Yes, once more Amazon is “screwing” authors: Set to pay them .006 per page

4 July 2015

From author Bob Mayer:

The amount of misinformation and disingenuous commentary on the Internet is exceeded only by the self-interest.

A group of authors who write shorter works are claiming they’re being discriminated against because Amazon has shifted payment in Kindle Unlimited from titles borrowed to pages read. Imagine? I don’t seem to recall a single one of those authors crying out about getting paid the same amount for a fifty-page book as the author who has published a four hundred page book. If I missed your blog about this, please let me know in the comments section.

And apparently, according to this article in theGuardian, the authors who wrote these shorter works are: “A lot of self-published romance authors are disabled, stay-at-home mums, or even a few returned veterans who work in the field because a regular job just isn’t something they can handle,” she says. “People are shedding a lot of tears over this.”

So writing is not a regular job? (And don’t get Jen going on the ‘stay at home mum’ thing.) I have no doubt that quite a few authors relying on this have issues. And that the change is hurting many. But last I checked Amazon, and almost every other company I can think of, isn’t in the business of developing their business model to do anything other than succeed. And for those who think I’m an Amazon apologist, please read my other blogs. I always recommend anyone doing business, even as a customer, with Amazon, read The Everything Store. My takeaway from that was that Amazon’s founder, Jeff Bezos isn’t in it to make a lot of money; he’s in it to win. And that indeed is dangerous to any who do business with Amazon. But that’s the reality.

. . . .

In Special Forces we were taught winning was everything, so I understand that mindset to an extent. Because losing in that line of work had far deeper repercussions.

Here’s more reality: Kindle Unlimited is voluntary. Let’s accept one fact: a lot of people jumped on board with this because they were gaming the system. Knocking out a lot of short works to gain an inordinate payment under the old system.

But overall, authors who wrote full length novels were actually getting screwed. If I’d wanted to game the system, I should have focused on writing five 20,000 words stories (earning $6.60 if all are borrowed) rather than one 100,000 page book (earning only $1.32 if borrowed). Under Kindle Unlimited my income would have been five times what it is. Under the new system, my income is more, as long as those pages get read. Yes, the caveat of quality.

Link to the rest at Write on the River

Here’s a link to Bob Mayer’s books

Are Authors Leaving Kindle Unlimited?

4 July 2015

From author Chris McMullen:

With the July 1, 2015 changes to Kindle Unlimited comes much anxiety among KDP Select authors.

But before you press your PANIC button, maybe you should consider this novel idea: Check the numbers.

That’s exactly what I did, and you can, too:

  • Visit Amazon’s homepage.
  • Hover your mouse over Shop by Department, then hover over Books, and select Kindle Books.
  • See the number listed with the Kindle Unlimited filter.
  • Click the Kindle Unlimited filter. Now check the numbers in the categories.
  • Copy/paste the numbers of interest into Microsoft Word, for example.

I did that on July 1, and I’ve done that periodically for several months so that I can compare the numbers.

There is a lot of talk about authors possibly leaving Kindle Unlimited, but you don’t have to guess. The data is in plain sight.

. . . .

There were about a million books in Kindle Unlimited heading into July, and there are approximately 1,015,000 today (July 3). Of course, this figure is constantly changing.

It’s gone down by about 4,000 (out of over 1,000,000) since July 1. That’s 0.4%. A few authors are taking advantage of the early opt-out opportunity, but 0.4% doesn’t constitute a mass exodus.

In comparison, over 40,000 books were added to Kindle Unlimited in the past 30 days, and the overall number of 1,000,000 is way up from 600,000 when Kindle Unlimited made its debut one year ago. Throughout the program, KDP Select books have had a 95% (or greater) renewal rate, and overall number of participating books has steadily grown every month.

. . . .

With the Kindle Unlimited policy change comes concern:

  • What if a huge number of books pull out of KDP Select?
  • What if a huge number of books pull out of the children’s, erotica, or other categories?
  • What if subscribers cancel their Kindle Unlimited subscriptions because they can’t find the books they want?

These are valid concerns. But it hasn’t happened yet.

