Possible Dangers in Amazon's KDP Select Program

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InklingBooks
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Tue Dec 20, 2011 4:51 am Post

Smashwords's Mark Coker has a blog posting on "Amazon Shows Predatory Spots with KDP Select." Keep in mind that this isn't digital publishing through Amazon. It's a special addition to that publishing that Amazon is now pushing. But note that Amazon is apparently making is easy to accidentally opt into Select without intending to do so.

http://blog.smashwords.com/2011/12/amaz ... h-kdp.html

Here's part of what Mark Coker has to say:

At first glance, the program looks enticing. Amazon has created a $500,000 monthly pool of cash they'll distribute to participating authors based on the number of times your book is borrowed from their new lending library....

But there's a catch. Actually, multiple catches, which are outlined in their Terms and Conditions:

1. For the time your book is enrolled in the program, you cannot distribute or sell your book anywhere else. Not Apple, not Barnes & Noble, not Smashwords, not Kobo, not Sony, not even your own personal blog or web site. Your title must be 100% exclusive to Amazon.

2. If you violate their exclusivity terms at any point during the three-month enrollment period, or you unpublish your book to remove it from the program so you can distribute your book elsewhere, you risk forfeited earnings, delayed payments, a lien on future earnings, or you may get kicked out of the Kindle Direct Publishing program altogether.

3. Your enrollment, and thus your liability to Amazon, automatically renews every three months if you neglect to opt out.

Amazon has also modified the Kindle Direct Platform's user interface with the effect of making it almost difficult not to enroll your books. Where they once placed their pull down menu for managing your book's settings, they've now placed the enrollment link. The pull down settings menu is moved to the bottom of their dashboard.


Read the entire article, keeping in mind the courage Mark Coker is showing with those words. Smashwords has agreements to distribute ebooks with all the other major distributors. He would no doubt like to distribute to Amazon too. This makes that less likely. The guy has guts. He's also one of the few in the epublishing business who seems to really have the interests of writers at heart.


The dangerous legalese from Amazon doesn't surprise me. Several years ago, I was involved in the beta testing for a program called Amazon Shorts. The basic idea seemed to be a good one. Authors publish a series of short stories or a book in installments (Shorts) and, when they finish, they release the entire book. It seemed like an excellent incentitive to write one piece at a time. But there were two major catches.

* As above, being in the program meant not being able to publish elsewhere for a time that might prove to be very frustrating if, for instance, a major publisher appeared eager to release it in time for Christmas sales.

* A non-disclosure agreement from Hell. I've got more legal background that I sometimes like to admit, and I know that nondisclosure agreements are not the sort of thing you sign lightly. Courts can get rather unpleasant, insisting that if you signed it, you must obey it, unfair or not.

Using my position as a beta tester, I forced the Amazon staffer I was working with to bring the issue up with the Amazon lawyer who'd written the contract terms. Since being in Amazon Shorts didn't provide me with any insider information about Amazon, I told that lawyer, the net effect of those terms was to make it extremely risky for me or anyone in Amazon Shorts to criticize Amazon. Whatever I said could be called privileged information, even if it was a conversation overheard on a bus or merely clever speculation on my part. I soon heard back. Amazon's lawyer had refused to weaken those terms and so I refused to sign up for Shorts. In the end, it mattered little, since Amazon Shorts failed, probably due to those those nasty don't publish elsewhere restrictions. Select could suffer the same fate, although perhaps not without hurting a number of authors.

Mark Coker is right. Signing terms like those turns authors into the equivalent of a tenant farmer, totally dependent on an Amazon who, in effect with all these non-distribution elsewhere restrictions, owns the rights to your book.

Here's Mark Coker's summary of KDP Select's key danger:

The new Amazon KDP Select program strikes me as a startling example of a predatory business practice. Amazon has the opportunity to leverage their dominance as the world's largest ebook retailer (and world's largest payer to indie authors) to attain monopolistic advantage by effectively denying its competing retailers (Apple, B&N, Kobo, Sony, etc) access to the books from indie authors.


Another analogy might be that of a coal miner in company housing in a company town where the only place to shop is the company store, as in the country song "I owe my soul to the company store". No author should sell their soul to anyone.

Given policies like these, I may need to correct some earlier comments I made in the forum when I suggested that Scrivener authors publish there books two ways: 1. Direct through Amazon to get the maximum royality it offers. 2. Indirectly to the other ebook distributors through Smashwords to avoid distribution hassles.

It might be better for legal reasons to go through a middle man such as Smashwords for all your distribution to avoid being trapped inadvertently in restrictive conditions and legal penalties if you deal directly with Amazon.

I can't emphasize more strongly that right now epublishing is like the old Wild West. There no 'law west of the Pecos.' There's a lot of nasty infighting going on, particularly by Amazon. You can get into big trouble if you're not careful what you sign. Personally,I wouldn't be surprised if, in the next year or so, some unfortunate author ends up with a hot book that too late they discover can only be sold by Amazon.

Moral: Look very carefully at any agreement before you sign it.

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druid
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Tue Dec 20, 2011 5:01 am Post

Personally,I wouldn't be surprised if, in the next year or so, some unfortunate author ends up with a hot book that too late they discover can only be sold by Amazon.


