Kindle Owners Lending Library: KOLLing on the Pros (and Cons) for Writers

posted by Saul

Ever since Amazon announced that it would be paying authors to allow their ebooks to be borrowed through its Kindle Owners Lending Library (KOLL), the etherscape has been abuzz with opinions spanning every possible extreme. Detractors argue that Amazon is trying to put other book distributors (read: B&N, Apple, Google...) out of business at the expense of writers, and once they do, the terms under which authors publish with Amazon will suddenly become as unfavorable as they already are in legacy publishing. Supporters argue Amazon is offering authors an opportunity to reach more readers and to legitimately offer their works for free for a defined period of time, something Amazon has been loath to support in the past.

Whether the former turns out to be true is irrelevant, since those making such predictions simply don't know, and those with insight into Amazon's strategy won't tell. As for the latter, the question of whether an author wishes to participate must be decided on an individual basis. There are both positive and negative aspects to consider.


KDP Select
For those not familiar with the program, called KDP Select (KDP stands for Kindle Digital Publishing), an author has the option to enroll his/her book for free. An enrolled book then becomes available for borrowing to Amazon Prime members for free. Amazon compensates the author for that borrow. Prime is Amazon's "preferred customer" program, and participation (currently for $79/yr) provides members free 2-day shipping on purchases and streaming of videos, as well as access to the Lending Library.

Let's bring in the Pros

1. Money

Writing is its own reward, but let's face it, writing doesn't pay the bills, selling books does. For cash. Every writer's wish is to be successful enough to make it a career, and that means getting paid. To incentivize writers to enroll their books in KDP Select, Amazon has set aside a pot of money (minimally $6 million dollars for 2012) and allots it month-by-month depending on borrowing activity and Prime membership. In December, the pot was $500K and each borrowed book earned the author $1.70. The pot for January was adjusted to $700K due to the large number Kindle readers and Fires received over the holidays and because of free 30-day trial memberships in Prime, As expected, the number of borrows grew significantly, earning authors $1.60 per borrow. For February, the pot dropped to $600K; authors have reported a drop in borrows, consident with expiration of trial memberships.

2. Broader reach

Without an audience, no book, no matter how good it is or how timely, will even have a chance. Self-promotion is a necessary evil for independently published writers, and this adds to their toolbox. For readers, KOLL offers a no-risk way to discover new writers.

3. Growing membership

Amazon is stingy with its numbers, but whether the figure of Prime members is five million or ten or twenty, a combination of two factors foretells a growing audience of readers. First, participation in Prime is growing (although probably more slowly than Amazon predicted). Second, as more Prime members become aware of KOLL, the number of borrows will increase. In January, the number of borrows was still less than half a million. In other words, at most ten percent of Prime members took advantage of KOLL and borrowed a book. (Prime members are allowed one borrow per month).

3. Free promos

Unlike other ebook distributors, Amazon doesn't allow its independent authors to offer their works for free...unless they're enrolled in Select. The workaround to this was to offer a work elsewhere for free and then have Amazon price-match it, a strategy that actually violates Amazon's terms of service (ToS). Authors unwilling for personal reasons to utilize such a strategy were stuck with a minimum price point of 99 cents. Now, if a title is enrolled in Select, an author can offer the book for up to five days every ninety days for free. The author has complete freedom to schedule the free promo whenever and however (all at once, separate days) they chose.

Why offer for free? For the same reasons a writer offers a book through KOLL. It's all about visibility. First, free means more readers, readers who will hopefully: 1) spread the word about your book, either through reviews or in their own social netoworks, and 2) buy your other books.

There's also an affect on rankings. Free downloads affect your book's rankings and thus its visibility to shoppers.

4. Competitiveness

At the moment, legacy publishers (ie., the Big6 and many of the smaller houses), are resisting offering their books for free through Amazon's lending program. Thus, Select provides independent writers a way to compete against the machinary of the legacy houses.

5. Buy-through effect

Free promos often (not always) are followed by a bump in paid sales. 'Nuff said.

The Cons have their say

1. Exclusivity

This is the biggie. If you enroll your ebook, you agree to offer it only through Amazon (this doesn't affect print versions, even if they're the same book, only digital versions) for a period of ninety days. That's a long time not to have your ebook available through Smashwords, Barnes and Noble, Diesel, iTunes Bookstore, Sony, etc. You can't even offer the book through your own website.

2. Opting out

You have a couple days to opt out of the program if you change your mind. After that, you're stuck. You can withdraw the book from Slect, but you're still have to abide by the ToS, meaning, you can't offer your book elsewhere for the duration of that 90-day period.

3. Auto-renew

Select auto-renews your book unless you specifically opt-out of the auto-renew feature. This requires action on the writer's part and, undoubtedly, some writers will find themselves unhappy when they find their book stuck for another ninety days when they wished it wasn't.

4. Loss of royalties

Any violation of the ToS or withdrawal of the enrolled ebook before the ninety-day period is completed will block payment of any earned royalties. Amazon clearly states how they intend to remedy any already-paid royalties should either of these things happen. Read the ToS for more details.

5. Inflexibility in promo price

While a free promo is a nice option to have, there is not flexibility for the writer/publisher to offer the book at a reduced (but not free) price. True, it's easy to adjust the offer price on a book and the change is relatively quickly reflected on the book's page, but what I'm talking about is the option to show a book is reduced from another price point, say from $5.99 to $2.99, thus offering the book for 50% off. The psychological impact of this on a shopper is not to be underestimated. Leagacy publsihers know this and have that flexibility in pricing for marketing purposes. True, showing 100% off (for a free book) is a bigger savings for a customer than 50% off, but it also has a psychological impact on readers that accumulates over time. It says, "This author is desperate," and it devalues a book unnecessarily.

6. No lasting effect on rankings

The effect on ranking of a free ebook persist only for the duration of the promotion. The book's ranking either immediately or very quickly returns to its pre-promo ranking.

7. Anti-competitiveness

Whether a writer supports Select or not, the exclusivity required does create an anticompetitive environment.

Educate yourself

The choice to enroll in Select is an individual one, but it's one that should only be made after careful consideration of the advatages and disadvantages. Read Amazon's ToS carefully, then solicit the opinions of fellow writers who have their books enrolled. Their experience will help you decide whether or not you want to participate.

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Saul Tanpepper is the author of several self-published books of specualtive fiction, particularly horror, suspense, and paranormal. He also babbles dabbles in dark humor and science fiction. You can find all of his books here at Amazon.com, including his recently released specfic collection INSOMNIA, seven paranormal, science fiction and horror tales. All of his books are enrolled in Select and so are available for free borrowing by Amazon Prime members. He frequently offers a selection of his books for free (usually on Saturdays), so check back often.