Are Indies Treated Like Second Class Citizens?

Does Amazon treat indies like second class citizens?

I’ve seen a few comments to this effect since Kindle Unlimited launched. The argument comes from the fact that self-published authors are paid from a shared pool for ebooks borrowed through KU, while traditionally published titles receive the same payout they would get for a regular sale. Since KU launched, self-published titles have earned in the neighborhood of $1.30 – $1.60 for each KU borrow (if the title is read to the 10% mark).

Another complaint about KU is that it ignores price for indies, so a 99 cent ebook and a $9.99 ebook both pay the author $1.30-ish for a borrow (again, if read to the 10% mark). A $9.99 ebook borrowed from a trad publisher, meanwhile, will pay 70%, which comes to $6.99.

It’s worth pointing out here that the trad-pubbed author of that ebook will only receive around $1.48 for that same borrow of a $9.99 ebook. And the trad-pubbed author of a $4.99 ebook borrowed through KU (which is a better comparison to indie pricing) will receive a mere 74 cents! So a comparison of earnings between authors on either side is actually much better for the self-published author.

But wait, you say, we aren’t just authors. We are publishers! We pay for cover art and editing. We upload a finished product, ready to go. These aren’t royalties we’re earning; they are a cut of proceeds. So comparing our income as authors to other authors isn’t fair. We should compare our income as self-publishers to other publishers.

Okay, then, let’s compare. In this case, trad publishers are getting the better end of the stick for ebooks priced above $2.99. For ebooks priced below $2.99, self-published “publishers” begin to do better. (Very few trad pubbed books are priced this low, so it’s moot.) But we have to also compare everything, not just pay. We have to compare what Amazon is getting out of the bargain. Because the way I see it, indies aren’t just treated like second class citizens by Amazon — self-published authors treat Amazon’s customers like second class citizens.

What in the world do I mean? Well, I don’t see Harper Collins snagging Wikipedia articles and uploading them to Amazon for a quick buck. I don’t see the rampant piracy of other authors’ works, a quick repackaging, and again a quick and illegal buck. I don’t see publishers exchanging thoughts on how to make a quick buck packaging blog posts as KU ebooks, or how to chop up novels into thirty 10-page stories that pay out after the first page turn.

Are the offerings from indies and trad publishers the same? They certainly can be. The best-written indie books are as good if not better than the best-written trad published books. And the indie titles are usually priced more reasonably, which provides Amazon’s customers with a better shopping and reading experience. The best indie titles are well-edited, have great cover art and well-written blurbs. They provide an equal or better experience at often half the price. These are the authors who are justifiable in complaining about being treated as second class citizens. They hand Amazon great works at a steady clip, and they see themselves as being on par with a Hachette title, but the pay isn’t the same.

But we have to take the bad with the good. The same freedom to publish that has changed the lives of thousands of authors also brings a wild west where others take advantage and try to game every system in every way possible. A handful of rotten apples spoils the entire bunch. The only way to prevent this is heavy curation, which I certainly don’t want. I want freedom, but with freedom comes the need to curb abuses. The logical step (and many have argued for this, some with compassion, some out of spite) is a tiered system. Classes of treatment for publishers based on the class of treatment given to customers.

Before you balk, consider that we already have this. Amazon has varying levels of accessibility, from the practically wide-open KDP to the submission-curated Kindle Singles to the acquisitions editors at their imprints, to the work submitted by other publishers. At each level, the rewards (pay, promotion, editorial) vary. We don’t just have first and second class citizens. We have all sorts of classes.

The same is true with traditional publishers. Not all authors are treated the same. Massive advances effectively raise the royalty rate paid to top authors, who aren’t expected to earn out their million-plus-dollar deals. Some authors get book tours, others don’t. Some get top editorial, others don’t. Some get placement in the front of the catalog, others don’t. Some get store co-op and favorable placement in retail, others don’t.

The same is true of indies, who also fall into various categories. There are KDP authors, and then there are KDP Select authors. The latter get many promotional tools that the former doesn’t. KDP Select authors also receive higher pay in some territories than the regular KDP author.

There’s more. When Amazon started allowing self-published authors to set up pre-orders, they were concerned about the customer experience. What if the book isn’t ready in time? So they created a system that punishes those who miss their deadlines. You can have the right to set up a pre-order taken away from you for a year if you don’t get your work up in time. This makes perfect sense if you consider that Amazon’s philosophy for generating income is to concentrate manically on the customer experience. While Amazon loves authors, they love their customers more than anyone else. Again, more classes to fall into. It’s just the way the world works.

So you have a class of authors who make their deadlines and a class of authors on probation for not meeting their deadlines. You have a class of authors who get regular feedback from readers about typos and a class of authors who rarely get this feedback (or who act on it promptly when they do). You have authors whose ebooks are read in a few days and authors whose ebooks are read in a few weeks, a reflection, perhaps, on the quality of the customer experience but not on the quality of the work. And the customer experience, again, might be what Amazon is after. A quicker read means more purchases per year. I’m fairly certain that Amazon watches this metric. I would.

There are other tiers. You have authors whose ebooks average a certain number of sales, borrows, reviews, social media shares, etc. and authors who perform lower than this. Should we be treated the same?

I think we should have the same opportunities. The start line should be wide enough for everyone to slap an ASIN number on their chest and get ready for the bang of the gun. Everyone who wants to publish their original content should be allowed to, but I don’t think we have the right to expect the same outcomes. Even if your books are better than your neighbor’s, it doesn’t mean you’ll sell more. There’s an element of chance involved. It all comes down to public taste, the size of your platform, the timing, the genre, persistence, genre, keywords, hard work, and a hundred other little factors.

That’s where the classes start sorting themselves, and so the question is how Amazon should treat authors based on these outcomes. Should authors who sell a lot of books get better treatment than authors just starting out? Should an author with 30 published titles be treated the same as an author with 3 published titles? What about an author who releases a highly sought after ebook every month, as some of my kickass colleagues are capable of doing?

I think authors should be treated fairly, which means not evenly but commensurate with what they offer in return. And so authors who treat readers like second class citizens shouldn’t expect to be treated like first class publishers. That’s not an invitation to punish people (I’m sure many will read it that way). To me, it’s simply inspiration to work harder to treat readers with respect and to help other indies do the same.

Of course, it will be impossible to prevent abuses by the untoward and impossible to agree on metrics of quality (an exercise that I abhor). But now we can ask again whether Amazon should pay indies — as a whole — the same way they pay trad publishers. Should an indie author get the full tilt for a borrow in KU? Let’s ignore the fact that the system would likely collapse in a heap of unprofitability. Let’s also ignore the more reasonable idea that trad publishers shouldn’t get the same amount for a borrow as they do for a sale either. Ignoring all of that, do I think indies as a whole should get paid the same as trad publishers as a whole?

I do not.

As a whole, I don’t think we indies treat Amazon as well as trad publishers do (Hachette, notwithstanding). Not that it’s cut and dry. I mean, we don’t charge ridiculously high prices for our ebooks, which Amazon appreciates. But then, trad publishers don’t employ perma-free on the scale we do, and free ebooks tax Amazon’s infrastructure without earning them a penny (they lose money, in fact, as they have to pay AT&T to deliver these works, provide customer service for these works, storage, etc.). In all the arguments I’ve seen of Amazon treating indies as second class citizens, I’ve never once seen indie authors own up to the cost we foist on Amazon with perma-free. Not once.

That’s an intellectually bankrupt stance to take if it’s by simple omission. If people think that omission is justified, then it’s a morally bankrupt position. It’s a case of wanting as much from another as possible without thinking of what that party provides us or what costs we incur with our actions (again, as an entire group).

We have to consider indies as a whole, and so we unfortunately have to consider the number of hijinks, scams, rip-offs, pirated works, wiki articles, typo-ridden rough drafts, etc. that this group uploads to Amazon, all of which requires infrastructure to handle (fighting piracy and plagiarism isn’t cheap, nor is improving the customer experience through a focus on quality).

