Amazon has started what it’s referring to as “a $6 million annual fund dedicated to independent authors and publishers.” It sounds like a fellowship program but it’s actually a pot of money for luring self-published writers into exclusive short-term contracts with the Kindle store. The more bestselling writers the company can lock into the Kindle (however temporarily), the less appealing rival e-readers will be. This has already gotten some authors into trouble with Barnes & Noble, which has refused to stock print books by authors it cannot sell through its own digital platform, the Nook.
According to the terms of the program, if a self-published author makes his or her e-books exclusive to the Kindle store for 90 days or more, then Amazon will include the books in its Amazon Prime library lending program, and the author will receive royalties based on how many times the e-book is checked out. Here’s the press release that explains the math behind it.