Pondering Bezos — Does Kindle Unlimited Exclusivity Help or Hurt Customers?

I was in Kindle Unlimited (KU), for one stint - 90 days, the required term. I really enjoyed the program and the features.  More importantly, Amazon's customers enjoyed my participation -- my eBooks were downloaded a lot.  I left after that single stint for a variety of reasons, including the lack of a guaranteed payment (at least, a guaranteed minimum payment) scaled to the price of participating books. However, Amazon's demand for exclusivity was my most compelling reason for departing the program. It's the largest reason that most authors leave KU.

Amazon requires that in exchange for enrolling an eBook in Kindle Unlimited, that an author grant Amazon the exclusive right to sell that eBook.  That means that readers who use Nooks, iPads, or any other device, could not buy my books.  It meant that the price of participating in KU is telling a whole group of my readers that they are not important, that they don't matter.  I just couldn't do that after my sole stint in the program.  It hurt me to do that because ALL my readers matter.

Making my books exclusive to Amazon would also mean that all my eggs are in the Zon's basket.  It means that at the roulette wheel of life, I've bet all my hopes and dreams on the Zon's number.  I didn't spread them out among several numbers to give myself a cushion; I bet them all on a single number.  That's as poor a strategy in life as it is at the casino.  Yes, it will pay more if that single number hits, but it will cost me everything if any other number hits. The Zon's basket is large and from the outside looking in, it appears sturdy and stable, but I have no inside info.  Amazon could fold tomorrow - or it could cancel its KU program tomorrow.  That would leave me trying to convince readers that I tossed aside like yesterday's leftovers that they are still the main course.  My readers would never buy that - they're an eclectic, imaginative, smart bunch.  They're a tolerant group, but they won't tolerate disloyalty.

Although a few, select "big time" indie writers were offered participation in the program without exclusivity,  some of those have now left the fold, despite still offering their books elsewhere.  They felt that KU was cannibalizing sales on Amazon, prompting potential buyers to "borrow" instead. And borrows are not paid as sales, they are paid much less - an unknown rate set monthly by Amazon lately averaging $1.38 to $1.40 as compared to $2.05 for a sale on a $2.99 eBook.  The "big time" indies lost too much money.  The money and the lack of guaranteed pay out rates also explains traditional publishers staying away from the program.  Amazon surely doesn't require exclusivity from them but the trads had enough business savvy to know that borrows would reduce sales. So, there are issues other than exclusivity, but for the average indie author, exclusivity ranks at the top.

Not only does making something exclusive to one store hurt the author, it also hurts the customers. The market not only functions best when it's competitive,  it also grows more when it's competitive and innovation flourishes as competition does.  Exclusivity is a big scary concept to indie authors.  It makes us slaves on the Amazon plantation, totally dependent on "Master" Amazon. Given a choice between keeping our freedom and signing on for Amazon servitude, many of us are too damned independent, too damned AMERICAN to take whatever Amazon doles out. Perhaps Amazon should take a closer look at what's happened to America in the era of Big Government and reconsider.  Amazon should remove the exclusivity requirement from KU and it should adopt a guaranteed minimum pay scale based on factors including the price of the work, the length of the work, and the sales price for similar books.  All those factors are required because too many game the system - it's a lesson they've learned in the Big Government era.

If Amazon would make both changes, then KU customers would have a much, much - (Did I say much?) - larger and ever-growing variety of books to borrow.  The two policies hurt customers most of all because their selection is limited, severely, by the pay-scale-to-authors and exclusivity issues. If Amazon removed both issues, and made the recommended changes, publishers would likely enroll some items like backlist books, especially of mid-list authors, occasionally high ranking first-in-a-series books of top authors (at least for a limited period) when the top authors had new series books coming out. If Amazon removed only the exclusivity requirement, even keeping the present uncertain and unfair pay scale in place, many indie authors, myself included, would enroll at least some books -- and that would be enough to provide a sizable increase in books available to customers for borrow.

In the long run, Mr. Bezos' refusal to make the necessary changes to fix the KU program will have the opposite effect from the one intended -- it will not only drive away KU customers, it will anger them and make them less likely to buy anything from Amazon.  While Amazon doesn't worry so much about how exclusivity negatively impacts authors, it does, should, and must worry about how it negatively impacts consumers.  Those promised "all you want to read" value by KU who have to hit the buy button to get the books they actually want will, more and more, feel they're spending money for nothing.

Right now KU is like one of those bargain shops.  A customer walks in to buy a nice black dress.  She sees one for $9.99. But wait - there, just beside it, is a bin full of huge sealed bags.  There's a sign over it that says - "Buy a whole bag of dresses for $9.99." The value scale seems obvious.  Why spend $9.99 for one dress when you could get 10 or 15 for the same price?  But when the customer buys the bag, gets home and opens it, she finds that none of the dresses is black or they're all the wrong style. How will the customer feel about that store now?  She'll feel like the KU subscriber promised all the books she wants to read for $9.99 a month who discovers that none of the books she wants to read are in the program.  That customer will feel angry, misled, cheated and lied to - and that will be her feeling every time she sees that store's sign, so she'll go to another one.  How easy is it is, after all, to go elsewhere in the virtual world.

Sometimes Karma works. The Karma of Amazon turning a crop of indie authors into indentured servants will filter down to the customers.  More and more authors will flee the exclusivity noose because writers are, by nature, the most free-spirited and independent people on the planet. That means that Amazon won't be able to deliver on its promise to customers, because that promise depends on motivating writers to continually put more work into the program. Amazon's failure to deliver on its content promise will then begin to drive customers away from Amazon entirely.

Karma's a bitch and that's why Mr. Bezos should change KU.