You should keep an eye on the numbers. Then you won’t have to guess or worry. You’ll know.

If any of those things happen, you can be aware of it, plan for it, react to it.

So far, they haven’t happened, so you don’t need to pull the plug prematurely on your own books.

What if the number of books in Kindle Unlimited stays roughly the same? What if the number of subscribers remains roughly the same?

What if you earn more money with the policy change than you had been?

You should plan for these cases, too.

Link to the rest at Chris McMullen and thanks to Bill for the tip.

Here’s a link to Chris McMullen’s books

New Writers: This is What’s Going on With “Author Earnings Report”

2 July 2015

From author Amy Stirling Casil:

We wrote about how Barnes & Noble is a lonely, frightening place for a young book: and it is. Any retail consultant would be appalled by what goes on in most B & N stores. Crowded aisles, merchandise on the floor, dusty shelves, merchandise used as decoration, uninspiring displays, and we did not even go into the stockroom, where we have heard some book shipments are simply stored until it’s time to return the unopened boxes. Those books (midlist, usually) aren’t ever even shelved since clerks don’t think any customers will want them. That’s some broken sales pipeline. Much like the troubled businesses on Bar Rescue, Restaurant: Impossible, The Profit and the late, lamented Gordon Ramsay’s Kitchen Nightmares: nothing about the business itself could possibly contribute to flat or declining sales and profit. Barnes & Noble is in trouble because “no one reads any longer” and “young people don’t read” and a million other excuses.

So, a lot of people who love reading and writing think Amazon is the solution. The Amazon Kindle is an amazing device, and I personally use it extensively: I am right in the middle of that device’s sweet spot demographic. I’m a college-educated woman who appreciates the ability to make the e-book type any size and shape I like. I know how to quickly find books I’m interested in.

. . . .

[W]e caught some blowback because we supported Ursula Le Guin’s contention that Amazon’s system is causing a problem for books and readership by focusing on quick-selling, short-term books.

The blowback was from Hugh Howey adherents and enthusiasts. We were informed we should look at Author Earnings Report to find out what was really going on with books and readers. Some commenters suggested we were not aware of such options as Amazon KDP (Kindle Direct Publishing) or quality print on demand options like Amazon’s CreateSpace. Those were the nice folks. The other ones were getting a kick out of slagging on a National Book Award winner (Ursula Le Guin) and calling me names.

. . . .

So, here’s the deal, new writers. To you, this report means exactly nothing. This is heat, light, smoke, almost totally wasted time and effort. It covers Amazon Kindle book sales and nothing else. It covers pricing information and what it presents is pretty dubious. The report has simply proven that non-traditionally published e-books sell in the Kindle format on the Kindle device. It refers to a “shadow industry” of books without ISBNs – i.e. books with ASINs only, the Kindle identifier. Similarly, books can be sold via Smashwords without an ISBN.

. . . .

When people talk about the large share of the book market that Amazon has, they are referring to their print sales plus their e-book sales. No one really knows what Amazon’s aggregate total really represents in terms of market share, except the overall trade publishing industry is a $27 billion industry in the U.S. and we recently determined that Amazon’s maximum revenue for books was about $7 billion last year and we’re being very generous about it: 26% of the market. That is a whole lot. But if e-books just overtook the paper book sales via Amazon less than a year ago (they did), that’s 13% of the book buying market — and that is stretching it.

If I deal with the numbers that “Author Earnings Report” is trying to use to represent the market opportunity for indy-published writers, I’ll just extrapolate the “1 day earnings” for indy-published writers it estimates for May 1 sales: $1.1 million USD x 365 days = $401.5 million. That is 1.4% of the total market. Amazon’s practices mean little good news for Amazon-only authors, that’s for certain. And Amazon does not seem to be growing readership.

. . . .

All you have to do is walk into any tech/electronics store like Best Buy or mobile provider store like ATT or Verizon and talk to customer service reps about who is buying what. The Kindle Fire, despite all of Amazon’s efforts, isn’t being adopted at the high rate of Apple, Samsung or other products. Marcus Lemonis, the Profit, could easily tell you why; and Amazon’s policies regarding its book content and acquisition aren’t going to help the situation much. Right now, the Kindle is a tablet, but it didn’t start out that way and Amazon’s business was built on getting books — paper books — into the hands of 1995′s readers. Now it’s 2015.

