Quote:
Originally Posted by pwalker8
That's really the issue. Yes, things are set up so that Amazon can not lose money. My understanding is that they get $X, take their cut, then split the rest between authors based on some algorithm. They can't afford a death spiral of authors leaving because they aren't making enough money and subscribers leaving because they can't find anything they want to read.
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Of course Amazon cannot lose from KU. That is why this service saw off its competitors. Why it is now the only unlimited service available. It is a remarkable business model. Authors and publishers in KU trust Amazon. An author in KU is guaranteed nothing. Amazon allocates a pool of funds to be divided according to pages read. No one knows what Amazon makes, how the per page rate is calculated or the amount of the pool. It has even been speculated that Amazon has sometimes subsidised the pool, particularly in the early days. Successful scammers don't take from Amazon. They take from other authors with works in KU. In return for this trust, Authors can easily take works out of KU and put them in. Amazon cannot afford to have authors lose trust and take too many works out, or to lose too many subscribers. However, should this ever happen Amazon may well close KU if they can't fix it. Quite frankly I don't see this happening anytime soon.