And here’s where life is unfair: There’s no way for indies to prevent other indies from spoiling the system for the rest of us. There’s no way we can help bring up quality overall so that we all get treated more fairly (though many try, whether by offering writing advice, sharing editing and beta-reading services, or providing tips on cover art, formatting, burbs, etc.).

What we need is something we already kinda have, and that’s reciprocity. The authors who respect Amazon’s customers by providing high quality reads with professional covers at a great price should be treated better than those who upload short error-riddled rough drafts at high prices. And the latter should be treated better than those who break Amazon’s TOS, like having KDP Select books available elsewhere. And this group should be treated better than those who break the law by uploading stolen material (or by profiting from open-source or crowd-sourced material).

Tiers. They already exist, but they are nebulous and unclear. When Amazon wanted to beta-test their pre-order system, they went to authors who had a history of producing quality content on a consistent basis. These authors were given special privileges in exchange for treating Amazon’s customers like first class citizens, all to test the merits of a system before wider release. The KU All Star bonuses are similar in that the authors who produce the highest-demand works are rewarded for doing so.

Not only will you and I disagree about whether or not this is fair, I don’t think most people agree about which of these decisions are fair and which aren’t. It isn’t that simple. It never is. If you’ve ever had a job, you’ve seen yourself and fellow employees treated variously in varying ways, and not all of it made sense. The question is whether or not Amazon has authors’ best intentions in mind when they make these decisions, and I am certain that they do. I think they consider their customer first (a fact many authors and publishers seem to ignore when trying to understand Amazon’s decisions), and then they look at their service providers (that’s us) and try to balance profitability with reasonability. I don’t envy them that challenge. I think they get far more right than wrong.

As an author, of course, I am biased. I think Amazon should tweak their KU payout system to make it more fair among us indies. 99 cent short stories and novels should pay the same 35 cents that they do on KDP. The payout should also come at higher than the 10% read range (maybe more like 50%). Works priced from $2.99 – $6.99 should pay $2.00 per borrow. And these rates should be known ahead of time. It shouldn’t fluctuate from month to month.

Another option would be to pay 40% on borrows and 70% on sales right across the board. But if we get more from Amazon, we need to ask what they are getting in return. I don’t see this mentioned much, but Amazon’s customers — our readers — are the ones who really matter. Are we treating them like first class citizens? You might be, but is our class of publisher as a whole?

If not, what can we do better? How can we negotiate with Amazon for better pay? I believe in fair exchanges; I believe we should take others’ perspectives to see what they need from us, not just what we need from them. As much as I hate the idea of tiers, they already exist. I would hate to see a “stamp of approval” system of any sort. The new release from a first-time author who put time and care into their product should be indistinguishable online from the latest novel from a Big 5 bestselling author. There shouldn’t be gatekeepers or curators within KDP.

So the fairest thing I can think of is escalators. Amazon’s self-publishing audio book program, ACX, used to employ earnings escalators. The payout rate might start at 40%, but it can go up to 90% with enough sales. This puts the job of rewarding customer experience where it belongs, and that’s with the customer. Keep them happy and coming back for more, and the payout goes up.

The question is whether or not Amazon is at its profitability limit right now with paying 70% of the sale price in exchange for hosting and supporting our titles. I think this is a fair split. It could be higher, but it could also be lower. Brick and mortar retailers keep 40% – 50% of the retail price in exchange for transacting the sale. Despite what some seem to think, e-commerce isn’t cheap. A 30% take in exchange for file hosting, delivery, recommendations, automated email blasts, marketing tools, the best customer review system, etc., seems fair to me. But I also think there’s a little meat on that bone. Especially to reward those who treat Amazon’s customers like first class citizens.

I’d love to see that 70% payout creep up to 85% with enough titles sold. Maybe 1,000 sales moves the peg up to 71%. 5,000 sales gets you 72%. Perhaps reaching 85% requires selling ten million ebooks (something no single self-published author has yet done on Amazon). I don’t dream of ever reaching that sort of level, but I would applaud those who do for being rewarded for it.

Maybe there are other ways to acknowledge authors who treat readers with the utmost respect. This would not only be reward authors but inspire us. It would be fair. What isn’t fair is what I see happening among my cohort: Authors expecting equal treatment without asking whether they are providing an equal service. Authors complaining about KU payouts when we cost Amazon a lot of money through perma-free (a practice we corner them into via their price-matching promise to their customers). We expect to be paid just like traditional publishers, but do we — as a whole — treat customers as well? Do our low prices offset any other deficiencies? Is there any way to expect fair treatment without dividing us up into tiers based on the quality and quantity of our output?

I don’t think these are simple questions, nor do I think the answers are obvious or simple. There are those who seem to think the answers are dead-easy, and that’s to give, give, give. I argue they aren’t thinking the whole thing through, or they aren’t trying to view the situation from all angles while taking everyone’s needs and motivations into account. I’ve certainly been guilty of this.

 


There’s been a bit of commentary on this blog post, which is already too long, so I thought I’d make it longer. The post wasn’t about KU being bad. I’ve blogged already that I think KU is great for many authors, that subscriptions are a disruptive force, and those who are disrupted are going to complain while the disruptors do well for themselves. I applaud that. KU has been good for me. I’m just looking at ways I would tweak the structure if I were Amazon. Not to benefit myself, but to provide the highest quality experience for their customers. (Any game of suggesting tweaks for a retailer must be taken from their perspective, otherwise it’s just wishful thinking.)

The post was also not an attempt to equate abuses of KDP with indies. Or to suggest that indies who do things the right way deserve anything less than stellar treatment from retailers. It was an attempt at a pragmatic view of the entire landscape, which I think helps explain business decisions that may seem wonky when viewed from within our immediate bubble, but might make sense when seen from a greater height or another perspective.

I’m not a fan of most of what is suggested in that blog post. My ideal publishing world would look much different from the current world. But how is that useful? If we are going to demand things from retailers like Amazon, we have to take their motives and needs into account. Motives such as: The customer comes first. Motives such as: We don’t want to give away products, but we also don’t want competitors to take market share by undercutting our prices.

I’ve seen it suggested that Amazon is all for perma-free, why else do they allow it? They allow it for the reasons stated in the previous paragraph, as a response to the actions of other retailers. If Amazon was truly for a free price-point, they would make this an option in the KDP dashboard. If they thought free should be easy to attain, they wouldn’t have limited us to 5 “Free Days” as part of our KDP Select membership. Think about that: The reward for exclusivity in 2011 was a mere 5 days of “free” out of every 90. That tells you what you need to know about how Amazon views free ebooks. Again, the fact that they price-match has to do with the fear of losing market share to competitors. We seize this as an opportunity.

When Hachette refused to negotiate with Amazon, Amazon responded by taking away pre-orders and predictive warehouse stocking. These were free features that Hachette and other publishers use to their great advantage without pausing to appreciate. Amazon pre-orders reshaped the publishing landscape. They are used to drive hype among sales staff, set print runs, and make all kinds of marketing decisions. I know, because I saw this in my publications with two of the largest publishers. They constantly updated me on how things were looking by referencing Amazon pre-orders. This was the sort of info that other companies might pay a lot of money to marketing firms or polling firms to deduce for them.

Predictive warehouse stock allowed same-day and two-day delivery of books to customers all over the country. When publishers ship books, it takes two weeks to get them (I know from working in a bookstore where I placed these orders all the time). If you go to a bookstore and place a “special order,” you’ll probably see that book in a couple weeks. That was the reality before Amazon spent billions of dollars on distribution centers and honed their predictive algorithms. Big publishers just take these things for granted. It made their negotiations with Amazon seem ludicrous to many observers. Why should Hachette expect these things, plus better margins, without offering anything in return? My blog post was simply raising the possibility that some of us fall prey to the same tendency to not see all that we are being offered — only what else we want. We fall prey to seeing how others treat us without delving into how our actions (as a group) affect others.

