There have been rumors, scary rumors that may have put some publishers on edge, but it turns out things aren’t so bad. Amazon announced the launch of the dreaded Kindle Owners Lending Library, where Amazon Prime members can borrow books. But this service does not include any books from the Big 6 publishers, and members can only borrow one book at a time, once a month. Many of the books come from small and mid-sized publishers as well as some successful self-published authors. Word is that Amazon paid those publishers a large licensing fee to keep the books in the service for two-years, and publishers are required to pay their authors a “lump sum.” Amazon calculates the amount of the lump sum according to a book’s 12-month sales history. Some publishers are skeptical of this program, especially those who use the agency model and price their own books, since it may mean giving away premium content at a loss, therefore hurting the publishing business. On the other hand, publishers using the wholesale model, where retailers determine the price, see this service as a type of promotion.
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