On the face of it, Amazon’s Kindle Unlimited seems like a win for everyone. Readers pay their monthly subscription and can read any books registered under KDP Select for free, while authors get paid for every page that subscribers read.
Until you start running the numbers.
If you’re a well-established author with a strong following who writes dozens of thousand-page books a year, then this is great for you. The problem is that the model actively encourages authors to write huge tomes to get that 0.4 of a cent (that’s $0.004) per page for each original read.
Why is this a problem? Because, in a nutshell, the model pushes quantity over quality, to publish as many big, long novels as you can. Your readership who loves your universe will be happy as a clam with all this exciting new material every few weeks or months.
“Just write more books!” they say. “Work with the model and you’ll be rolling in it in a few month’s time.” Sure, except that writing more books takes more time, and as an unknown author, you can’t get in front of an audience, then it seems like a time sink for no return.
Assume it takes 4 – 5 months to write a (decent) book, while working and actually seeing your family, then you’re pushing a lot of hours. If you only sell a couple of books, then an hourly rate of less than one cent isn’t exactly inspiring.
“Amazon has this great thing called advertising, and they only charge you for clicks!” comes the next expected reply. Yes, it does, and while it is great that they only charge for clicks, it’s the amount that gets charged per click as compared to the return for Kindle Unlimited that takes its toll.
Below are the rates that you get charged for impressions by Amazon as of 26th December 2020. If someone clicks through the link that appears on their device, based on demand and bid price at the time of presentation. So if you happen to win the auction to present someone with your book and they click it through, you’ll be charged anywhere between those two figures.
Note that these figures are actually quite low compared to normal. It’s not uncommon to be charged anywhere up to $1.40 for a single click. Note that this is not a sale, this is just someone clicking through on your link to see if they want to purchase or, more likely, borrow your book from Kindle Unlimited.
For now, let’s be generous and say that it only took one click at 60c for someone to decide they want to read your book. My novella, “The Map in the Fortune Cookie,” is recorded as 58 pages for KU payment purposes. 58 pages at roughly 0.4c per page gives the princely sum of 25c in return for that 60c outlay.
Where do I sign up?
Incidentally, a sale of the book returns to me $1.99, so I would make 1.39c for each sale after advertising costs, assuming a one-click-one-sale ratio (which is in itself an extremely generous assumption). While not exactly wonderful, it’s a profit. But again, unless you are a well established, well-known author with an existing readership, most people want to see what you write like, and Kindle Unlimited lets them do that for no outlay.
Throughout the whole time I advertised my books on Amazon, I had a number of reads with KU, but not one sale. Not one. In effect, it was costing me money to let people read my book for free. And if you have your book registered under KU, then they enforce exclusivity, which means you can’t try to sell your book anywhere else on any other platform.
Now here is the kicker out of all of that. If your account is in Australia, as mine is, then Amazon won’t release your funds to you from amazon.com revenue until your total returns reach $100USD. That means, being very generous and assuming that it costs me double in advertising for each KU read, it means I have to outlay $200 to get my $100 back.
Of course, this doesn’t work in reverse. Amazon is more than happy to receive your advertising costs – and they charge that to your credit card each week. Money goes out, no money comes back until you reach their threshold.
You then, of course, get the argument “But it’s international funds, of course they’re going to wait for thresholds. Everybody does that!” Well, no, no they don’t.
My partner Benedict sells his music on the platform Bandcamp, which is a really great site for independent music artists to sell their wares. They have people from all over the world, and this is their stance:
We’re proud of the fact that when you choose to pay an artist on Bandcamp, your money reaches them quickly, and in a way that is simple to explain and understand. Our business, which was founded in 2008 and has been profitable since 2012, is based on taking a revenue share of sales. Our share is 15% on digital items, and 10% on physical goods. Payment processor fees are separate and vary depending on the size of the transaction, but for an average size purchase, amount to an additional 4-7%. The remainder, usually 80-85%, goes directly to the artist, and we pay out daily.Bandcamp website
That’s right, boys and girls, they pay their artists daily. They use Paypal to do so, which eliminates the issue with international payments. Why doesn’t Amazon do this? That’s a very good question, and one that only Amazon can answer.
The upshot of all of this is that there is little to no benefit to me as an independent author in my keeping my books available under Kindle Unlimited. I can choose not to advertise and see a nice blank line of zero sales and zero reads, or I can pay for advertising at a minimum of double the return from KU reads and not see any of that money (remember, it’s 25c a book return for “The Map in the Fortune Cookie”) until I make $100USD in revenue.
All the while, not having any capacity to sell anywhere else.
In the end, the decision becomes easy. I will continue to sell my books on Amazon, but I have cancelled my KDP Select option on both of my fiction works, which means I can also sell them directly from my website with PayPal for whatever damned price I like. I will have that set up over the next few days. I will still have advertising costs, but it’s under my terms and I might just actually get to see the money.