Scribd & KU and what those changes mean via Carolyn Jewel
Publishing Newsbook subscription service / Kindle Unlimited / Scribd16 Comments
I saw this great piece by Carolyn Jewel on the changes to the Scribd and KU subscription services and I asked permission to repost it here at Dear Author. Carolyn Jewel is a long time traditionally published author with several different publishing houses. She is also a self published author and, of course, like all of us, a reader. I appreciated (and agreed) with her thoughts and thank her for allowing us to republish this piece. You can find out more about Ms. Jewel at her website or follow her on Twitter or Facebook.
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Some of you may know that Amazon changed the terms of its subscription service, Kindle Unlimited (KU) such that payments due to authors with books in KU are calculated in a different manner than previously. If you’re a reader and you subscribe, you can read all you want for $9.99 a month. With the single limitation, so far, that you can have up to 10 books on your “shelf” at once. To get book number 11, you have to read or release one of those books.
With the Kindle Unlimited subscription you can access hundreds of thousands of Kindle books and thousands of audiobooks with Whispersync for Voice. You can keep up to ten books at a time and there are no due dates. Read your Kindle Unlimited books on any Amazon device, or free Kindle reading app. (Terms)
Scribd reinvented itself from a pirate site reader-centric sharing site (Irony ALERT!) into a subscription service. For $8.99 a month. They paid all authors/publishers the same as a sale.
If you’re a reader, that’s a pretty sweet deal, assuming the books you want to read are in the program.
If you’re an author, deciding whether to have a book in KU is a business decision, and not everyone’s business needs and goals are the same. Everyone’s reasons for being in or out are different. Last year when KU debuted, I blogged about it here. Here’s what I said then about how that would be profitable:
If you are paying authors/publishers a percentage of price, then for your business to be viable, that payout amount per month HAS to be less than 9.99 * (number of users subscribed).
This means a profitable user will read a number of books N per month where the payment due to vendors is less than 9.99. The more books they read, the less the wholesale price has to be (obviously), and, at 9.99 per month, the wholesale price has to be less than 4.99 for 2 books per month, 3.99 for 3 books, etc.
Not long after that post, it turned out the payment terms for traditionally published books in KU were different than for self-published books. Traditionally published books receive the same payment as if the book had been bought — that is 70% of the purchase price. Further, certain self-published authors were given those or similar terms in order to convince them to put their books in the program.
Self-published authors can only participate in KU if they put their books in Kindle Select — that is, have those books exclusively at Amazon. Scribd does not require exclusivity. For some authors, Kindle Select makes sense. But for others, it doesn’t. Doing well at other vendors or wanting to avoid the risk of having a business depend on a single vendor are good reasons not to be in Select and therefore, not in KU.
Traditionally published books need not be exclusive. Because, as Amazon recognized, that would be a non-starter.
Arithmetic
What the Romance community knew, and what I suspect Amazon knew (because DATA!) and what Scribd apparently did not know (Because why would anyone pay attention to what goes on with those books women read?) is that Romance readers are the Great White Sharks of the reading world. They are the 80 in the 80/20 rule. They are the power in a power law.
Solving for X
Remember my ruminations over profit, book prices and that monthly subscription rate? Amazon had the data would have told them everything they needed to know about those Power Readers (before KU debuted). Amazon solved the math problem with deep pockets but also by offering self-publishers a substantially worse deal. The KU reimbursement rates started decently, then took a swift dive until the reimbursement fell to around $1.34. Why? Well, either you sustain losses because of the Power Readers or you find a way to compensate for that. Falling KU reimbursement rates were exactly that, that is, KU’s “flexible” reimbursement rates to self-published authors was their hedge.
As KU continued, Amazon kept talking about how much money they were putting into the monthly fixed KU pool to be distributed to the self-pubbed authors, but reimbursement rates from that pool continued to fall. Because the hedge was needed. (So I speculate.) Scribd had no such hedge in its business model. (To my knowledge, anyway.)
How did Scribd solve for X? They didn’t. It’s hard to understand why Scribd thought $8.99 for all readers was viable even in the medium term. If they knew about Power Readers then they either didn’t know enough or they thought the same thing most of the traditional world thinks about products for women. How could they possibly matter when they were up against REAL books and REAL readers?