People don’t read books much on tablets so far (overall), but they are starting to do it more and more. Students definitely want textbooks and resources on their mobile devices. They do, consistently, when questioned, say they prefer paper books.

. . . .

The Kindle serves people who already liked to read before they got one and who were a particular type of book buyer and reader. It’s a secondary, downstream device and market. It will never be an upstream, introductory device and market unless it changes a vast number of things about how it acquires content.

Link to the rest at Amy Stirling Casil and thanks to Cedar for the tip.

Here’s a link to Amy Stirling Casil’s books

Amazon set to pay self-published authors as little as $0.006 per page read

2 July 2015

From The Guardian:

Self-published authors could be paid as little as $0.006 per page read under new rules planned by Amazon.

Writers who make their works available through Amazon’s Kindle Owners Lending Library, and a similar service called Kindle Unlimited, will no longer be paid per copy downloaded following a move announced last week.

Instead, they would receive a payment based on how many pages had actually been read, with longer books receiving a higher potential payment than shorter works.

In an email to authors, sent on Wednesday, Amazon revealed exactly how little that payment would be.

The company said that customers of its two services read nearly 1.9bn pages in June, while it expected to pay at least $11m a month for June, July and August.

That means the payment per page read could be as low as $0.006, meaning that an author will have to write a 220-page book – and have every page read by every person downloading it – to make the same $1.30 they currently get from a book being downloaded.

Casey Lucas, a literary editor who works with self-publishing authors, says she has lost six clients already. They have decided to stop writing after “estimating a 60–80% reduction in royalties”.

“A lot of self-published romance authors are disabled, stay-at-home mums, or even a few returned veterans who work in the field because a regular job just isn’t something they can handle,” she says. “People are shedding a lot of tears over this.”

. . . .

Not every author will lose out, however. Since the overall amount paid out to writers is intended to remain the same, there will be winners – mainly those who write longer books that are read in full.

Link to the rest at The Guardian and thanks to Dave and several others for the tip.

PG thinks a lot of the Amazon alarmists getting all caught up about the $.006 per-page headline and are not thinking through the numbers.

Here’s what an author receives for a 300 page book borrowed and read at $.006 per page:

$0.006   per page
300         pages
$1.80     received by author

Let’s compare this to the amount received by a traditionally-published author for a 300 page book sold by Amazon:
$9.99    e-book sales price on Amazon
70%      royalty rate to publisher
$6.99    received by publisher
25%      royalty rate to author
$1.75    paid to author’s agent
85%     received by author after agent deducts 15% fee
$1.49   amount received by author
$0.005 per page

Of course, the per-page payment to a traditionally-published author drops even further as the publisher-set sales price drops.

PG understands the concerns about pages read, but if a reader who borrows a KU book reads any pages, the author will receive a little something.

Additionally, PG suspects that borrows are much more of an impulse action than purchasing a book. If PG is correct, authors who would not have received any income from ebook sales to a reader or group of readers will earn something from the non-buying readers who borrow. At a minimum, if the borrowers read no pages, the author is in the same situation as if the borrower had never purchased the ebook.

If a reader buys an ebook from Amazon, either indie or traditionally-published, reads the entire book, then returns it within 7 days, the author receives no compensation at all. If the reader does this habitually, Amazon will eventually close the account, but a lot of zero-royalty reads will have taken place by that time.

Erotica Authors Pull-Out on Amazon KU

2 July 2015

From author Selena Kitt:

Erotica authors were impatiently waiting for July 1, for a look at the new dashboard and the opportunity for a glimpse into the Bezos crystal ball at what they might be paid for the month of July, when the Kindle Unlimited changes took place.

Looks like the numbers are (kind of) in… and the outlook is rather dismal. Erotica shorts authors knew it was going to be bad. I just don’t think most of them thought it was going to be quite *this* bad. Because it looks as if authors will be making about $0.0057 per page. That’s slightly less than half a penny a page, folks.

