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Originally Posted by Fbone
Some of Amazon's terms aren't author friendly but it is spelled out in plain language.
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They're friendly enough considering the writer is leveraging somebody else's IP and audience instead of building their own. (There lie legal dragons.)
Most people doing fanfic are doing it out of love for the material but that love doesn't give them any more proprietary rights over the original material than somebody who is hired to do a STAR WARS or STAR TREK project.
Kindle worlds stories need to be seen as a variant case of work for hire, not a variant case of original fiction writing. Since all fanfic is by definition a derivative work of the original copyright, the "safest" (for the IP owner) legal option is to assign control of the derivative to the owner of the original, in return for the contracted remuneration.
Example: Let's say David Weber sets up a Kindle Worlds playground for his Honorverse and a fanfic story introduces a character with a certain resume and backstory and Weber--who may not have the time or inclination to even sample the resulting stories--later introduces a similar character that gets added to an HBO series based on the series. Without the assignment of rights to Weber, he might be subject to a lawsuit for a share of the video royalties from the wildly successful series. At some point he might find himself trying to prove ownership of his own character.
Faced with those perils, a lot of authors simply refuse to allow or acknowledge any fanfic. And by treating these commercialized fics as work-for-hire, the legal peril is contained.
The writer of the fic who doesn't like the terms has choices; forgo commercialization, recycle the material into a distinctly separate IP, or accept that the owner of the original IP has rights and interests that need protecting.
Tricky stuff.