As I said in the original post, it is cosmically unfair for all KDP users to be lumped together. That’s the conundrum. I don’t see an easy answer to any of this, just more problems. But for me, thinking about it this way at least makes the issues observable so I can contemplate them better. I wish I could offer solutions or even hints of ideas for solutions. All I can offer is my own confusion and thoughts. For what that’s worth. :)

COMMENTS (114)

This is a kind of tortuous argument that in the end can be summarized as “yes, we are second-class citizens, but we deserve it because we make life hard for Amazon with our wacky and occasionally infuriating self-publishing antics.” Well… OK. Good know, I guess.

I prefer the way you put it. :D

I don’t really agree with it, though. We aren’t causing “problems” to make life difficult for Amazon, we’re trying to figure out how to get noticed in the goddamn ocean. That’s my *primary* concern. On a certain level I understand Amazon’s concerns (though to be honest it doesn’t really seem like they’re nearly as concerned about, for example, the wikipedia rippers as the rest of us are) but other than adhering to their TOS I don’t owe them anything extra. The TOS is *exactly* what I owe them. That’s why I don’t use KDP Select–because their TOS doesn’t allow me to use it, and I respect my agreement with them. But that’s as far as it goes, right?

I confess the way you seem to be *chastising* people for daring to be dissatisfied with the arrangement is a little off-putting. The fact that Amazon is right now the best chance most self-publishers have doesn’t make it perfect, and recognizing the parts that aren’t great and wondering what might be better is part of what makes a market grow, right? Amazon has shown that it isn’t content to rest on its laurels and be content with what it has. Why should we?

Not saying we should be content. But I don’t see much nuance in the discontentment. Indies act like Amazon should put them before the readers, which is crazy. And they also act like Amazon has unlimited resources and money, which is a little less crazy but still crazy.

I suppose it would help if you could specify who these indies are who want Amazon to put them ahead of their own customers. I’m really scratching my head trying to identify such people and what they are demanding.

The only complaints I’ve heard in this respect is that Indies would like to get the same deals that trad publishers get. And in some cases, Amazon agrees, and gives them things like pre-order buttons. I agree with you about the need for levels within the Indie publishing world, and that self-publishers should get rewarded for good behavior and sales. It would be good if they got deals similar to what publishers get past a certain level, so that there’s at least an even playing field to shoot for, even if they don’t get it right out of the gate.

And that’s not just a good policy for self-pubbers, it’s also a good policy for Amazon if it wants to attract mainstream authors away from trad publishers and get them enrolled in KDP. That would mean lower prices and faster availability all around, which would best of all for Amazon’s customers.

Very interesting read. Just yesterday I was wondering how authors get compensated from the Kindle Lending Library (the one included with Amazon Prime) , since actually that is how I got to know your Silo series (great books by the way!) .

Hugh, you have presented a fair and balanced view along with some common sense solutions. It is unfortunate that indies are viewed as a whole, though, since many of us do not participate in negative activities and yet are painted with the same brush as those who do. Some kind of alliance that would allow those of us who choose to treat our businesses in an appropriate manner a stronger voice with Amazon would be a wonderful thing.

good points in here. I absolutely believe it is much harder for a self pub writer out there.

Like it was mentioned, you have to shell out from your pocket for everything, from editing to a cover design. And to do it right doesn’t come cheap. And that’s where it gets murky.

Most indie authors don’t want to wait, don’t put the time and effort to put the best product out there and then they cry and whine how hard self publishing is.

Well, if you finish your NaNoWriMo draft, than slap a terrible cover on top and call it a book, don’t expect much.

Then again, there are plenty of great self indie writers, who have an excellent stories, but can’t reach a wide audience, because to promote a book on your own costs a lot of time and money, if you don’t come with an already pre-existing readership.

So I say that being an indie author is still much harder in sense of being noticed and recognized in the huge, wide sea of variety and junk, especially if you don’t have a big publishing house pushing you to the front.

Many sound points here. But there’s something wrong in your reasoning, Hugh: indie authors and Amazon are business partners. In a way, business partners have to reach an agreement that would be win-win. But Amazon isn’t the only publishing partner for us indies.

And other publishing partners treat authors better for ebooks priced at $0.99 (Apple) or for ebooks priced beyond $9.99 (Kobo).

Perhaps that those differences between retailers are a price to pay for the better discoverability opportunites that Amazon brings us. But the argument of the cost of perma-free for Amazon is for me difficult to swallow, as we can freely do perma-free with other retailers, and other retailers than Amazon don’t apply delivery charges. How it is that they are not already bankrupt? Or does Apple or Kobo use some kind of social dumping with authors?

Dig this post. I haven’t had much issue with KU as over payment on borrows of my .99 title mostly balance out underpayment on borrowers of my 4.99 titles. But I’ve been Amazon exclusive for my first year to keep things simple while I’m building readership and others’ tales of KU woes have convinced me to branch out to other book sellers in 2015.

As for leveling the playing field, I wish review scores followed an author rather than just a single book. So if you released crappy cash grab books, your overall Amazon rating would tank. Also, if you published a book that wasn’t so great, your overall rating would assure readers you don’t always suck, just this once:) This would encourage authors to always put out their best work.

Very well stated, Hugh. Well balanced.

The most important things I think Amazon could do to improve KU are
– to create a tiered system based on length of book, such as:
under 10K / under 50K / under 75K / 75K & up
– set a rate for each tier instead of using their wish-washy “KDP Select Global Fund”

Simple, logical, has my vote.

How does that help Amazon of the consumer?

There was a time when I would defend indie publishing tooth and nail. Now, as the KU bestseller list is filled with titles like “Alpha Billionaire Shifter Nails his Stepdaughter Book 3,” I realize the tsunami of crap has, indeed, risen to the top.

Now, with drag-down wars on message boards over the merits of editing (there are people who can afford it who actually argues AGAINST editing!!!!) every week, I’m having a harder and harder time trying to convince people indie publishing is capable of good writing.

KU: Where The Tsunami Of Crap Is King.

And that’s exactly the point that makes the whole thing so frustrating. Since when poorly written, un-edited versions of barely thought through books became the norm?

I am all for no editing required, if you have double major in English and literature. But most people nowadays ( and me included ) don’t come from US.

Me, for example. English is not even my third language and so proofreading, professional editing and constantly working on getting better, because I want to be taken seriously as a writer, is a must.

Those, who don’t give self publishing a bad name, making it harder for everyone else and making self publishing scary and intimidating platform to turn to.

How are good books hurt by bad books?

I don’t write alpha billionaire shifters, although some days I wish I did based on how well they are selling, but I am sick of the way romance and PNR is treated as a genre by those outside.

Readers are obviously buying / borrowing these books in droves for them to”rise to the top”. Think of it — of all the several million kindle books on tap, these books are rising to the top in their categories. To readers, they are the cream or else they would not be hitting the bestseller’s lists in their genres or in the Kindle store.

Period.

If you don’t like that, take it up with readers. Tell them they shouldn’t like billionaire shifter menages. Tell them what they should like.

It’s not the sign of the apocalypse but of readers being in the driver’s seat and choosing with their dollars and borrows what books they like — not critics or publishers or agents.

That has to be a good thing in the end. You know — if you believe in freedom of choice.

Peter, the readers have spoken. That’s what they want to read. What are you going to do? Take their books away and make them read *literature*?

To be fair, Amazon uses free through ACX as well. They hand out tons and tons of free codes to authors to get them to promote their audio books. They also kind of expect authors to pay for their bad business decisions on their end. They lowered royalties after shelling out tons of cash to get audio books produced and then messing with prices all over the place (most of my audio books have had three price changes since they were created and Whispersync just about kills and profits).

