Apple’s abuse of power would be for Cote to tear down Apple’s walled garden.

      Apple would be forced to give up control of apps on iOS. Would that be a divestiture, or simply the platform being opened up?

  9. Apple, Kobo, Barnes and Noble, wanted it all handed (Agency) to them with no work. Amazon works to be number one. B&N or Kobo saying they can’take compete unless their is fixed pricing is just lazy.

  10. Smart Debut Author // 6 October, 2015 at 9:54 pm // Reply

    “This might work for indies, but not people with real books…”
    and then:
    “Commenters here seem very narrow minded imo…very one-eyed, let’s be honest.”

    Guess self-awareness isn’t really one of your strengths, Thomas. 😀

  11. **edit**
    B&N and Kobo saying they can’t compete is just lazy***

  12. lol

    Anyway, if you think it’s laziness I just don’t know what to tell you.

  13. a) No shit about anti-trust, that wasn’t the point.

    b) Don’t have a tanty over ‘real books’ comment, you know what I mean. These are spaces for trad books, there are plenty of spaces for self pubbed ones – namely Amazon.

    The common theme here seems to be commenters take the easy route vis a vis arguments and just ignore the hard stuff.

  14. “Amazon retaining and gaining is not a good thing for readers or writers. Exclusivity never is. It narrows the market, tends to narrow earning(s) and it usually leads to higher priced books in the long-term.”

    I don’t see any evidence of this. The market, at least in terms of the number and range of titles available has grown thanks to Amazon. Total earnings for indy writers are growing, and the number of indy writers making real money is growing. And, if anything, Amazon is encouraging lower pricing.

    No one is being forced into exclusivity. Amazon makes it pretty easy to drop in and out of it. And it also allows print non-exclusivity. Why shouldn’t Amazon, like any other business, reward suppliers who make some of their products exclusive? And why should some suppliers take them up on it?

    Exclusivity is the way creative artists make big bucks. You have to have HBO, to see the latest HBO series. IMAX gets an exclusive first run of a major blockbuster film. Frank Sinatra makes a deal to only perform at the Sands. Famous actress agrees to only promote one line of perfume. This is a good thing, not a bad thing for artists. It means companies are fighting over us.

    Likewise, it is simply a reality of technology that people prefer to have most of their content on a single platform. That’s been true since Window took off, and it’s true as Android and iOS rose in popularity. It’s also true in gaming where people flocked to Xbox or Playstation. Amazon’s ebook platform is simply better than any of the others, and it’s silly to sit around wishing that weren’t true and that there just happened to be a bunch of platforms with equal appeal and sales. It’s never going to happen. But that being said, Amazon could lose share fairly quickly if some other company came up with a better platform. (See Blackberry.)

    The problem right now is that Apple doesn’t appear to be interested in promoting their iBook store. (Probably waiting for the Supreme Court review.) Apple offers all sorts of exclusive deals and perks to musicians for exclusive rights, and they will do so even more in the future. What we want is for Apple to offer special incentives for indy writers to be exclusive that are even better than Amazon’s.

    Hopefully, at some point Google will realize that the indy market is where the real action is and change it’s policies and actively compete for indy writers too.

    In the meantime, Amazon is the only company that seems to understand the value of indies, and work on ways to directly promote and reward them.

    Which isn’t to say that those writers who are doing well going wide, or on some other platform, shouldn’t speak up or continue what they’re doing. But they should make their decisions based on evidence, not on a “political” stance that has nothing to do with reality and won’t effect market forces. Or, as I said, actually make market forces worse because there is less pressure on new platforms to truly compete.

    Also, I have no idea what Thomas is talking about in terms of commenters being narrow minded. I’m a huge Apple fan and it pains me they don’t do a better job with iBooks. I’m holding out hope that will change.

  15. Just a general feel I’ve noticed. Agree with you, and tbh I wouldn’t be surprised if Apple does have something up its sleeve.

  16. I don’t agree that Kobo and Nook need to push indie titles as much as Amazon. It is difficult to find anything worth reading by browsing the Kindle store because it’s overrun by poorly written indie titles (which are the majority). Kobo allows and promotes indie, but they mostly curate the big 5 works. That leads to a better shopping experience for the average user.

    I really think that indie publishing is in a bubble now that will burst sooner or later. The sheer amount of content shows that everyone and their third cousin are trying to cash in on the ease with which one can publish an eBook on Amazon. But demand is not on par with supply. There is a place for self published works, but not at the level that it is now. Sooner or later those writers will become frustrated with how little they are making and turn towards conventional publishing, or perhaps something else that does not exist yet.

    Kindle Unlimited in particular I don’t see continuing to grow indefinitely. Indiscriminate avid readers are limited in number. And writers that can write readable prose are going to sell enough on their own to not use Unlimited.

  17. “Sooner or later those writers will become frustrated with how little they are making and turn towards conventional publishing, or perhaps something else that does not exist yet.”

    I don’t understand this statement. Why in the world do you think that authors make *less* money self publishing than they do if they go with “conventional” publishing?

