Kindle allegedly breaks lending contracts

US authors are raging against Amazon's new Kindle Owners' Lending Library feature, claiming that their books are being given away for free without their consent in direct breach of publishers' contractual terms.

The feature - a perk of signing up to Amazon's Kindle Prime Membership for $79 a year - allows users to download a free book from the marketplace once a month. The problem comes from the fact that while Amazon does pay a price for each book downloaded, publisher's didn't agree to having their author's work given away for free.

According to the Authors' Guild, Amazon had recently approached the largest publishers in the US - Random House, Simon & Schuster, Penguin, HarperCollins, Hachette and Macmillan - over participating in this scheme, but was turned down by them all. The large e-tailer then went on to the smaller publishers, who also refused. However, it seems that this latter rejection was ignored by Amazon, which simply listed the books in the scheme anyway.

The way the company is getting away with this for now is through a strange interpretation of its current contracts with publishers, which states that it must pay a wholesale market value for each downloaded book. However, the fine print doesn't discuss giveaways, subscription or anything of the like. As a result, Amazon is able to charge exactly what it wants for products, as long as it gives the publishers a wholesale price for it - including, the bookseller appears to believe, giving them away for free.

As well as the loss of control, it's also thought that schemes like this could be used to entice users to buy some author's books by offering others for free. Publishers aren't allowed to do this as, of course, it paints some of their writers as not being worth full price. However, Amazon isn't limited in the same way that publishers are, meaning they can hint at an author's value with its own pricing structure.

The Authors' Guild gives advice on what to do if your book is in the scheme and you don't want it there: the first step is contacting your publisher, who may or may not have included your book willingly. You do have some recourse, but it's not easy.

It looks like there's potential for a legal battle between publishers and Amazon, but for now there's just some preliminary shoving going on.