I’m not going to complain about KU though… even though it has hurt sales a little for me. It isn’t working for me on all of my books, so I pulled the books that weren’t benefiting (when their 90 days ended) and distributed them elsewhere. I don’t remember where you ultimately landed on this though, Hugh. Are you pulling your books from Select when their time is up?

that should say any profits… not and profits… :-P

I’m pulling some and leaving others. I don’t see any of these decisions as permanent or end-all be-alls. I prefer to try lots of things and just see what works, and to understand that what works now might not work in the future.

Of course price should be determined by price, apples to apples i say. If you sell a 5 dollar book and I sell a one dollar book, and they both get borrowed you should get five times more than i do. Who doesn’t think this is fair, and simple? It’s like with boats, I have a dingy, you have a yatch, should they be rented for the same price? of course not.

I was inclined to agree but the more I think about it, I like the notion of a more equal playing field for shorter works vs novels. Part of my reasoning is that I think many novels are too long, I believe in part, to support reaching the length to fit the qualification as “novel length”. Just this discussion supports that. You’re advocating paying more based on length and I, almost instinctively, agreed at first. But consider, your story could be much tighter at 35k words but if all of the commercial outlets favor the longer length baseline for a story, there’s pressure to fluff it up, add subplots, other characters, what have you, to hit some artificial length requirement. Even digitally, the idea that it’s easier to earn as a writer with novels than shorter works is still prevalent.

Besides, we’re not talking about a physical product either, it’s a story. I can buy a 12 minute live version of a song or the 4 minute studio version but I don’t pay 3 times as much for the longer one. I don’t pay a higher ticket price for a 3 hour movie than I do for a 90 minute one at the theater. In the Redbox kiosk here, there’s no sliding scale of price based on how long the material on the DVDs are. Everything is $1.25. Really, outside of print books, or other things where added length requires additional steep physical production costs, I can’t think of any entertainment where the length plays much, if any, factor in the price. I’m really starting to question whether or not fiction writing in digital markets should either, particularly in the context of something like a subscription service.

Really, outside of print books, or other things where added length requires additional steep physical production costs, I can’t think of any entertainment where the length plays much, if any, factor in the price.

Agree.

(Bold formatting added by me.)

I think it’s neither fair, nor simple.
I’ve bought great books for .99 cents. I’ve bought spectacularly crappy books for $5. In the particular example I’m thinking of, the 99cent one was a full-length novel while the $5 was a novella around 25k.

So length doesn’t determine price.
Quality doesn’t determine price.

What determines price on Amazon?
The author pushing the Publish button.

If you get 5 times more money than I do simply because you priced your book higher, guess how long that would last?
All of about 12 hours until the entire author pool realized they could simply print themselves more money by pricing their works more expensively.

So no, it’s not fair or simple – it’s ridiculous.

Let the readers and authors determine what price is comfortable for both of them.

^^^ (Speaking in terms of KU and its payout, of course – since that’s what the article is about.)

I am a READER. I want a quality read at a reasonable price. For me, KU has worked fine, but the pool of indie selections is beginning to look a lot more yellow these days. In order to avoid the pure junk, I find myself avoiding all but the best looking, best reviewed titles and that greatly reduces the chance I will find a hidden gem.

As a READER, I would love to see a system to help assure me that an author/book meets certain minimum quality control standards. Why isn’t there a “Indie Writers of North America” quality badge? Something to tell me that a writer is serious about his or her craft. Its not about how “good” a book is, but rather that the author has committed to making it a quality experience for the readers (typos, editing, cover art, etc).

Heck – make it easier. Set up the Hugh Howey Foundation with the sole purpose of advancing and improving independent literature. Authors pay dues to the foundation and after completing a rigorous course of study in self-publishing, they earn the title of “HHF Certified Author” and can post it proudly across every one of their books for 12 months. If they want to keep it, they agree to mentor an upcoming, new author just getting started.

Discoverability is still the toughest issue to sort out. I’m sure readers would love the kind of curation you’re talking about, but I can’t imagine how it would be fair for all authors. So hard to have anyone in control of curation other than readers, really. Which is a lot to ask of them.

I had a thought along the same lines. There should be a badge of quality of sorts to tell readers if the book meets some sort of standard. Like on eBay, that you know if the seller is legit.

What also would be great, if someone like Hugh, who already garnered a lot of fans and people who trust his word had a website were people could submit their self published work. If they meet necessary criteria in sense of quality of writing, cover, etc., they would be able to promote their work there.

I think that would be popular for indie writers who are serious in publishing quality books and for readers who are tired of trying to find good books in the midst of the bad ones.

Okay, you can download a sample and read the reviews other people have left. What more do you want? I don’t know how some “badge” would be any better. If you are worried about reading crap, check out the sample. How hard is that?

Stephen,

The free samples are often useful, BUT since Amazon includes the title page, etc., they often include a minimal amount of actual text.

And as others of noted, reviews are of limited usefulness, since many authors get friends and family to post positive reviews despite not having read the book and/or pay for reviews.

When I am browsing for new titles, the one thing that I find really annoying is that Amazon shows you the stars, but not a numerical rating, and the price, but not the number of pages. I don’t know how much time I’ve wasted clicking through on items in the $0-5 range only to discover that they are short stories/novellas/serials, not novels (which is what I am looking for).

@Matt

“The free samples are often useful, BUT since Amazon includes the title page, etc., they often include a minimal amount of actual text.”

Actually, Amazon is not the one who includes those things. The publisher does. An Amazon e-book sample includes approximately the first 10% of the book, whatever that is. The publisher, be it an indie or a traditional, is in charge of the design of the book. If that design includes pages and pages of copyright info and acknowledgements and an uninformative, space-wasting chapter list (Chapter 1, Chapter 2, Chapter 3,… Chapter 25), then the publisher is shooting himself in the foot with a much less useful sample.

There is no reason for a chapter list to be uninformative, nor, with an e-book, does it have to be in the front. The same for the author and publisher info. Save the space at the front of the book for the text of the book so your potential buyers get as big a sample as possible.

I start my books with “title page” which includes a single line copyright (to protect the sample), the “sales copy” because people like to download now and read later and that reminds them what the book is about, then right into “chapter 1”. Everything else including the big copyright notice is in the back. As a reader I hate paging through all that stuff too.

I agree. In addition to reviews and samples (not to mention checking out the author’s bio and other titles to see if they seem professional), there are tons of blogs and forums were people can get recommendations on books. The best “badge” would be to find a recommendation blog or forum in a genre you like.

“There should be a badge of quality of sorts to tell readers if the book meets some sort of standard”

Sounds great, but who’s in charge of deciding what standards are correct?

What Hugh mentions is mostly outright fraud, a crime. Amazon should put a stop to it themselves, if it matters to them. If enough readers get burned and complain, I’m sure they’ll do just that. If authors go after the fraudsters in court (perhaps a class action deal?), that could serve as a deterrent as well. I disagree with calling out indies as a group for the problem though, that’s kind of like blaming the hot dog vendor down the street because you got mugged in “their” bad neighborhood.

Anyway, back to your point — determining a certain standard is tricky. Who determines it? By what criteria? Reviews are already doing something along those lines, but the system can be abused and manipulated, just like any badge system that depended on group consensus. The fraudsters would find a way around it anyway, just like they manage to stack the deck with two hundred 5-star BS fake reviews to prop up their garbage now.

Wouldn’t it be more efficient to for consumers who want a quality indicator to simply limit purchases to established publishers? Let the publisher’s reputation be the badge of quality. It’s a huge market, and there are zillions of published books available. Everyone can find what they want.

I like the idea of a quality badge but would vote for Indie Writers of the World. One of the great things about e-books is the opportunity to discover books from places other than your own back door.

By the way, American Indies and readers are treated better by Amazon than those in the UK in a number of ways and I’m guessing it is even more of the case in other parts of the world.

So… I don’t deserve to be treated well by the company I’m paying a 30% cut from my hard work and also pay to point ads toward… while they do less than jack because I’m not selling enough to ‘deserve’ the basic tools every other channel gives me without any sort of chicanery?

Also, I’m on the same level as that dude that stole my book and tried to sell it on my own and that ALSO means I don’t deserve to do fair business?