$8.99 is a brilliant strategy for competing for potential KU subscribers. It’s not a brilliant strategy for paying authors/publishers in an environment that includes Power Readers. The rational solution after the short to medium term is to introduce tiered subscription rates. It’s blazingly obvious that in an environment that includes Power Readers you must also have a bazillion 1-2 book a month readers or you have to charge Power Readers more. Or you have to pay authors/publishers less. Scribd did a great job going after traditional publishers, and they probably had a better selection of books than Amazon. And, by the way, the word is lots of Power Readers (those sharks!!) had subscriptions to both services. Because the pool of books was different.
But if they charged those readers more, then KU looks more attractive… It’s a tough situation.
Solving for Y by Killing X
Scribd’s solution was to remove 80-90% of Romances from their service.
Sure. Of course. Now they will be paying out less to authors and publishers because the books people women actually want to read are gone. Now that they’ve basically told the Power Readers they are unwelcome with all their womanly reading of THOSE books—who the hell knew they read that much???—what they have left are the 1-2 book a month readers.
This makes a certain sense. Because maybe what will happen is the Power Readers keep their subscriptions to both Scribd and KU, but now only borrow 1-2 books from Scribd and things are sustainable for a bit longer for them. Yes, an FU to romance readers, but Scribd maybe wasn’t in a position to feed the sharks.
If I were a Romance publisher ::cough::Harlequin/Avon::cough:: who just put substantial backlist into Scribd only to have their reader base told to fuck off, I think I’d be pretty pissed off.
The more established self-publishers, the ones who cannot afford Amazon exclusivity financially or at the cost of reader-relations will likely move to Oyster in order to have some presence in a subscription system. I wonder if Oyster knows what’s coming their way?
Cue the theme from Jaws….. LOOK OUT OYSTER!!!
Segue
Early on, long before KU, I put one book into Select into order to have data on the program. I asked my newsletter subscribers to tell me what they thought about my decision. Their answer? The non-Amazon readers were angry. Rightly so. That was enough for me. My experiment was done after the first angry letter. (After 90 days, you can elect not to re-enroll in Select.) If it had been possible, I would have ended it immediately, but I had to wait out the 90 days. I sent a copy of that book to every single reader who let me know how they felt.
Amazon’s Adjustment
The initial structure of KU with its fixed reimbursement pool meant that a longer book that make $2-4.00 for a sale, made $1.34 in KU. Shorter books, on the other hand, that would be sold in the $0.99-1.99 range and thus net the author a dollar or less, made $1.34 in KU. In other words, a book priced at $0.99 made $1.34 in KU. Anyone with half a brain can see that this meant shorter books were way more profitable and that longer books were way less profitable.
The adjustment Amazon made was to address that disparity. Instead of paying the same amount per borrow regardless of length, authors are now paid based on pages read. “Pages” read, actually. Basically, Amazon had to normalize what a page means for a digital book when displays are reflowable and resizable across different sized devices. A “Kindle Page” is the same for all devices regardless of settings. (Presumably, of course.)
To me, that’s fair enough. Authors who write shorter books make up the difference by writing more books. I should think that’s obvious, though apparently not. Category authors tend to write more books than single title authors. Three 30K word books will make you the same as one 90 page book, assuming the books are read all the way through.
I have to shake my head at the suggestions from some that readers should make sure to page through shorter books, because otherwise those authors are screwed.
No they’re not. They’re only screwed if readers never actually finish the books, and if readers aren’t finishing their books, well, maybe those authors should worry about why that is. There absolutely is a market for shorter books and short stories. Just like there’s a market for longer ones. I have short stories, novellas, and novels on sale. They achieve different goals for me. I’m quite sure that readers have different goals and preferences for reading works of varying lengths.
Final Thoughts
I don’t have any books in KU. I did have books in Scribd, but I assume the only thing left is Scandal, which is currently free and so would not have been removed. I’ll probably go pull Scandal because I’m vindictive that way.
But now I’m kind of wishing I did have something in KU because at last at LONG LAST Amazon is giving authors data about how much of their books get read, but the only way to get it is to be in KU. I had this idea that authors could put a book in KU, let it sit for 90 days and watch the data about pages read. You’d rewrite if no one gets past Chapter 10. ::snort:: Mostly I’m kidding.
