How Le Guin (Accidentally) Got It Right: Amazon is Manipulating the eBook Market
Le Guin blamed Amazon for destroying for destroying the legacy publishing industry through over-commercialization, a hyper-focus on best sellers, and turning books into commodities. Her arguments were false in that they ignore the historical facts that every complaint she made pointed to a trend which existed long before Amazon was even a gleam in Jeff Bezos' eye (*).
But even though Le Guin was generally wrong in every point she raised, her general argument was true to some degree for a small segment of the ebook market. Amazon is driving a small part of the ebook market in a way that I’m not sure the larger industry has noticed.
I am referring to Kindle Unlimited, or rather KDP Select, the program which Amazon uses to recruit indie authors and publishers into Amazon’s subscription ebook service.
For those not familiar with its history, Amazon created KOLL in late 2011 and used KDP Select to supply the ebooks. They kept the funding high enough that authors would put their novels in, and not just short works. Also, they limited KOLL to a single title, thus making it important that an ebook was worth the rental.
And then Amazon launched KU, and by manipulating the monthly pool of funding they let the payment drop to the point that novels were no longer profitable. Amazon also let KU subscribers read as much as they want, thus encouraging snacking on short works.
As I have been reporting month after month, Amazon has been keeping the funding pool for KDP Select small enough that the payment for each ebook loan has stayed below $1.40 for most of the 11 months since KU launched(**).
This is truly a new world. Short, episodic fiction will be available and it must be created at extremely high volume in order to stay profitable.
I don’t see how trad pub could even hope to compete. I’ve gotten to the point where if I don’t release a new “book” (and I use this term very loosely) every 3-5 days, I’m seeing a big drop off in my earnings.
In 2012, my idea of frequent releases was probably twice a month (and that was still way more than most authors were doing at the time). Now, twice a month is like a snails pace.
Kindle Unlimited’s impact first came to my attention last December when it was mentioned in the comment section of one of my posts about how "Kindle Unlimited is killing retail sales". That trend proved to be less of a trend than an annual cycle amplified by authors seeing their novels do poorly in KU, but in the ensuing debate one commenter raised the point that shorter works were doing better in KU than novels.
And here we are in June, where we find Hugh Howey chiming in, agreeing that he sees the same trend.
Think I haven’t noticed? 🙂 Check out what I’ve been releasing lately. Short stories. And I’ve got two other projects in the works tailor made for KU.
Lest you feel inclined to ignore this as not being part of the true book market, I would remind you that one, when it comes to ebooks length matters less as a distinction than it does in print (where it was primarily a commercial divisor, anyway); and two, these are book authors seeing a market opportunity in short works. Time spent writing those shorter works is time not spent writing novels.
Howey and the unnamed author see a gold rush opportunity in the $9.8 million (and growing) pool of money Amazon is using to fund KDP Select each month.
That is a small sum of money in terms of the entire ebook market, but it is also a section of the market that is both growing and still below the radar of some indie authors. (It is other things as well***.)
And so Le Guin was right to a limited degree.
Just so we’re clear, that pool of funding, KDP Select, and Kindle Unlimited are all the creations of Amazon. The retailer invented a market and continues to manipulate it.
Amazon is driving part of the ebook market, but it is such a small segment that it raises the question of whether Le Guin was wrong on the larger point of Amazon’s power.
I leave that point up to the reader to decide.
P.S. Some of the trends Le Guin complained about, including the commercialization of book publishing, can actually be traced back to before Le Guin was born. See the use of serial fiction in the Victorian era, to name one example. That was less a storytelling device than a response to market conditions.
P.P.S. While we’re on the topics of loans in subscription ebook services, I’d like to point out that the AAP recently announced estimates for the US subscription ebook market for 2014. Those estimates are almost certainly wrong in that they missed most of the activity in Kindle Unlimited and Kindle Owner’s lending Library (I’m working on a post).
P.P.S. Kindle Unlimited is also going to prove a greater threat to magazines and anthologies as the number of short increase.
image by Patrick Feller