Jeff Almighty: Kindle Unlimited is about leveraging access to Amazon’s mega catalogue, and control of the entire value chain.
July 18, 2014 by ruediger
Kindle Unlimited is not just another subscription offer, but yet another key component in Amazons 2 central strategic lines of action: First of all, to organize access to the world’s largest catalogue for reading (and making $$$ as a collateral benefit – which will never bring significant income for anyone else but the by far strongest player(s) around). And second, this helps very much in the ambition of controling the entire value chain (or more radically: to replace all the other competitors, by one walled empire, defined by Amazon).
In this context, Kindle Unlimited can be huge, because it confronts traditional publishers with nothing less than an altogether new, and radically different, business modell then what used to be the bread and butter for 2 centuries: To sell and buy books one copy at a time. Including all those existing author contracts that, again, compensate the creators with a cut on that old model.
For Amazon, as the aggregator and community hub, it is relatively easy to make that radical switch. For the publishers, and everybody else, this will cause a huge headache. It will ever more benefit only the very few peak bestselling authors (and perhaps the largest publishing giants), and further dilute income, and sustainability for all of the rest.
The momentum of Amazon’s catalogue building, and now the launch for Kindle Unimited reminds me of its behind the scene frenzy before the introduction of the Kindle, back in 2007. Yes, back then, the Bg Six were largely on board, which is not the case now. But re-consider the hardball game with Hachette, or the gossip about talks with Simon & Schuster, in the light of Kindle Unlimted. These confrontations come in handy now, before the backdrop of yet another Amazon controled sales channel, and a huge handle in tightening up the Amazon consumer community – and to show everybody the sign on the wall, which reads: Be careful, and think what it would mean to NOT have your titles prominently featured by us.
Jeff Almighty has a strong run these times. It will require a lot of ingenuity, and cold blood, for everybode else to come up with a good answer to him.