All of that may be about to change, thanks to an Amazon Associates agreement revision that's set to take effect March 1 of this year:
March 1, 2013 version
The following is added at the end of the sub-section:
(a) 20,000 or more free Kindle eBooks are ordered and downloaded during Sessions attributed to your Special Links; and
(b) At least 80% of all Kindle eBooks ordered and downloaded during Sessions attributed to your Special Links are free Kindle eBooks.”
A Little Background On Amazon's Associates Program
Amazon Associates program participants can provide a link to virtually any page or product on Amazon (including links to free Kindle books) with their Associate ID attached to it, and that ID piggybacks on most purchases the customer makes on the Amazon site during the same shopping session. So Associates have historically had an incentive to share ANY Amazon link, including links to free Kindle books.
If anything, links to free Kindle books have been very desirable for Associates program participants to use because shoppers' resistance to clicking through on such links is low: the product in question is free, after all. But very often, once on the Amazon site, the customer will start browsing or will think of some other item they've been meaning to buy, and commissions for those purchases are paid to the Associate whose ID first brought the customer to Amazon.
Possible Chilling Effects of the Associates Policy Change
There are two factors to consider when trying to forecast possible outcomes of this change:
1. This new policy puts ALL of a given Associate account holder's commissions at risk in any month where "sales" of free Kindle books from that Associate's links are high.
2. With this new policy, authors and Associate link / promo providers who used to have the common goal of maximizing click-throughs on free Kindle books are set in opposition to one another. The author still wants to maximize downloads during the free promo period, but the more free downloads are generated, the greater the risk that the Associate link provider will lose all of his commissions for the month.
In my opinion, this will be a pretty effective discouragement for many Associates to promote free Kindle books. Even if the bar for commission loss is set pretty high (both of the above-quoted conditions must be met for a given month's commissions to be forfeited), the mere possibility of commission loss may steer many Associates away from continuing to promote free Kindle books.
What's Amazon Up To?
This policy revision speaks to some business changes on Amazon's end.
Amazon is surely aware that the free Kindle promo option has been a major driver in getting authors to sign up for their KDP Select program, but recent changes to Amazon's book sales rank algorithm have drastically reduced the formerly positive effects of large numbers of free downloads. While a given book's sales rank isn't exactly penalized for free downloads, free downloads are no longer driving the kinds of sales rank leaps and bounds that drew authors to take advantage of free book promo periods in the first place.
Now add the disincentive for Associates to promote free books, and it definitely starts looking like Amazon is moving to discourage publishers and authors from offering their Kindle books for free.
Has Amazon Finally Turned On Indies, As So Many Predicted Would Happen?
Since the great majority of authors and publishers who have been willing to offer their Kindle books for free are indies, some may conclude this is some kind of long-planned attack from Amazon on indies in general, but I doubt it.
Sales rank algorithm changes levelled the sales rank playing field again to a great extent, but maybe sales rank integrity wasn't all that was troubling Amazon. Maybe Amazon never anticipated how popular and widespread free book promotions would become, and how large a percentage of their monthly Kindle book "sales" in any given month would eventually come to consist of free downloads. Every free Kindle download represents a loss to Amazon, since Amazon is absorbing overhead costs to host and sell the book but isn't earning any profit on it.
Given that Amazon only earns money on downloads of Kindle books people are actually paying for, I think the most obvious and simple answer is the correct one:
Amazon is tired of losing money on free book downloads.
But once the genie was out of the bottle and indies everywhere had made free downloads an entrenched part of best practices for any new Kindle book launch or promotion, nobody outside of Amazon or mainstream publishing was motivated to stop the runaway freight train of free Kindle books.
Even indie authors and publishers who don't want to offer free promo periods have felt pressured to do so, since others who did offer their books for free have sometimes seen such great results.
You May Have To Start Making Money On Every Kindle Book Download, Whether You Like It Or Not
I can only speculate about the long-term impacts of this most recent policy change, but after thinking it over I've concluded that in the end, it's probably a good thing. The change gives indies a good, solid business reason to move away from offering their Kindle books for free; what's that old expression, about how a rising tide lifts all boats?
When the majority of us are selling our books at a price instead of giving them away, the majority of us will be making money on every download.
When free Kindle books become the exception instead of the rule, book buyers will stop 'waiting till it's free' or even having an expectation that a given book should be free. I was never one of those who backed the 'devaluation of books and literature' argument, I've always thought that within reason, ethics and the law, any promotional tack that gets an indie author more exposure and sales is worth trying. Even so, I think the prevalence of free Kindle books has shaped---some might say distorted, or even dominated---the ebook market in ways that few predicted, and it has ultimately hurt indies overall more than it has helped most of us.
The former, nearly guaranteed sales rank boost one could expect from a free promo period is all but gone, thanks to algorithm changes. Yet many have continued to cling to the free promo gambit like a drowning man to a piece of driftwood, because it has worked for so many authors in the past.
In the face of the very daunting book launch and promo task, a free book promo was at least something an indie could do pretty easily to get his or her book in front of as many eyeballs as possible, and an easy "in" to book blogs and sites. Like I said before, a free product is an easy "sell". And if most customers who were taking advantage of those free promo downloads were actually just book hoarders, collecting but never actually reading hundreds of free titles, well, most of us preferred not to think about it.
Amazon may be trying to force authors, publishers and book bloggers alike to stop offering and promoting free Kindle books, but in so doing they're forcing us in the direction of more profit for everyone. It's hard for me to see that as anything but a positive development.