[Update: MelJean Brook pointed out that Amazon is NOT providing meaningful page read metrics so my plan would not work. There is no way to tell from the data provided if 2000 Kindle pages read is 2000 people reading one page or one person blowing through 2000 pages of an author’s work.]
I Lied. This is the Final Thought
I was talking to a friend the other night about why Amazon didn’t fix their issue sooner since they surely had the data about the problem of shorter works no later than 6 months in. Assuming that’s true, that gives them 6 months to develop, test, and QA and then prepare the PR for the Kindle Normalized Pages scheme. This is aggressive but doable. You’d have to test a lot of scenarios and then make absolutely sure all the calculations are correct and reach consistency.
Maybe the schema changes weren’t as big a deal as they would be in a traditional SQL Server or Oracle environment, but NoSQL solutions have different challenges, and one of them is hidden errors because of eventual consistency or problems with “schemaless” documents. (It’s only schemaless if you never hired a data architect, and if you didn’t sooner or later you’re fucked. *)
I’m thinking of Wattpad and its problem with user comments attributed to the wrong account. That’s a total NoSQL error that a good OLTP-trained data architect could have said, hold on a sec here… What happens if…. And then all the developers stick their fingers in their ears and sing LahLahLahLahLah because the architect just added 3 months to the delivery date. And nine months later your data is untrustable. There are scores of developers out there who got burned by thinking schemaless means never having to think about data consistency across transactions.
Eventually, your financial data has to be in a transactionally consistent state and stay that way and it can never ever revert to a previously inconsistent state. Or you can’t pay people correctly. So, you know, 6 months seems like a decent guess for how long it would take to roll it out and be certain it works for paying people reliably. The concept isn’t hard. The execution is.
Interesting.
* OMG. I actually made a database joke in a writing blog! More than one, actually. This is very strange.
Note: Regarding NoSQL, it’s a very very fast way of scaling data. Although UC Berkeley had one of the early such databases, Amazon more or less put the concept into widespread use, followed by the original developers at You Tube who had to massively scale MySQL. Those guys needed to ramp up fast and on a scale that traditional transactional database could not then achieve. When I say “documents” in the sense of a NoSQL database, I don’t mean a Word document. I mean a collection of information of related items where Item 1 may not have the same information as Item 2 in the same set of related information. In that sense, there is no “schema” (that is a definition of what information is contained in related data. In a transactional database, all objects of a defined type have the same structure, even where elements of the structure are NULL.)
The NSA, by the way, collects your information in Hadoop, a NoSQL database backed up with some Postgres SQL functionality for the sorts of transactions that MUST be consistent.
This is a laughably high level explanation. It’s way more complicated. I’m a SQL Server DBA and Data Architect, but I’ve done some Mongo DB where we needed to address some shortcomings with our SQL Server applications without spending a fortune. For anyone who cares, Microsoft’s SQL Server 2014 changed the query optimization engine in significant ways — and I suspect it’s a direct response to NoSQL. For example my current employer had ugly queries that were taking 2 minutes (on completely under resourced SQL 2008 servers and for data that SHOULD have been in a datawarehouse but wasn’t, so I’m sorry, but the situation is long and convoluted and no one here cares, just know that 2 minutes for a query result is beyond embarrassing) that went down to 45 seconds when run on a SQL 2014 install.
Basically, the point is that the situation is considerably more complicated than, hey, let’s do it THIS way instead. Amazon is not just a company that sells stuff. They INVENTED the technology they needed to massively scale because no one else was doing that, and then they open sourced it. So when we talk about Amazon having advantages, the advantages are even bigger than most realize. Amazon IS data. I don’t think they do anything without knowing what the data says, and they have more data than anyone.
It’s why we’re seeing such an upheaval in publishing. It’s why Romance matters more and it’s why companies and analysts who dismiss Romance are in big trouble. Amazon knew about Power Readers. The usual gendered biases very likely got exploded by the facts. Traditional publishers need to lose the bias. Companies who want to compete in this space need to fire anyone who talks about REAL books and REAL readers.
The Romance Sharks will eat their lunch.