Awesome.

I think KU works great. I would love to see more copyright enforcement, as you suggest, but I really don’t see a need for tiers or gatekeeping. Those sorts of restrictions probably would have kept even you from the amazing skyrocket to success that you enjoyed. Though the rules are different now, they’re great for a new crop of writers. I wish you the best on your journey and hope your new projects meet similar success.

Agreed, Meg. I’m a fan of KU as a reader, and I love that it helps many authors. Just suggesting tweaks. I posted about how we shouldn’t decry KU a few weeks ago:

http://www.hughhowey.com/everyone-is-in-the-middle/

Great post Hugh.

“Of course, it will be impossible… to agree on metrics of quality”

Here’s a quality metric we might be able to agree on: “good enough to read to the end.”

“The payout should also come at higher than the 10% read range (maybe more like 50%).”

Yes! Bump the initial payout to the 50% mark and then give another payout if the reader “finishes” the book. (Set it at 95% to account for readers that skip the afterward and appendices.)

“Discoverability is still the toughest issue to sort out.”

Amazon should tweak the algorithm to give a ranking boost to books (purchased or borrowed) when they are “finished” by readers. This would bump those books up in the charts, making them easier for new readers to discover them.

Couple this with a payout adjustment based on the length of the book, or at least the list price, and all problems are solved, right? ;)

What do you think?

The success of self-publishing is mainly due to its ability to target the voracious reader with low-priced books. This is something the trade publishers could not do effectively due to limited shelf-space. Along comes ebooks, unlimited shelfspace, and the internet and suddenly this was possible. Authors were grateful and backed the company that gave them this ability. Voracious readers rejoiced as they could now reach the masses and bypass the gatekeepers.

Now we have KU. The ability to reach the voracious reader is still there, but now the price/profit is next to nothing. Furthermore that price/profit is ever changing and completely out of the hands of the author/publisher. On top of that the author is required to commit to a single platform. Yes, it’s one that has treated them well in the past, but that doesn’t mean the deal they offer now is a fair one.

Simply put Amazon is about winning, be it market content, customers, or market share. Self-published authors have now reached a point where we are between Amazon and winning. The only way to escape this is to be strong on other platforms. KU, by its nature, prevents this.

Sorry Hugh, I can’t agree with you on this one. I don’t see any of your changes that couldn’t be gamed just as much as they are gamed now. I think we’ll see some numbers soon that show just how much KU is FUNDAMENTALLY flawed. For BOTH the reader and the writer (and even Amazon itself). I expect version 2 to raise its head very soon with several changes. Will it be uglier or cuter? We’ll just have to wait and see.

As a reader, and wanna be writer, I disagree with your assessment of why self-publishing has become so popular. Trade publishers dropped the ball, not because they were limited by shelf space, but because they had become bloated badly managed bureaucracies that stopped serving customers properly.

Successful self-publishers have emerged because they write books that people want to read that the big trades failed to publish. Writers are flocking to self-publishing because it’s a better option than dealing with bloated badly managed bureaucracies. Readers are buying self-published books because they have value. And not just low prices.

There was absolutely nothing stopping the trade publishers from leaping into and dominating the ebook market and killing the self-publishing baby. There are a ton of ways they could have done this, either by setting up their own ebook distribution systems or working with, rather than fighting Amazon. They have more than enough resources to suck up all the best writers, and to fill all the distribution channels with quality books in every genre (and price) and shut out most self-publishers with better marketing. They could still do it today. (And maybe eventually they will.)

They didn’t because, frankly, it’s too much work. They would rather print less books and charge more for them, even if that meant readership declined. And they refused to give up their efforts to promote unprofitable literary fiction, to promote literary darlings, to use trade publishing to reward nepotism and buy political influence. The books that they paid to put in the front of the stores were not there because they were what readers wanted, but because publishers had a variety of reasons, often simply ego, often influence peddling, to promote them. Readers be damned. They preferred to churn books rather than nurture back catalogues of the best works. All the while, they treated genre writers, who brought in all the real profits, as true second class citizens in terms of pay, status and attention.

This is why self-publishers are dominating genre (i.e. books people want to read). Because trade publishers gave them an huge opening. Big publishers could easily turn this around, but it would require treating writers a lot better than they are used to, and favoring the best writers, rather than the fellows who went to the same schools executives attended to. It would mean putting writers, rather than executives in first position. And cutting out bureaucratic waste and overhead. That isn’t likely to happen.

So, most likely the big trads will continue to get rich off their backlists, slowly cut back on vanity deals with marginal talents, pay millions of dollars in advances to buy a few best sellers, while they continue to enjoy their perks as they slowly fade into cultural irrelevance.

Dude, you’re smothering us. What a lot of words, Hugh! Bottom line: Amazon is a business. In this email, it states:

“To further highlight the KDP Select books that are most popular with customers, we will again award “KDP Select All-Stars” for November to the most-read authors and titles in the U.S., U.K. and Germany. We’ll spotlight each All-Star author and title on applicable detail pages. These awards will come with financial bonuses and recipients will be contacted in the next few days. Anyone with a title in KDP Select—even a debut author with a single title—can qualify if their work becomes a customer favorite.”

EVEN a debut author with a single title: eight words that speak volumes. If an indie author works hard to generate sales, Amazon will help to generate even more sales. Not because of merit; the book can be the worst book ever written, but if it gains traction, Amazon will back it. That’s business; that’s the way businesses work.

As for different authors/publishers being treated differently: why should they be treated the same when it works better for the customer-centric business that Amazon is to treat them differently? If self-published authors don’t like the deal, no one forces them to signup to KDP or KDP Select/KU.

I’m just kind of… weary of it all. I just follow the rules and do my best, and if Amazon tells me they’re going to pay me less, I just sigh and nod, because I’m too new to do much about that. There are assholes in every industry, I’m sure. (And, you know, I doubt Amazon loves Hachette after all that terrible publicity.)

Amazon also doesn’t care about me. Seriously. They gave us a place to publish and reach readers, and we helped them establish their Kindles with our cheap and free content. We helped them own the ebook market, and some of us made / are making a living. That’s as far as the symbiotic relationship goes. I was never under the impression they were anything more than a retailer where I could sell my stuff.

I’ve been in this less than a year, and it seems like people are pretty stressed out about where things are going… they say it’s really hard to break out now. Sometimes I just want to shut off the internet, write the rest of my series, never check the sales or publishing news, and only come back on here when I need to upload a new book. But I can’t. I have editors, cover artists, readers and other responsibilities.

You know what would be helpful? If Amazon gave us actual data about our books. How well do my product pages convert? How long do people have my books before they read them? How long does it take them to get to the end of a book? Is there a point where readers stop reading, a place where I lose them? I could actually do something with that kind of data to improve the customer experience. If I have no data, I’m just throwing spaghetti at the wall. I don’t think Amazon is really worried about it. There’s enough of us throwing spaghetti that some of it is bound to stick. When it does, Amazon promotes the hell out of it.

I love these ideas about the data, Autumn: it would be so useful. At first glance I thought it seemed it would be impossibly expensive to provide but maybe the Amazon bots could do it in a breeze.

Hugh, I haven’t yet been around long enough to know how much I disagree or agree with what you’re saying–so sorry for that.

But I have been around long enough to get a sense of the Indie group as a whole and it’s a great group made even greater by your membership.

Please keep speaking your mind.

ETA: I had back surgery today. Your earlier post from today is, as they say, a day late and a dollar short.

Smart Debut Author

Respectfully disagree. :)

Indies are independent publishers by definition. We aren’t affiliated with each other. There’s no reason for us to cheerfully accept a double standard simply because of the problematic practices or products of some other independent publishers. Should Penguin Random House, who happens to be a traditional publisher, have had their preorders and discounts taken away simply because a different traditional publisher Hachette refused to negotiate a new contract with Amazon?

