The problem with writing about a current event is that the information is always changing. It really is a moving target.
When I first heard the various reports on Kindle Unlimited, one particular data point really stuck in my craw—as well as that of many other independent writers. But after sitting and thinking on it for a while, I began to consider that I might be thinking about it the wrong way.
When a subscriber reads at least 10% of a book—measured by page turns in the subscriber’s Kindle ebook reader—the author/publisher gets paid. (Note: it is actually the publisher who gets paid. Because a self-published author is, in fact, his own publisher, he gets paid directly. Traditionally published authors are paid by their publishers a percentage of what was collected.)
What had so many independent writers so upset was that Amazon had different share agreements for traditional publishers and self-published writers.
Self-published writers were paid a share from a fixed fund of money, divvied up according to the percentage of how many of a given author’s books were read compared to the total number of reads for that month. So, if only 100 books were read for a given month, and 2 of them were mine, I would get paid 2% of the pool.
Big-5 publishing companies and a few smaller publishing houses were given a different deal: they would be paid the same amount of money per read as if the book had actually been purchased. So, where I had to settle for an amount that was potentially 60% less than if my book had been purchased, they would get their full share.
The catch is where that money is coming from. Is it coming from the fund Amazon sets up each month to pay author’s who join the Kindle Select program? Or is it paid from another account, leaving the pool just for independent authors?
This is actually a fairly vital point.
If the money to pay Big-5 books is coming from the same pool that independent authors are paid from, then yes, independent authors are getting the sort end of the stick. But if the payout is coming from different funds, then that changes the picture.
The fundamental flaw with Kindle Select Lending Library is the only way an author is going to make decent money from books being borrowed is if that author has a really good following of fans. The Lending Library limited Kindle Prime members to reading just one book per month.
Danielle Steel is one of the top selling authors in the world and has sold an average of 1.2 million books per month throughout her career. (I’d be happy with just 10,000 books sold in a year!) So she makes a good example.
If I put my book into Kindle Select Lending Library at the same time Danielle Steel put her newest book, I think we can all correctly guess whose book is going to be wildly borrowed for the month. Sure, there might be 1.2 million reads, but perhaps only 3 of them will be mine. I would get paid $2.46 from a $1M pool. Danielle Steel would get most of the $1M pool, having nearly 100% of it. Not much of a payout for me for a month.
Kindle Unlimited puts no limits on how many books a subscriber may read. So that does increase the possibility that when a subscriber grabs Steel’s book, that subscriber might grab mine out of curiosity. I might get six reads for the month.
If Steel’s proceed share per read was being paid out of the Kindle Select Fund, she alone with her 1.2 million reads would empty the pool. She would walk away with nearly all the money, while all the independent authors would get deposits of pennies in their accounts.
If Steel’s share was being paid from a different account, then that leaves the entire pool available for just the independent writers.
This means, they would be paid a much larger amount per read.
The different share agreements removes the big name authors from the competition. Previously, independent writers had to compete directly with them. An independent writer debuting and having no fan-base would be screwed trying to outsell the top-selling authors. By removing the top-sellers from the equation, new and undiscovered authors have a chance to make a gain from participating in the program.
Maybe the two-tiered approach isn’t such a bad thing.