The “Library Loophole”: How to Stay in KU and Still Sell to Libraries in 2026

For over a decade, independent authors have faced a brutal binary choice: The Golden Handcuffs or The Wide Road.

You either enrolled in Amazon KDP Select to get access to Kindle Unlimited (KU) page reads—giving Amazon total digital exclusivity—or you “went wide” to sell on Apple, Kobo, and Barnes & Noble, sacrificing the massive visibility of the KU algorithm.

But in late 2025, the walls of the garden came down—at least partially.

In a quiet update to their Terms of Service, Amazon introduced what savvy authors are now calling the “Library Loophole.” For the first time, you can keep your eBooks in KDP Select (earning page reads) while simultaneously distributing them to public library systems like OverDrive, Hoopla, and Palace Marketplace.

This is the “Hybrid-Exclusive” model, and it is the single most profitable distribution strategy for Urban Fantasy authors in 2026. Here is how to execute it without getting your Amazon account banned.

The Economics of the “Double Dip”

Why does this matter? Because Urban Fantasy readers are “whales”—they read high volumes of books very quickly.

• In KU: They devour series like The Spirit Saga, generating Page Read royalties.
• In Libraries: They use apps like Libby to borrow books funded by institutional budgets.

By utilizing this new policy, you are effectively “double dipping.” You monetize the subscriber via Amazon, and you monetize the budget-conscious reader via their library’s acquisition budget. You are no longer leaving free money on the table.

The Execution Strategy: A Step-by-Step Guide

WARNING: This strategy requires precision. If you accidentally distribute to a retailer (like Kobo or Apple Books), you will violate your KDP Select agreement and risk account termination. Follow these steps exactly.

Step 1: The Amazon Side

Enroll your eBook in KDP Select. This keeps you in Kindle Unlimited and makes you eligible for the 70% royalty rate in exclusive territories.

Step 2: The Distributor Side (Draft2Digital)

You cannot upload directly to libraries (OverDrive/Libby) yourself; you need an aggregator. Draft2Digital (D2D) is the industry standard for this workflow.

1. Upload your book to Draft2Digital.
2. Navigate to the “Publish” step (Step 4).
3. THE CRITICAL STEP: Under “Digital Stores,” you must UNCHECK every single retailer.
   • Apple Books: Unchecked
   • Barnes & Noble: Unchecked
   • Kobo: Unchecked
   • Smashwords Store: Unchecked
   • Amazon: Unchecked (You are already there direct).
4. Under “Library Services,” CHECK everything.
   • OverDrive, Hoopla, Baker & Taylor, Palace Marketplace, Bibliotheca, etc.

By doing this, you are telling D2D: “Do not sell this to customers. Only sell this to institutions.” This complies with the new Amazon KDP Select terms that allow for non-retail distribution.

Step 3: The Pricing Multiplier

Here is where the profit margin explodes. Libraries do not buy books like individuals; they buy licenses. Because a library book might be read by 50 people, the industry standard is to charge a premium.

• Retail Price: $4.99
• Library Price: $14.99 – $19.99

On Draft2Digital, set your Library Price to 3x your Retail Price. Libraries are accustomed to these prices; it is how traditional publishing has operated for decades. A single library sale at $14.99 nets you a royalty of roughly $9.00—equivalent to selling 3 to 4 copies on Amazon.

The Takeaway

The era of “All or Nothing” is over. In 2026, the smart Urban Fantasy author is a hybrid. You can dominate the Kindle charts with your page reads and have your book available on Libby for your local librarian to order.

Check your distribution settings today. If you are in KU and you aren’t in libraries, you are ghosting an entire segment of your audience—and their budget.

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