. . . .

But we’re erotica authors. We are the most versatile, adaptive and scrappy bunch of people I have ever known. And if Amazon thought we were going to take this lying down?

Bwahahahahahahahahahaha. Then they don’t know us very well!

Introducing the #releasetherate campaign

The objective is twofold:

1. Get Amazon to tell us how many people are borrowing our books, without which our page counts are utterly useless

2. Get Amazon to tell us how much they mean to pay us – NOW. IN ADVANCE. No more of this, “Enroll your books, choose to go exclusively with Amazon, and we’ll tell you later how much you’ll make” crap!

Link to the rest at Selena Kitt and thanks to Toni for the tip.

Here’s a link to Selena Kitt’s books

Analyzing Kindle Unlimited’s New Page Read System

2 July 2015

From author Susan Kaye Quinn:

Amazon gave indie authors an unexpected data-gift by releasing the number of page-reads in June along with the payout for the KDP Select program ($11M for the pot divided by 1.9 billion page reads = 0.6 pennies per page). Here’s my breakdown on the numbers you want to know in the newly launched (today) page-read system in KDP Select program.

. . . .

OLD MODEL – per-borrow
98k novel = 414 pages* = $1.34 per borrow = 1/3rd of penny-per-pg
15k novella = 51 pages* = $1.34 per borrow = 2.6 pennies-per-pg

*the number on the product description pg

NEW MODEL – per-page-read (assuming 100% read)
98k novel = 553 pages** = 0.6 pennies-per-pg*** = $3.32 per 100% read
15k novella = 85 pages** = 0.6 pennies-per-pg*** = $0.51 per 100% read

**KENPC page count
***estimate from June moneyz

. . . .

1) The per-borrow model favored short reads, to the cheers of short story and serial writers and boos of novel writers. The per-page-read doesn’t play favorites – pages read are pages read, no matter if they’re in short stories or novels. The NEW MODEL is blind to the length of story.*

*even though I write both serials and novels, I think this is a good thing.

2) The 0.6 penny payout per page in the NEW MODEL is roughly equivalent to 1 penny per page under the OLD MODEL. Why? Because the pagecount is higher with the NEW MODEL. A penny a page is about halfway between what serials and novels were getting under the OLD MODEL. In other words, Amazon leveled the playing field, bringing the payout for novels up and the payout for shorts down… but the overall money in the system about the same.

3) The system hasn’t changed for readers, so borrow rates, at least for now, should be similar to before.

My Major Conclusions

1) Serials still make money with borrows, just not outrageous amounts like before – my 15k novella is making 51cents per borrow vs. 35 cents per sale (assuming 100% reads). This means KU for serials and shorts still makes sense.

2) I’m putting my serial boxsets in KU, as long as they don’t have a permafree first episode – because I suspect read-through will be better, plus putting borrows on the box set increases visibility.

3) Otherwise, I’m holding tight (keeping most properties where they are right now) to see if the payout rate really is 0.6 pennies per page in August.

4) Borrow payouts are more comparable to sales earnings now… depending on your pricing, page-length, page through-read, etc. My 98k novel lists for $3.99, which is $2.79 for a sale, but $3.32 for a borrow. My 15k novella lists for $0.99, which is $0.35 for a sale, but $0.51 for a borrow. All of that is assuming 100% read-though rates, which is overly optimistic, and that the 0.6 pennies per page rate holds.The payout for borrows is comparable to sales at approximately 70-85% read-through rate.

Link to the rest at Susan Kaye Quinn and thanks to Terah for the tip.

Here’s a link to Susan Kaye Quinn’s books

Apple’s mistake was hooking up with the book-publishing cartel

1 July 2015

From Fortune:

An appeal court’s decision finding Apple guilty of collusion with publishers reinforces just how cozy a cartel the industry was.

Apple may be trying to keep the spotlight on its latest foray into the streaming-music business, but it is also still trying to clean up the mess caused by its ham-handed entry into an earlier market: book publishing. A federal court on Tuesday rejected the company’s appeal of an earlier ruling that found it guilty of orchestrating a conspiracy with the major book publishers, in what the court said was a successful attempt to artificially inflate the price of e-books.