I could draw even uglier analogies to whether “classes” of individual should do the same job for a different pay scale or accept poorer treatment simply because of what some of their “peers” do… but I won’t.

And Amazon’s not doing anyone a favor by hosting perma-free content. If it didn’t make business sense for them, they wouldn’t. Permafree sells Kindles. And those Kindle owners then buy other books. And sign up for Prime. And KU. And buy TVs. And diapers. ;)

If Amazon was 100% dedicated to putting the customer first, they would get rid of co-op and level the playing field for content producers — traditional or indie — and let each product rise and fall on its own merits.

Amazon’s a business. It appears KU is costing them some indie goodwill. It may make business sense for them to accept that. Or it may not. We’ll see how it plays out.

And Amazon’s not doing anyone a favor by hosting perma-free content. If it didn’t make business sense for them, they wouldn’t. Permafree sells Kindles. And those Kindle owners then buy other books. And sign up for Prime. And KU. And buy TVs. And diapers. ;)
***
Yup, it’s a loss-leader for both indies AND Amazon.

Amazon is pretty quick to slam anyone who prices a book at, say, $7.99 on Amazon and $4.99 on iTunes, Kobo, B&N, etc. The author/publisher gets a stern email demanding that the price inequality get fixed ASAP. Or else. I suspect Amazon could be equally draconian about perma free, if Amazon so wished.

The idea behind perma free is that the author/publisher makes more money overall. If the author publisher is making more money overall, then Amazon is also making more money overall. Which means perma free isn’t a burden. Just sayin’.

Hugh, very informative article, thanks. I appreciate the time and effort you put into all your articles regarding trad pub vs. indie author/pubs. I agree that we do not want gatekeepers from the indie side because one, quality can be subjective (excepting mechanics), and two, it then becomes pretty much like going thru an agent/trad pub, which would defeat the purpose.

But forgive me when I ask, but what exactly does it mean when indie authors treat customers like a second-class citizen? Is this the paid for inflated reviews, and the short content with tons of errors? That sort of thing? I agree that most indie authors want to do the right thing by the customer, the distributor, and themselves. Plus, no matter the product, there will always be a few bad apples who game and ruin. You’re article has caused me to seriously reconsider anteing up for a real edit of my first book. I’ve already ponied up for a decent ebook cover so why not an edit? The question then becomes, whom to solicit that I can trust?

Another thought occurred to me while reading your article. You spoke of gatekeepers. Suppose for a moment a sort of indie author co-op was set up or organized by some enterprising learned human to help freshmen authors with a first book. A kind of pay 200 before you pass go. What top 5 litmus tests might be useful? Level 1 could be grammar and mechanics. Level 2 might be story line and plot, does it jive. Level 3 could be character development. Plus levels 4 and 5 with the more advanced stuff, and not to forget the package–formatting, cover, title page, toc, acknowledgments, about the author, etc.

Perhaps this indie author co-op could comprise a large group of indie authors (or agents and publishers for that matter) who each provide various levels of feed back for a low set price. For example, I’ve noticed that I need only read a chapter or two to get a feel for who a person writes. Use grammar in this case. One can see in the first several pages whether grammar needs work or not. The point is, if grammar needs work in the first few pages, then it’s likely the grammar needs work on all the pages. So a reviewer need not read the entire manuscript. Or, maybe an indie author submits only one chapter at a time for feedback in one or more of the levels listed above. Yes, this would server as a sort of gatekeeper and an attempt to up the quality for those indie authors who genuinely care about treating themselves, the distributor, and the customer like first class citizens. I don’t know, maybe too complex. Perhaps susceptible to ballooning into a large headache. Just a thought. TomS

Insightful as always, Hugh. I just keep trying to paddle the boat downstream, avoiding the rapids where I can and hanging on for dear life where I can’t. My thought is that whatever I do, if it’s contrary to the mighty Zon’s business plan, then I’m the one doing it wrong and I trim the sails and follow their lead.

My response when this came up in July was to argue that if indie authors wanted a better deal then they needed to form a larger economic unit: a union, coop,bunsiness, etc. That would give them more negotiating power.

This has been brought up. I think it would work if the top 100 or so indies were all onboard. Not sure how you’d herd that many cats, though. The problem is that there will always be thousands of indies who will work for less just to get a chance at exposure. And I wouldn’t blame them or begrudge them for doing so.

By becoming a publisher in all but name.

I do have a novel and novella perma-free at Amazon, but since making them so, I’ve sold FAR more of the other books in the series than I did pricing them even as low as 99c. When Amazon stopped price-matching to free, I emailed KDP to ask them to please price-match, as we sell more books and make more money that way. They must’ve checked on their end, because they responded with an “all righty then!”

In cases like mine, perma-free isn’t taxing on Amazon. It’s a mutually beneficial marketing strategy.

To suggest that “indies” are treating customers as second-class citizens by uploading ripped-off works or gaming the system with ten-page “books” is to paint all indies with one broad brush. Scammers =/= indies.

KC

I employ perma-free as well. I’m not urging indies not to use perma-free, only pointing out that we are using Amazon’s price-matching philosophy in a way that it was never intended to be used. This is a benefit that we just expect to get from them for free, just like Hachette expected to get predictive warehouse stock and pre-order data for free. We made fun of Hachette for taking those things for granted, and yet indies do the same thing. And then complain about how much Amazon pays them and does for them.

Maybe we should — along with demanding better pay — think about all that we have and what Amazon and its customers hope to get from us as well. That’s all.

This is not directly tied to what you’re saying, but I think it’s worth noting:

Many of the issues that have sprung up around KU have to do with a fundamental problem that afflict all subscription models, whether it’s KU, Netflix or Spotify: the retailer does not know the value of the borrow. I’m using the term “value” here the way economists define it: a consumer’s willingness-to-pay. Not artistic merit or number of pages or anything else. Just the amount of money the consumer is willing to give up to read the book or watch the movie or listen to the song.

In the typical marketplace, you can price (and reward) higher-value works higher. With the subscription model, the retailer is forced to guess at the value of each work. That’s impossible. KU’s current strategy is to say a book is a book is a book. That’s clearly inaccurate. It penalizes high-value books, and encourages gaming as to what constitutes a book. Page-counts is not the answer either because there are plenty of high-value short books. There simply is no good solution.

The main advantage of subscription models is frictionless browsing and searching which allows you to find stuff you like much more easily. I think a pay-per-view system paired with generous free previews to improve discoverability offers the best of both worlds. I think Amazon should allow 50% previews–you have to pay only if you want the last half. Better yet, allow authors/publishers to set the preview level. I know I would bump my free preview to at least 50%. (In fact, I think perma-free is being used as a way to offer a larger preview than formally allowed by Amazon. From that perspective, perma-free is not bad for Amazon. It’s a tool to help people discover books that will pay for.)

I agree with your points and it made me wonder if there was a way for us to self-police?

We indie authors spend a lot of time looking at rankings and the books we compete with on a daily basis. I know I see books that are scams to earn the KU royalty by being so short they can’t help but make it to 10%.

If there was a method for reporting the suspicious books I’d gladly let Amazon know about the bad apples.

One might argue that the system could be abused, but like the pre-order, if an author was found trying to eliminate competition their privileges to report could be revoked or suspended.

It’s just a though.

Great post.

Hugh is utterly and completely wrong about this. There are no classes, no citizenship, and no unequal treatment. Accepting this frame of reference for discussing KU leads to stupidity and confusion. Don’t take ownership for others’ fraud. Don’t assume you are entitled to respect. The only thing you are entitled to is what is in your contract.

People keep saying that traditionally published authors are paid better than indies in KU. That is utter bullshit. You want to know much 99+% of traditionally published authors get from KU? Nothing. Zilch. Zip. Nada. Because their ebooks aren’t in KU. There are a tiny number of traditionally published books in KU that are used as loss leaders to attract customers to the service. Indies in KU should be thrilled that Amazon is willing to subsidize these ebooks because they will attract customers to the service.