This is a really great post! The thing is I belong to neither. Why? Because KU does not have the books I read regularly. It’s too limited considering I read a lot of big authors. I do/don’t have a Scribd account. I signed up for the 3 month trial and used it twice. So I won’t be re-upping. I had just found an author or two who had their entire backlist up and I was considering reading through them. Then a lot of the books vanished. Wow! So…yeah that subscription is out.
What I’ve been doing is buying digital only copies periodically but utilizing the paper self-pubbed/rare copies through my local library. I got the last three Josh Lanyon (Adrien English Mysteries) from Hawaii State Public Library (I’m U.S. east coast). It cost me nothing and saved me 6.99 a book. Not everything is available through the library but it certainly puts a dent in what I have on my TBR list. [It does cost the library money but keep that in mind. It’s mostly shipping costs and my library has that built in their budget.]
I LOVED this piece. I hope the dealmakers at the traditional publishing houses read this article as well. I’m getting tired of being a marginalized reader because I prefer romance. That doesn’t mean I don’t spend money on other books, it just means I spend a great deal on what I like. Amazon has figured out a way to garner a significant amount of my cash (223 books in my TBR pile. Yikes!). I have no patience for Amazon haters (Ursula Le Guin) when they seem to be the only company that takes my reading genre seriously (for cash of course). KU here I come.
Maybe I’m being cynical, but I suspect Scribd’s plan is more devious than that. It is still a pirate site. Check, I’ll bet a good number of those now missing books are still up there, just not in a form that gets the author paid. I’m betting they’re banking on a number of subscribers either not knowing, or not caring about the difference.
@Erin Burns: When you search for a book or author on Scribd, the results show up in different ways: books, audiobooks and “other files”. I really haven’t noticed any pirated books coming up in searches. Since you can also buy books from Scribd (if they’re not offered in the subscription), I would think that Scribd would have a pretty decent incentive to keep pirated stuff to a minimum. That’s just what I noticed, but I haven’t been looking too hard. I didn’t realize they were initially a pirate site.
Great essay, Jane. I canceled my Scribd subscription. Screw you, Scribd. I’m pretty torn between KU and Oyster right now. The problem with KU is that they never have any books that I want to read. But it would be nice to just go all in with one service for subbing and buying books.
Thanks for sharing this. I’m a romance shark (ha!), and I was just debating a Scribd subscription yesterday. I may purchase a subscription for a few months and glom away, but I wouldn’t be a long term subscriber if they kept reducing their romance selection. I had KU for a few months, and I found that the selection didn’t really match my reading habits.
I would be willing to pay >$10/mo for a subscription service as a power reader that reads over $50+ of e-books per month. Perhaps Oyster will be the ticket once they increase their romance selection.
I don’t have any patience for Amazon haters either, because I really like their e-readers, and they have great customer service. I’ve never received anything less than stellar help with any issue or question. They also have great prices, unless a publisher makes it impossible. I loathe seeing that “price was set by publisher” note. An ebook should not cost as much as a print book!!
2.5 months ago, I started the Scribd 3 mo trial and was initially very excited and told friends with similar reading habits about the great selection. I was already budgeting the fee in my mind. Then I started having trouble finding books! When I saw the post on DA about them drastically reducing their romance selection, I finally had an answer about what was happening. This means of course that I will not be continuing the subscription. In the last 2 weeks, I’ve had trouble finding any book I was looking for :(
Great to see this post here, Carolyn. And BTW, you still have four books at Scribd as of this morning (Scandal and three others).
I disagree with your argument that Scribd is dissing women readers in general, though. Power romance readers (who are a subset of all romance readers) are being screwed by this, certainly. But women who don’t read romance at all or who read romance and a lot of other fiction are not nearly as affected. There are more women than men reading fiction overall, and more women *in every genre of fiction*. I do agree with the commenter to Robin’s post earlier this week that cozies may be next on the chopping block. Those books are also short-ish and consumed in great quantity.
All of us are speculating about Scribd’s situation in the absence of data, so here’s mine: It wasn’t the indies that created Scribd’s recipe for disaster, it was the Harlequin deal. Indies and small romance pubs are part of it, sure, but I’m guessing Scribd’s membership base increased a lot when they added Harlequin, and readers started glomming backlists. They might have been able to ride out the short-term losses of free memberships and huge payouts, but if they weren’t increasing the non-power-reader membership numbers, their backers were not going to keep giving them money.