As Fortune‘s Jeff Roberts reports, the court found Apple engaged in collusion with what amounted to an oligopoly—namely, Harper Collins, Penguin, Simon & Schuster, Hachette and Macmillan—and that its actions were a clear breach of antitrust law. Apple argued that the deal it cut with the publishers was necessary to blunt Amazon’s dominance in the e-book market, but the appeals court didn’t buy that argument. Judge Debra Ann Livingston wrote:

“Competition is not served by permitting a market entrant to eliminate price competition as a condition of entry, and it is cold comfort to consumers that they gained a new ebook retailer at the expense of passing control over all ebook prices to a cartel of book publishers.”

One reason the court failed to buy this argument is that the major publishers clearly had zero interest in actually competing on price—in fact, they wanted to do exactly the opposite. Their interest in doing a deal with Apple stemmed from a desire to maintain the existing favorable price structure for books, which allowed them to milk the market for high-priced hardcover versions of new novels before eventually releasing cheaper versions. Amazon’s low-priced e-books were a threat.

. . . .

The fact that the book industry was a cozy cartel is reinforced by the court’s description of how the publishers behaved even before Apple came along: They “operated in a close‐knit industry and had no qualms communicating about the need to act together,” the ruling says, quoting from the lower-court decision: “On a fairly regular basis… the CEOs of the [Big Six] held dinners in the private dining rooms of New York restaurants, without counsel or assistants present, in order to discuss the common challenges they faced.”

Since the publishers didn’t compete with each other on the basis of price, the appeals court decision says, “publishers felt no hesitation in freely discussing Amazon’s prices with each other and their joint strategies for raising those prices.”

. . . .

After strong-arming Amazon into accepting the new “agency pricing” model—in which the publishers got to set the price for their books, rather than allowing the retailer to do so—the book industry got exactly what it wanted. According to research by the Justice Department, the price of newly released books rose by an average of 24% and bestsellers climbed by 40%.

It says a lot about the book-publishing business that doing this actually caused book sales to drop fairly dramatically across the board: research done by another expert using data from Random House showed that publishers who switched to the agency model sold close to 15% fewer books than they would have otherwise. So the industry was effectively willing to trade a short-term decline in sales for the increase in power that they got over pricing as a result of the deal with Apple.

Link to the rest at Fortune and thanks to Michael for the tip.

Apple Loses Federal Appeal in E-Books Case

30 June 2015

From The Wall Street Journal:

A federal appeals court on Tuesday upheld a 2013 decision finding Apple Inc. liable for conspiring with publishers to raise the price of e-books.

The 2-1 ruling Tuesday by the Second U.S. Circuit Court of Appeals in Manhattan follows three years of litigation, millions of dollars in legal fees and a bold decision by Apple tochallenge the U.S. Department of Justice to a trial, even after all the publishers with which it was accused of colluding had settled their cases.

The iPhone maker is expected to pay $450 million, most of it to e-book consumers, as part of a November agreement with private plaintiffs and 33 states that joined the Justice Department’s 2012 lawsuit accusing Apple of violating civil antitrust law. The deal hinged on the outcome of the appeal. The penalty amounts to less than 3% of the Cupertino, Calif.-based company’s profit in the quarter that ended in December.

“We conclude that the district court correctly decided that Apple orchestrated a conspiracy among the publishers to raise e-book prices,” wrote Second Circuit JudgeDebra Ann Livingston. The conspiracy “unreasonably restrained trade” in violation of the Sherman Act, the federal antitrust law, the judge wrote.

. . . .

At the time, publishers were dissatisfied with Amazon’s aggressive discounts. Apple’s agreements ceded the power to set prices to the publishers, in what’s known as an agency model. But there was an exception: If another retailer were selling an e-book at a lower price, the publisher would have to match that price in Apple’s bookstore.

With a new outlet for their e-books, the publishers had the leverage they needed to reclaim some pricing power from Amazon, Justice Department lawyers said. Change was inevitable: The publishers couldn’t afford to sell their e-books in Apple’s store at Amazon’s discounted prices of $9.99 for most best sellers.

