I've been reading about the Kindle Unlimited controversy in Clean Indie Reads over on Facebook and some other places. This is my two cents prespective for the publishing industry and the readers that feed it.
Personally, I don't see what all the hullablloo is about. I've been tracking my sales and burrows for months now, and if anything, both of them have gone up. I'm certainly getting more burrows than I used to but it's not as if my sales have been seriously negatively affected. The two of them are about the same; within five or so of each other in this second half of the year. (As of this post, my sales outnumbers burrows 3.5:1.) My royalties are also better than they were in the first half of the year. This dissonance causes me confusion so I thought it over.
My book is going for 99 cents on Amazon right now, so I suppose that could be part of the reason. At this price, my royalty deal is 33%. If I wanted the 70% deal, I'd have to price it higher, like 2.99. (I suppose my reasons for this are related to the discussion, but it's still a digression so I'll move on.) Even if the Kindle Unlimited deal for a single burrow is 1.33 dollars instead of 2, that's still siginficantly more than I'd get for a sale. I've seen people that set their ebook at 5, 10 and even 13 dollars. At the 70% royalty deal, then even the full two dollars would look small in comparison.
It stands to reason why Amazon doesn't pay full price for a burrow. Authors are paid when a Kindle Unlimited user reads 10% of the book. For a 100 page novel, that's 10 pages. That's basically an extended preview. Since the reader pays a flat rate for the Kindle Unlimited service, then depending on how many books they sample, that one book costs them nothing. They don't have to commit to the book and the author still gets paid. If Amazon paid 100% of the price for 10% of a book, then the company as a whole would make even less money than it does right now (zero).
As far as I've heard, there's something about Amazon giving Indie burrows part of a pot of money while paying big publishers a full commission. I haven't seen that on Amazon itself so I can't be certain. According to those same sources, the biggest publishers aren't in Kindle Unlimited anyway, so it's a moot point.
I think it's a control thing. Authors think they've lost control because Amazon uses a complex formula to determine Kindle Unlimited pay rates instead of allowing the authors to set it like for the sales section. This perception is an illusion. Kindle Unlimited is part of KPD Select, and authors can choose whether or not to have their books be part of this program. If you don't like it, you have the power and option not to do it. This then leads into another control thing: KPD Select means being exclusive with Amazon but, again, I don't see the problem.
As far as I've read, Amazon has the biggest slice of the ebook market. It's like 70 percent. Everyone else has to split 30 percent. Even if I have this wrong, it's still the basic picture. It's better to stick with the big kid on the block so they'll help you move more books then spreading yourself thin over a bunch, right? In order to keep an author's business to itself, Amazon provides other ways to move books, make money, and gain readers. It's a compliment because Amazon sees these authors as valuable and something it doesn't want its competitors to have. "Do all your business with me, and I'll help you increase your business." I've heard some argue that it's the reading platform that's a problem; only Amazon means only Kindle. That's also not a problem because there's free conversion programs available out there, and also, traditional paperback. The bottom line is that Amazon does not demand exclusivity from every author publishing with it.