That’s why I don’t think you’ll see Oyster adding Harlequin anytime soon. It would have the same effect there.
It’s also worth noting that there is no subscription service (that I know of) which is making money right now, in terms of revenues, and there are a variety of payout models across the different media.
@Erin Burns:
Erin: I probably should have explained the piracy comment a little better. But first, there is no evidence that Scribd is allowing pirated works into the subscription portion of their business. They aren’t doing that. However, the document sharing portion of their site is still active and there are still plenty of pirated book there.
Before they changed to/added the subscription model Scribd was kind of like Goodreads+Wattpad only with “writers” sharing books or other documents. The huge benefit was that documents could be posted to Scribd for people to read embedded in another site. Legal documents, for example. It was a great solution. The problem, of course, was lots of those “writers” were actually pirates or readers who didn’t understand they were pirating.
There are authors who feel very very strongly about piracy and who felt/feel that Scribd deliberately did nothing to prevent this from happening and did not care about addressing the issue. I am not commenting on whether that is the case, by the way. But that was the perception among authors.
The real problem came with the switch to the subscription model. Reportedly, several Romance authors were told that their pirated works would be removed ONLY if they put their books in the subscription service. I can only say that I heard this often enough that I give this some serious weight. At best, Scribd completely bungled the author relations part of this.
So, there are many authors who have issues with Scribd for that reason alone. I don’t believe Scribd is aware of the level of anger and resentment.
I was being sarcastic about the piracy comment since so many Romance authors feel that’s what Scribd was and is. Their original business model was not to be another instance of Pirate Bay.
Thanks for the insight here on Scribd as well as KU. I have two books in Kindle Select… trying it out to see if I like it, if the sales at Amazon make up for the books not being on sale anywhere else. So far, results are negligible so I’ll be bringing at least one book out of select (one is a short story that I’m not all that concerned about) and going back to publishing them across all markets. I don’t find the model to be particularly author-centric… though I guess I didn’t really expect it to be. They want to make the most money possible. They’re not concerned about readers.
As for scribd, if i was a strictly romance reader, and a fan of HQN especially, I’d be as angry as the people I see talking about it. I read widely, though and I am at scribd mostly for audiobooks. I haven’t even logged in since the change, but we’ll see how my library has been affected and decide if I am going to stay.
I have subs at both scribd and KU. Some of the best material I have read by black authors has been self published and many of those authors have enrolled their books in Select. I get to read those books for my monthly fee (books i might not have purchased because I won’t/can’t afford to buy 20 books at $3.99) and those authors now get paid because I read it.
It does make me wonder about strictly romance fans… will they go back to stalking sales, hope the catalogs make it to Oyster, borrow them from the library? What is the new plan to acquire books going forward.
@Sunita: Interesting about my books. Yesterday someone told me Scribd was listing 7 books of mine but only 4 were available. The unavailable ones were books still with Berkley, where Berkley has only North American rights — though I don’t know if that matters. The others were books that had reverted to me or were original self-published words. And now it’s down to three.
Scribed was making me some fairly good money, so I’m sorry that they couldn’t find a way to make it work. But they likely feel a tiered subscription isn’t competitive with Amazon.
I would definitely agree that Scribd didn’t deliberately diss Romance readers. It was just “OMG, who ARE these readers who are killing us????” and it just happened to be Romance readers which was, in my opinion, completely foreseeable. Except, I theorize, gendered biases about women readers prevented them from analyzing the actual market instead of the perceived market.
I also agree that cozy mysteries might also be an issue. My sister is a huge cozy mystery fan. She reads loads of them.
That’s what I find so ironic about this. So much of the harm of biases like this are hidden. You don’t know you could sell 10x more product if you’d just stop targeting only a male market. You only know you sell a lot to those guys. This is a situation were the bias is a quantifiable harm to the entity unable to see the bias. Because that’s what I think is part of what’s going on. Companies mistake the market — our cultural biases prevent them from seeing there’s a bigger opportunity if only they’d stop seeing their current market as the actual market.