Prices on many e-books increased immediately. Lawyers for Apple said the company unwittingly facilitated the push against Amazon by the publishers.

But the Second Circuit majority said the evidence showed the technology company knew what it was doing.

“Apple understood that its proposed contracts were attractive to the publisher defendants only if they collectively shifted their relationships with Amazon to an agency model — which Apple knew would result in consumers facing higher e-book prices,” Judge Livingston wrote in a decision joined by Judge Raymond J. Lohier Jr.

Link to the rest at The Wall Street Journal (Link may expire) and thanks to Nirmala for the tip.

When PG first read the trial court’s opinion, he was impressed by two things:

  1. The good job the trial judge did in analyzing the evidence in the case and crafting an excellent opinion that was unlikely to be overturned on appeal.
  2. How amazingly inept the the price fixing conspirators in Big Publishing and Apple were. The evidence showed them to be a bunch of bumblers and their testimony during trial did nothing to ameliorate this impression.

In a nutshell, Apple can now ask for a rehearing in front of the three judges who just ruled against them or an en banc hearing before all the judges in the Second Circuit or try to persuade the Supreme Court to accept an appeal.

PG doubts any of these paths would change the result in this case.

He will warn all and sundry to expect sporadic outbreaks of Amazon Derangement Syndrome.

Amazon launches one-hour London delivery

30 June 2015

From The Bookseller:

Amazon UK has launched Prime Now in London, which will allow customers in the capital to receive purchases within one hour of ordering them.

Only Amazon Prime members are eligible for the service, in a further move to encourage customers to sign up to the £79-a-year membership.

Prime members will have to download the Prime Now mobile app for one-hour delivery, which can be used on over 10,000 items from Customers will have to pay £6.99 for the less-than 60-minute service, but can also elect a free two-hour delivery slot, running from 8am until midnight, seven days a week.

. . . .

Amazon said the one-hour delivery service is powered by its “growing network of fulfillment centres that utilize high-end technology to speed up order delivery times” and for now will be fulfilled by Amazon Logistics’ delivery station in East London. Among the orders Amazon suggested customers might need within an hour are “daily essentials such as coffee, batteries and nappies, as well as other popular items like games consoles, toys and sports equipment,” which will be delivered “right to their door in an hour or less.”

. . . .

While the company will not reveal exactly how many Prime members it has in the UK, it has said it is in the “millions”. Worldwide, the membership [grew] 53% last year, with “tens of millions” of members.

Link to the rest at The Bookseller

A Gronking To Remember Lawsuit Gets Strange While Amazon Argues Liability Would Chill Speech And Art

29 June 2015

From Techdirt:

Somewhat surprisingly to me, the tale of the now infamous eBook, “A Gronking To Remember” continues to develop. Yes, this whole thing started when a book purportedly written by a woman named Lacey Noonan, which details one housewife’s sexual liberation at the sight of Patriots tight-end (heh) spiking a football, was taken down off of Amazon. The speculation at the time was that the cover of the book was the cause of the takedown, with the NFL being the likely complainer, as the cover features Gronkowski in full uniform.

. . . .

We learned later that the NFL wasn’t actually the reason for the takedown. Instead, it was the photo of that couple embracing had apparently been appropriated from the wider interwebz without permission by the author or whoever designed the cover. That couple, choosing to remain anonymous, was suing not only the author but Amazon and Apple as well for selling the work on their respective platforms. So, what have we learned since?

Well, to start with, Lacey Noonan is a dude. Greg McKenna to be specific. Which, whatever, there’s no reason a guy can’t write sex-fics about a housewife wanting to nail a football player, but it was a surprise. We’ve also learned that the New England Patriots did indeed complain to Amazon about the appearance of the team’s uniform on the cover, but it turns out Noonan/McKenna removed The Gronk from the cover and republished the book again, with the image of the anonymous couple still in place, we assume. We’ve also learned that Amazon has an automated system that checks the works authors seek to publish for pure plagiarism or insanely offensive material.

Link to the rest at Techdirt

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