KU won’t be a good thing for most indies with an established fan base. But that has nothing to do with Amazon taking a loss on a handful of ebooks like “The Hunger Games”. It has everything to do with the dynamics of KU. The smart thing to do is to look at what Amazon is rewarding in KU and do that if you decide to play the KU game. If you have 99 cent ebooks, put them in KU. If you have short stories, put them in KU. Start a new pen name in different genre and put those books on KU. Want to release an ebook with lots of illustrations or photographs? Put it in KU.

Just don’t do any of the stuff that Hugh suggests. That’s all a waste of time.

Strange. I agree with all of this. :D

This. William’s suggestions are exactly where my thoughts on KU have been lately.

I don’t feel like a second-class citizen. And I accept that nothing is fair in the publishing world. It’s just the way things are and not necessarily a bad thing. I’m a (fledgling) businessperson and author who wants to write the books she wants to write and sell them and get a fan base so I can write more books. KU is one method to explore (as is trad pub, had to say that) and see where it can be used to my benefit. It’s not either bad or good. It just is. Another tool. It won’t work for me for the books I have out which are series so if I want to help my series by using KU I have to find a way to use it to draw people to my series – novella, shorts stories, etc. Or as William suggested – new book, new genre.

Agree. If you can’t play the game, then don’t. Those who can will.

Hugh, you’re absolutely right.

Writers are looking at KU the wrong way, as though it’s the classic zero sum game. Someone purchases a title through KU and the writer gets paid $1.30 instead of $2 or $3, so they feel ripped off.

But they’re not seeing the bigger picture of what Amazon is trying to accomplish. Amazon is seeking to expand the pool of readers, to lower the barrier to entry and make it as easier for people to read a large diversity of books without feeling like they’re making a huge financial commitment each time they select a title. As authors, we should support a system that is as simple, easy and enticing as playing Candy Crush or streaming the next episode of Walking Dead. We want people to pause and think about what they do with their spare time and choose to read.

Readers make the world a better place. For me, the success of Amazon is found in sitting on a bus and seeing someone reading a book instead of playing tap zoo on their ipad.

I look at KU sales as Candy Crush converts :)

I’ve blogged in the past about how free days under KDP Select were considered golden. Now we get paid to gain eyeballs, and everyone is atwitter. Someone explain that to me.

“I’ve never once seen indie authors own up to the cost we foist on Amazon with perma-free. Not once.”

C’mon Hugh, you know that data is virtually free. We pay X per text message when it really costs almost zero and Y per kilobyte with Amazon but it’s wildly overpriced. It’s not zero cost for them but it’s so close it may as well be.

My webhost gives me 50 gigabyte per month for $16.95. That’s 50,000,000 kilobytes. A 500kb file can be sent 100,000 times using a personal webhost. That’s 100,000 eBooks served up for $16.95.

That’s $0.0001695 per freebie.

And that’s at retail overpriced rates. Amazon own massive server farms. Their cost per freebie is … zero. Or 0.00000000000000000000000000000000000001695.

If you think it’s just a matter of data storage, I can understand your confusion.

Amazon has to pay for Whispersync delivery. Some freebies are massive, size-wise. Plus there’s file checking, customer service and support, and loads more.

She’s talking about bandwidth 50GB for less than $20 retail. The storage is even more ridiculously inexpensive. It would take a ridiculous quantity of whispersync-ing (60 full downloads) to add up to a single penny of bandwidth (according to the above assumption) for a single title to a single reader.

Emily is not considering that she isn’t paying for 50GB of bandwidth, but what the typical customer at her hosting service uses, which is probably nowhere near 50GB. However, one one hundredth of a penny for a typical book download is probably somewhere near Amazon’s cost. The delivery cost Amazon takes off the top probably takes into consideration a worst case scenario of eternal hosting and hundreds or thousands of downloads over the course of a human lifespan. Then there is the cost of getting the sale in the first place. My guess is that orders of magnitude more bandwidth go to customer (and author) browsing than customer downloading.

That was a big mess of who knows what, but my intuition is that Amazon’s delivery charge (which I assume is the foundation for your concern about Amazon’s cost) is intentionally high to ward off unknown future behavior that will be costly to them. It isn’t appropriate to think of or present it as an actual cost of delivery for free ebooks. Mentioning the few outlier books with numerous images as representative of Amazon’s expense is not reasonable either. Emily’s 500KB books might be a bit low, but 1-2MB books aren’t going to change the economics a whole lot.

As far as my wife’s and my books go, we’re probably costing Amazon far more from the customer services associated with periodic changes in pricing, covers, blurbs and prods for price matching than from bandwidth for thousands of free 1MB books. That’s only a guess though.

Thank you for this post. Being new to the whole self pub / indie thing, and having not published yet (still in the process)…this provided a great perspective. I’ve been seeing some of that talk on the KBoards lately and wasn’t sure what to think of it all. This really helped and I honestly hadn’t thought of the cost incurred by Amazon with such things.

Also, it challenges someone like myself, who is in the process of finishing my first book. Ha…on my 3rd re-write. I do want a great experience for our readers. There really is a temptation to skip some of the “professional services” (artwork / editing) but I’m more and more convinced that (and it’s turning into a solid conviction) I need to spend the $$$ and get the proper editing, artwork and etc. so that if even one person reads my book, they’ll enjoy it.

Life really is not a fair deal. Whatever venture we involve ourselves in. Not to sound pessimistic. I fully expect to start at the bottom, do the best I can, give our readers the best and move up from there given the opportunity.
Thanks again for your insight!

I AM my own publisher. That’s why I’m called self-PUBLISHED. And I’m getting treated like crap. Quit moving goalposts and licking Amazon’s boots. You’re their useful idiot–emphasis on the latter.

I pointed this out in my post. We are publishers.

And why so rude? We should be able to disagree and calmly discuss these things.

Regarding discoverability, I think it would be cool if a customer had the option to buy the book a few cents cheaper if they promised to leave a review, after say, a month. If they did, the indie author would make a little less, and amazon would earn a little more if the reader followed through. This would only last up until a certain number of reviews had been completed. As a soon to be indie ‘debut’ author who has paid for editing, this appeals to me because it could help get me out of the new author indie ocean. As for those who slapped a rough draft together and put on a crappy cover, it might be a death knell, LOL.

Oh! I forgot to add, the reader would recieve their discount after they left a review and it would be put toward their next Amazon purchase ;)

Lots of great thoughts and insights. It all reminds me of the Winston Churchill quote, “democracy is the worst form of gov­ern­ment, except for all the oth­ers.” Amazon is terrible, except it’s better than all the others. Yes, Apple and Kobo offer better terms in some areas, but they don’t reach as many customers. There are always going to be tradeoffs, and as you point out, Amazon thinks of customers first, then self-publishers. That’s why they have the biggest market. It would be nice to have a benevolent dictatorship that makes the same choices we want, but since that isn’t possible, it’s sure great have a customer savvy business that gives us a ton of tools to reach buyers. And that’s what KU is, another tool for writers. Use it or don’t use it. That’s your choice.

I read this and despair. I have never treated Amazon customers like second class citizens. I have always made quality product and never tried to game the system. The people you refer to here are not “authors.” They are charlatans, trying to make a quick buck. No one I know would do this kind of thing. But it all reflects on the legitimate people so poorly, it’s a wonder most of us can even do business :(

Hugh,

Us Authors should be treated like second hand citizens by Amazon. Since it’s so easy for anyone to publish their own work, why should Amazon treat us like 1st class? They already pay us and offer incentives for 1st place if using KU. As for KU payouts, they should also consider how any pages the book has rather than just price to be fair.
I do think that well established indie authors such as yourself should be offered a little more incentive by Amazon, not sure what kinds other than money, but Amazon should start classifying each author based on earning and open up incentives as they progress Just a thought.

I wanted to add that I haven’t read your books, but I hope to see the movies if ever. I love the idea of your books, but I just don’t have time to read, I’m too busy writing my own stuff.