I agree that the Harlequin deal was part of the issue. But as long ago as a year or so, there were self-published authors saying they were making good money from their books in Scribd. After I got my books there, I can say that was true. So the Harlequin backlist issue amplified an existing condition and probably made the crisis happen sooner.
It’s hard to say yet if KU is making Amazon money. Unique among subscription services KU has the ability to manage profitability by reducing payments to self-published authors. It’s telling, to me, that the pool amount kept increasing while payout amounts decreased. That was at least partially an effect of authors (and not just romance authors) deliberately chopping up books into small parts for KU.
@Carolyn Jewel: That’s actually one reason I ended up putting my novel on Scribd – it seemed the best way to keep it from ending up in their “files” edition as a pirated copy. It bothered me greatly when Scribd decided to go semi-legit, but rather than being forced to clean house publishers (traditional and self alike) let them get away with the model of “well, if you don’t put your books on us how would we know” and continuing to allow anyone to upload anything as a “file”.
Crunchyroll was a well known pirate anime site for years, then they decided to go legit. The first thing they did was wipe out all of the pirated stuff, period, and no more user uploaded content. It was the only way the licencors would have ever agreed to work with them. Now they are one of the top distributors of streaming licensed anime out there, and you won’t find a single pirated anything anywhere on their site.
Why Scribd was allowed to do otherwise I do not know…
(I do also wonder if the romance folks will jump to Oyster and if it will do any good. From my understanding, Oyster’s business model is the same, except they don’t allow the files stuff. So will they be able to sustain the power readers much longer?)
@Anma Natsu: I know there were authors who did as you did, which was go into Scribd subscriptions in order to get them to remove pirated works.
As a point of pure speculation — fun!!! — I would guess that because Scribd has a lot of legitimate file sharing from fairly large sources — as in legal documents and the like, that the solution of simply removing all shared files would have been a harm to lots of very large sites that were embedding completely legal content. I appreciate that they did not do that.
Heavy-handed responses to piracy claims are a real, quantifiable harm to readers and authors alike. So it’s not an issue of Scribd being “allowed.” Personally, I do not want to find us in an environment where content is assumed to be guilty of infringement and I fear that’s where some of this is headed.
@Carolyn Jewel:
Carolyn, I may be misunderstanding the documents section. But, my understanding is if you have a Scribd subscription, you don’t have to go through the rigamorale of uploading a document in order to download a document. If that’s no longer the case, I’m more than happy to be corrected.
@Erin Burns: I actually have no idea if a Scribd subscription is tied to upload/downloads in the document sharing section. I thought those two things were completely separate. But, Google is my friend and I have learned that they are not. The Scribd FAQ (scroll down to the bottom) http://support.scribd.com/entries/64067067-How-do-authors-benefit-from-Scribd-s-premium-membership-program- speaks for itself.
I’ve never liked Scribd. Goes back to its file-sharing roots, when it insisted all over the place “Download or print anything for FREE”… until you actually tried to do it. First you had to log in, then you had to upload something, and that’s as far as I got.
Why? Because they didn’t realize that people would use the site for illegal file-sharing. So they put up this restrictions, without ever changing the advertising.
To top it off, they actually went looking at forums for how people were working around the barriers (ya know, to do what the site advertised itself as), and blocking them.
So, the lack of planning and the badly-handed reaction? Totally predictable. One of those times I hate being right.
I have to laugh. Even without all that DBA/data/etc, ask anyone who has reading friends to tell you which genre-reader is the most voracious, and you’ll likely keep hearing “romance.” Because that’s what I see among my reader pals and family. It’s even what I see in my own reading past. I’ve always been an avid reader, from the first year I could read through a book by myself. That 9 year-old haunting libraries and bookstores. :D When I was into romance hard–a span of 13 years, roughly–I’d read a book a day, easy. When I was on the couch sick, 2-3 easy. I’d get basketfuls of books at Waldens/B&N/etc weekly or from the used bookstore. And, btw, the used bookstore lady was a member of RWA, and the largest volume of books in her store: romance. Romance readers have mad hunger for stories. :D
My main genre is SF, but those aren’t as fast a read for me as romances were.
So, really, did nobody at Scribd just LOOK around?