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Amazon essentially gets exclusivity for free now with no extra benefits for the author. The few things they offer (ability to do a countdown sale or a freebie) aren't worth that much. A freebie and countdown cost the author because 1. free doesn't earn money and most authors take out advertising so it COSTS them in the short run and sometimes the long run. 2. The kindle countdown deal is practically hidden now compared to where it was a year or more ago. I'm running one right now and you don't even see that it's on a countdown deal because they stashed the counter so far on the right that most people won't even notice it. If it's a benefit, I can't tell.
Let's see... the other benefits are that you can be paid about 2 dollars for an average length book (75 words nets about 2 dollars per read) if the book is borrowed via subscription routes. This can be less than an author was making for a sale. So that's a wash.
So far as I can tell there really is no added 'advertising' for authors in the program. If an author takes out an ad, those who have a subscription to KU might read a book they otherwise might not have noticed.
But all in all, I don't think Amazon does much for the exclusivity. (This is not a complaint--it is something I NOTICED after being in and out of the program. No one forces an author to be in the program).
Their market share numbers have, indeed, reached levels where it's probably a bad thing for an author, especially a new one trying to get noticed. (It's hard for any author to be noticed, but the odds are only getting worse at this particular time).
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