    Shari

  18. @Shari: there are some folks whose entire focus in publishing is guided by “reader spend”, retail gross dollars extorted from readers, not net dollars delivered to the author. So they see a deal that sells 3000 tradpub copies at $15 each, delivering $6000 net to the author, as superior to an Indie deal that sells 10000 ebooks at $2.99, delivering a net $28000 to the author, because the former grossed $45000 and the latter only grossed $30000.

    It’s a mindset thing: “*my* fans will pay $15 for my books but yours will only pay $3, nyah,nyah.”

  19. Nate, more likely hire a good marketing person?
    How much more likely?
    1% more likely?

    The randy penguin is putting out well over 15,000 titles this year; how many of those are getting “a good marketing person” behind them? Or even a so-so marketing person?

    You yourself have repeatedly linked to articles highlighting the fact that tradpub does not as a rule do any significant marketing for the vast majority of their titles; they simply can’t afford it. (KKR ran an entire column documenting the prices of even *one* quarter page ad in a limited circulation trade publication.)

    http://kriswrites.com/2013/11/20/the-business-rusch-advertising-print-editions-and-traditional-publishing-discoverability-part-one/

    Now, if a tradpub title for one reason or another has intrinsic legs (author track record, topicality, etc) or breaks out on its own *then* tradpub *will* do some serious promotion for it. But that is after-the-fact promotion, not pre-launch marketing.

    Tradpub marketing is a myth unless you are already a big time author like King or Patterson.

  20. Mackay’s response to Thomas certainly struck me:

    “I don’t see any evidence of this [drawbacks to exclusivity]. The market, at least in terms of the number and range of titles available has grown thanks to Amazon. Total earnings for indy writers are growing, and the number of indy writers making real money is growing. And, if anything, Amazon is encouraging lower pricing.”

    Amazon has done so much to positively help shape the e-book market, but I think it’s a mistake to not look at this from a long-term view. A diverse ecosystem is almost always better, and this applies to the e-book market too.

    In the short term MacKay’s points are valid, in the long-term? Not so much. The more Amazon dominates, the more they will look out after their own interests with the knowledge that authors and publishers have no other options. This is not to say that I am a huge fan of traditional publishing, don’t get me wrong.

    But here’s some food for thought: Not long ago I looked at an author’s contract with Amazon which in the legalese mentioned Amazon’s exclusive right to publish it “throughout the universe.”

    MacKay makes the point that Amazon isn’t “forcing” authors to go exclusive. I think a good response to that is “Oh really? Just wait.” Contrary to popular belief, there are actually other e-book distributors out there who have put together some profitable models and which treat both authors and readers in some ways better than Amazon. Their lack of ability to compete with Amazon isn’t a signal that they are “poor” competitors – it has much more to do with Amazon’s extraordinary resources and leverage.

    Despite Amazon’s contributions, like any market player, they are prone to abuses and the question I would have, as an author, as a reader, whoever you may be, is this – Would you rather have the option to vote with your feet and move to another platform? Or would you rather be stuck with a much less palatable option – Amazon or nothing?

    I know which world I’d rather live in, and by the way, this is coming from someone who thinks that Amazon has had a more positive impact on publishing in may respects than all the traditional publishers combined.

  21. ‘I know which world I’d rather live in, and by the way, this is coming from someone who thinks that Amazon has had a more positive impact on publishing in may respects than all the traditional publishers combined.’

    This needs some concessions, such as ‘…a more positive impact on publishing in recent years…’.

  22. This article is an example of a google ads fail. It’s ad banners are cutting off the text. Before we know it, we will only get to read half the article (sliced in the middle of screen) as we continue making room for the voracious google.

3 Trackbacks & Pingbacks

  1. Hump Day #Rants and #PublishingNews | Love's Last Refuge
  2. Now Kings of ebook subscription, what will impede the ebook share growth for Amazon? - The Shatzkin Files The Shatzkin Files
  3. Amazon Reportedly Actively Recruiting Publishers into Kindle Unlimited | The Digital Reader

Leave a comment

Your email address will not be published.


*
http://the-digital-reader.com/2015/10/05/publishers-are-following-authors-to-kindle-exclusivity/
the-digital-reader.com
crawl=CC-MAIN-2016-26
118223
application/http; msgtype=response
sha1:4CKA5LMZJBVV7ERXUS6P2KVHVRJTF3P6
<urn:uuid:e062650d-bb39-470a-86a0-eb374e84db40>
2016-06-27T02:04:47Z
104.28.13.126
sha1:5XYKIIBDDHA2DWQSP6EXL3WG777IE7JG
<urn:uuid:fce1baad-6752-4d94-b762-edf228b915d9>
http://the-digital-reader.com/2015/10/05/publishers-are-following-authors-to-kindle-exclusivity/
length
response
<urn:uuid:f81719d7-9232-4c42-b4c4-9ffd7d7abe17>
robots: classic
hostname: ip-10-164-35-72.ec2.internal
software: Nutch 1.6 (CC)/CC WarcExport 1.0
isPartOf: CC-MAIN-2016-26
operator: CommonCrawl Admin
description: Wide crawl of the web for June 2016
publisher: CommonCrawl
format: WARC File Format 1.0
conformsTo: http://bibnum.bnf.fr/WARC/WARC_ISO_28500_version1_latestdraft.pdf