I'm sorry that you've not had good experiences with Amazon, but ours have been terrific. They promote, they sell, and they generously share revenue. If our next book ends up solely with Amazon, we will consider ourselves fortunate.

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Wed Dec 28, 2011 4:04 am Post

I'm sorry that you've not had good experiences with Amazon, but ours have been terrific. They promote, they sell, and they generously share revenue. If our next book ends up solely with Amazon, we will consider ourselves fortunate.


And for how long do you think that will be true after Amazon becomes virtually the only place to sell ebooks? Do you really think Jeff Bezos has a heart of gold? Take my word for it. I live in Seattle, He's not known here for his philanthropy. He's known for the $1.2 million a year he spends on his own personal security. (That's over $3200 a day.) Nor do the ordinary Amazon employees I talk with feel very appreciated. Do you think you're more valued than they? I think not.

****

A century or so ago, many small towns were delighted when a large railroad built a spur into their town. Remember, this was when roads were terrible, dusty in dry weather and mud holes in wet weather. Rail was the only way to travel. The giant railroad sweetened the deal by offering lower prices than the locally owned rail. Soon, almost everyone was riding on it. And soon after that the little local railroad went out of business.

Does the story sound familiar yet?

With its only competitor out of business, the large railroad then began to raise prices and cut services. In fact, soon the prices were higher than those the old railroad had charged and services were much worse. What were they going to do? The town was now served by only one railroad and its owners lived far, far away, perhaps even in distant Seattle.

Moral: when people focus only on themselves and their present situation, they often make mistakes that they later come to regret. The real crime, of course, isn't what happens to them, but the troubles their poor choices impose on others. Not everyone fell for the blandishments of the railroad robber barons.

The idea that my books might be sold by only one retailer, whether that be Amazon or anyone else, makes my blood run cold. There's more to life than this month's check in the mail.

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kewms
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Wed Dec 28, 2011 6:42 am Post

The history of publishing says that publishers want as much control over an author's work as they can get, while giving the author as little in return as they can get away with.

Until recently, authors had very little choice, because publishers had an effective monopoly over printing and distribution, the only means of reaching an audience.

E-books change that equation, by giving the author an independent and cost effective way to reach his potential audience. But also by potentially giving the owners of e-book platforms at least as much power as print publishers ever had.

I wouldn't expect Amazon to behave any more generously than other publishers in the same position.

Which is to say: go over all contracts with a fine tooth comb, and assume that the contract-twisting abilities of the person on the other side would make Lucifer himself blush.

If a contract sounds amazingly generous, that's the point at which you should either run for the exits or have your own lawyer explain why it's not.

Katherine
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druid
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Wed Dec 28, 2011 8:17 pm Post

InklingBooks wrote:Do you really think Jeff Bezos has a heart of gold? Take my word for it. I live in Seattle, He's not known here for his philanthropy. He's known for the $1.2 million a year he spends on his own personal security. (That's over $3200 a day.) Nor do the ordinary Amazon employees I talk with feel very appreciated. Do you think you're more valued than they? I think not.


Inking, I hesitated to get into this discussion because I thought you had a bee in your bonnet about Amazon, and your reply only confirms my hunch. You attack Bezos ad hominem and turn me into a straw man for your argument, and frankly I don't care for your tone. I don't think I'm "more valued" than anyone else, thank you, although you may (and doubtless will) think whatever you please.

So cling to your point of view, fine; for me and my partner, Amazon works a LOT better than NYC publishing houses that haven't a clue how to market or publicize mid-list books. The great editors are gone, replaced by "English majors" who can barely handle e-mail attachments. Production of a 300-page book takes 18 months; publicity consists of 75 or so xeroxes sent out to book review sources, many of them already shuttered. The book industry we all knew and loved is not just sinking; it's deep into a Titantic-like slide into the sea.

In contrast, Scrivener compiles a 300-page manuscript into attractive e-book formats in a matter of minutes, and the books are better proofed and designed than work done for us by commercial publishers. Yes, we provide all the labor, but it's fun to know we've been in charge all the way and see immediate results for our efforts. Getting online with Amazon has been easy, once we learned the arcana of their database requirements. They report to us frequently on sales, and we may check on royalties any time, day or night. We also feel that Kindle books look better and read more easily than print versions, though that's a matter of taste that we know not everyone shares.

If Amazon can do a better job of publishing for now, we are with them. If they become a Great Monopoly, we'll figure out our next move. We might be expressing the same fears about the forthcoming Apple TV. What if Tim Lee offers everyone a $300 box and $40 a month for a la carte TV, up to 100 channels? Think there would not be a colossal land rush to get on that band wagon, leaving Comcast and Charter in the lurch? The market works like that, and no "monopoly" ever has that long a life-span. Ask Microsoft and the PC makers. Ask the great Hollywood studios of the 1940s. Or Ford and General Motors. Competition thrives. Scrivener was once a Mac-only application; now it runs on a widening array of platforms.

Anyway, let's go our own ways on this issue, since we aren't going to agree. Peace, Happy New Year, and may you and Seattle, that jewel of the Pacific, live long and prosper.
Last edited by druid on Fri Dec 30, 2011 6:25 am, edited 1 time in total.

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Thu Dec 29, 2011 6:34 pm Post

I thought the "exclusive" rights handed to Amazon were for Amazon Prime customers for a limited period of 90 days. The books are still for sale while free on Prime.