Having been in and out of Internet marketing from the beginning I have seen many cycles of what I call “Stupid Internet Tricks”- things such as chopping up books and using Wikipedia content. They do work. Sometimes extremely well, but only for a short time. The system ALWAYS catches up with you. It is in no one’s interest to let crap profit.

The only thing that has staying power is a quality product that connects directly to an audience. Neither Amazon nor Google owes you a living. Take what they give you, but don’t expect it to last. If your business plan relies on any platform other than your own, you will be displaced. That is the truth. How to deal with it is up to you.

Afraid I disagree with some of the logic. First, Amazon is a commercial entity that is simply doing what its competitors are doing. So indies aren’t burdening Zon with an abuse of price matching any more than Apple is burdened with it, or B&N is burdened with it. Reality is that both those companies offer the ability to put your book for free, bearing the costs of doing so as part of their business. Amazon does not offer that ability, but matches those that do. Amazon also charges a download fee over and above its 30% slice of books over $2.99, which its competitors do not, reducing the effective royalty from 70% to something less. I’d also point out that Apple is the one that set the 70% – Amazon was only paying 35% until Apple introduced 70%. So if we look at history, Amazon reacts to its competitors (as it does with price matching, and with its royalty structure). The cost of reacting to competitors is not the burden of its vendors. It’s the burden of the company – the cost of doing business. It doesn’t have to price match free if it doesn’t want to, but it does. So it must be worth it.

As to whether indie publishers are treated differently than big trad pubs, of course we are. It’s Amazon’s sandbox and they can treat us as differently as they like. I have no problem with that. If it wants to treat indies like rubes, and make them guess what they’ll be paid each month for participating in its exclusivity-required program rather than telling them in advance, and indies are willing to put up with that and keep their books in? Fine. let em. Trad pubs are too businesslike to fall for that, so they require different rules or they simply won’t participate. They also won’t take fractions per sale for a borrow – they get paid full royalty for each borrow in KU. Just as Oyster and Scribd pay nearly full royalty to everyone, including indies. Now, Amazon, it its wisdom, decided it didn’t need to compete with Oyster and pay, say, 65%, regardless of who the publisher was – that’s a business decision. When indies accept egregious terms, out of desperation, or stupidity, or simple lack of awareness, that’s the indies’ fault, not the company offering the deal’s fault. If Amazon feels that indies don’t deserve the same royalty as a trad pub, or the same treatment, it’s Amazon’s prerogative to do so. Just as it’s my prerogative whether to accept it or not.

If an indie has analyzed KU and determined that it makes financial sense to them, super. But complaining about it, as I’ve seen a lot of, achieves nothing. Nobody likes a whiner. I think we can agree on that.

Peace, and happy holidays.

Good article with valid points.

Perhaps a telling underline to many of these points was in an email I received a few weeks back. A reader wrote to me, explaining how delightfully surprised she was with one of my books as “…most titles they offer in KU have you rolling your eyes and deleting less than halfway in.”

Reminds me of that Married With Children episode where it was movie night, and Al wanted Schwarzenegger, or Stallone, or Eastwood, and then Peggy and the kids mope on in with Oh Heavenly Dog…the best title they could find in Betamax.

I just read every comment to this post.
I’ve been in the Indie Publishing game since it started – even BK (Before Kindle)
I earned a full-time living for almost 3 years formatting eBooks and Print books and Book Covers for other authors. I have seen a lot of strategies tried, but few that worked in any meaningful way. Things I didn’t think would work often did.
But I could always tell a determined and capable Indie author from those getting their first title out. It’s a business, but it’s truly many thousands of businesses, where what works for one does not always work for another because of the variables involved.
I want to make note of what Autumn said in her comment – about what kind of data Amazon has that would be so beneficial to authors. Like how many times a book page was visited, and how many were converted to sales. And what percentage of readers finish the book, or even start it after a free download. I’m guessing Trad Publishers can get that data.
I had a title on perma-free for a year, giving away nearly 100K copies. After 3 years, that title has only 39 reviews – with a 4.2 star average. So how many of my free books were actually read?
The garbage being published will be found out eventually and die a slow death. I would rather have readers being the gatekeepers than any other group. I have to believe that extraordinary books will do extremely well over time, and good books will prosper at the hands of the readers. The rest is up to Indie Authors and how well they conduct business.

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Question: What about the publishers which also use KDP? Do indie authors get a worse deal than that group? How much worse?

I believe they get the same deal, as per the KDP terms.

That’s what I thought, but I wanted to make sure.

In my mind that undercuts the whole “indies are getting a worse deal” meme. Indie authors have the same access as the smallest publishers, just as they should.

Now, if you want to agitate for better treatment, that is a different matter. It’s also an entirely different debate than discussing whether indies are treated as second class citizens.

The moment I think my relationship with amazon isn’t vaguely adversarial, I’ve lost my ability to make the best decision for my books.
I am in the retail business, but I am not Amazon, therefore, we’re not on the same team. Some of our goals my intersect, but very little if at all. Amazon wants the same thing every other corporations wants (and I’m fine with that), but I don’t confuse baiting the trap (KU) with Christmas dinner.
It is incumbent upon me alone to produce great work. It’s Amazon’s job to maximize their profit from such work, and therein stands the balancing act that Indies must recognize and navigate if we want to be successful.

Oh, my typos. Seriously, Terry.

We are constantly saying that consumers can vote with their dollars. Well, this concept works on the other side of things as well. If Amazon ever does anything that is grossly disadvantageous to independent writers, then independent writers can just walk away with their business and take it somewhere else.

So many people get lost in the romantic notion of writing a book that they forget about the nitty-gritty—particularly that this is a business. If you want people to give you money in exchange for something you created, then you are running a business. That is the Business of Writing.

I try to pound this into the head of everyone who says they want to write a book. It is very easy to self-publish now, but there is so much more to it than simply writing your manuscript and uploading it five minutes after you type “The End.”

What I’m seeing happening among a bunch of independent writers concerning the Kindle Unlimited Library is they are pushing up genre-jumping and experimental pieces using pseudonyms to see what happens. Yes, I concede this can also result in a lot of garbage. But it can also result in a lot of brilliant, short story writing and create some real gems of fiction. It may also improve the writing skills of many of these authors as this exercise forces them to see what works and what doesn’t.

I think what every legit indie published writer wants to know is how to make the best use of KDP in whatever iteration exists at a given moment. The answer, of course, will be different for each of us, but nobody knows our titles better than Amazon itself. I’ve written to them suggesting that they offer a paid consulting service called Amazon Max, as in how to maximize your revenue within the existing set-up of the moment. What do you think of that?

I love the idea. The more money you make, the more they make.

Exactly. As you’re more likely to have Amazon’s ear than I am, please feel free to mention this idea to them whenever you get the chance.

I note without surprise that as a purveyor of especially successful mass-market fiction you believe that the enhanced economic benefits should all be reserved for purveyors of especially successful mass-market fiction. We should by all means exclude writers of serious nonfiction — why would the world need facts when fantasies are so much more fun?

The serious nonfiction is rewarded based on sales. Just like every other book.

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Hugh,

Small point: I think perma-free is a net benefit to Amazon. It’s a net benefit to lots of authors’ sales, so how could it not be a benefit to Amazon too? I doubt the delivery costs of free books overshadows the profit of sell-through.

On KU: right now, the structure of KU encourages people to chop their book into chapters and upload them individually. It’s bad for the reader, it’s bad for Amazon, and it’s probably bad for the author, but that short-term candy is hard to refuse when you’re trying to make ends meet. Agreed that KU needs more structure in the form of more rules. The low, flat reimbursement per borrow is too open to abuse. And the fluctuating payout has inched ever downward, I’ve noticed. This will kill the program by itself as we all opt out.

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As always, Hugh, you make us look deeply into what we do and how we can improve things. This is a really thought-provoking post which deserves attention and thought throughout the forthcoming year.

Thanks and Merry Christmas.

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