Tag Archives: KDP Select borrows

Jul 20 2014

How to Borrow Amazon Prime Books without Using Kindle Unlimited

Prime Reads

Borrowing with Amazon Prime

Amazon used to advertise on the book’s product page that the book could be read for free if the book was in KDP Select.

With the introduction of Kindle Unlimited, product pages no longer advertise Amazon Prime’s monthly free borrow.

Instead, they advertise Kindle Unlimited, which makes sense. Customers interested in reading free e-books are more apt to appreciate Kindle Unlimited than Amazon Prime (since they can only borrow one book per month through Prime).

However, Amazon Prime customers can still borrow one KDP Select book per month, as in previous months.

But many Prime members are confused about this.

They don’t see mention of Prime on product pages like they have in the past. So many customers are wondering if they can no longer borrow books through Prime.

The trick is to log into the Kindle device, rather than browse for books on Amazon’s website.

Here are Amazon’s instructions for how to borrow one eligible book per month through Amazon Prime: https://www.amazon.com/gp/help/customer/display.html?nodeId=200757120.

Amazon Prime is still great for free two-day shipping and for video streaming. Amazon is still advertising Amazon Prime for quick shipping of print books and other physical products.

But Kindle Unlimited is the better alternative for reading ‘free’ books. Well, they aren’t free, but once you pay the $9.99 monthly fee for Kindle Unlimited, you can read as many KDP Select books (and 100,000 others) as you’d like.

Some customers are switching from Prime to Kindle Unlimited, but some customers have both, and yet others have never had Prime but are signing up for Kindle Unlimited.

Those who are keeping Prime only: Yes, you can still borrow one book per month from KDP Select. Be sure to browse for books from your device, rather than searching on Amazon’s website.

UK and other European customers are eligible for Amazon Prime, but presently Kindle Unlimited is only available for U.S. customers.

Kindle Unlimited customers have access to 600,000 titles, whereas Prime customers have access to 500,000, so there are a few books that Kindle Unlimited customers can download, which Prime customers can’t.

Chris McMullen

Copyright © Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing
Jul 19 2014

How Much Will Authors Make w/ Kindle Unlimited?

Unlimited Reading

Read All You Want!

Now readers can, using Amazon’s new Kindle Unlimited. For $9.99 a month, customers in the United States can download and read as many Kindle Direct Publishing (KDP) Select books as they want. There are presently 600,000 titles from which to choose.

The two-million dollar question is: How much money will authors make when a customer downloads their book?

The first part of this answer is ZERO, unless the customer reads past 10% of the book. This is an important point, as many customers will think they are supporting authors they know just by downloading their books. But if they don’t read more than 10% of those books, the author won’t earn any royalty for the trouble.

What about when customers pass the 10% mark—how much will authors make then?

Well, nobody knows for sure. Amazon can’t tell us up front. Amazon is telling us how they will determine this. And we have some data to judge by, such as prior experience with Amazon Prime borrows.

Update: The results are in now. Kindle Unlimited paid $1.81 per borrow/download in July, 2014, much higher than I was expecting.

Amazon Prime Borrows

Let’s take Amazon Prime as a starting point:

  • Historically, KDP Select authors have received about $2 per borrow.
  • The first month of KDP Select was closer to $1.50, and the same for the following holiday season. Amazon created a lot of buzz for Amazon Prime and KDP Select for the first two holiday seasons, and as a result there were more downloads than usual.
  • However, when the per-borrow royalty was low, Amazon increased the KDP Select Global Fund for other months to bring the per-borrow royalty above $2.
  • Thus, for most months, authors have received $2 and change for KDP Select borrows in the Amazon Prime program.

Extrapolating to Kindle Unlimited

Based on this, here is what I expect with Kindle Unlimited:

  • The first month or two of Kindle Unlimited will feature an incredible number of downloads. There will be many new memberships. Customers will be exploring the program. They will want to get their money’s worth. Authors will be helping to promote the program, hoping to get their share of the $2,000,000 KDP Select Global Fund.
  • Thus, I won’t be surprised if, for the first month or two, the per-download royalty is significantly lower than the $2 per-borrow royalty KDP Select authors are accustomed to with Amazon Prime.
  • However, it’s in Amazon’s interest to monitor this closely. If it looks like the per-download royalty will be too low, Amazon may add additional money to the KDP Select Global Fund. Otherwise, many authors may opt out of the program at their earliest opportunity. (Current KDP Select authors can opt out immediately, regardless of when their current 90-day enrollment period ends. Go to your KDP bookshelf, click Learn More, then Learn More again to find a form specifically for this purpose.)
  • So I will be surprised if the per-download royalty gets too low (whatever that may be). Maybe it will be somewhat low the first month, but, if so, I suspect that Amazon would greatly increase the KDP Select Global Fund, trying to reassure authors that it will be much higher in the future. Time will tell.
  • Keep in mind that Amazon has already added $800,000 to the KDP Select Global Fund for July, 2014. This will help to compensate for the additional downloads coming through the new Kindle Unlimited program. The big question is: Will it be enough? My feeling is: Probably not enough to reach $2 per book, but the overall royalties could be higher than usual, depending. (In a moment, we’ll get into the math.)
  • I think it was wise of Amazon to introduce Kindle Unlimited about halfway through July. This first month will be limited in downloads, as half the month was already gone when this began. It also gives Amazon some valuable data to help project the KDP Select Global Fund for August.
  • There is another big difference. With Amazon Prime, customers can only borrow one book per month. Now, with Kindle Unlimited, each customer will be downloading multiple books per month. This will have a profound influence on the total number of downloads.

Kindle Unlimited Math

Now we’ll have some fun with numbers. 🙂

First off, the July, 2014 KDP Select Global Fund was originally $1.2 million. Amazon added $800,000 to the fund to make it $2,000,000. There will be many more downloads through Kindle Unlimited than there have ever been borrows through KDP Select, but the global fund is also larger, which helps to compensate to some extent.

Here is how Amazon will figure the per-borrow (or per-download) royalty:

Borrow Royalty

Note that borrows (through Prime) and downloads (through Kindle Unlimited) are treated equally, so we can use these words interchangeably in the math.

Note also that what I’m calling a ‘download’ is really a download where the customer reads more than 10% of the book. If the customer doesn’t reach 10%, that doesn’t qualify.

Example: The KDP Select Global Fund for July, 2014 is $2,000,000. If there are 1,000,000 downloads in July (including both Kindle Unlimited downloads and Amazon Prime borrows), then the per-download royalty will be $2.00. But if there are 4,000,000 downloads in July, the per-download royalty will be 50 cents (unless Amazon chooses to increase the global fund as a result of more downloads than anticipated).

Amazon is receiving $9.99 per customer per month through Kindle Unlimited. Each additional member provides $10 more that Amazon could use, potentially, to increase the KDP Select Global Fund. So if Kindle Unlimited turns out to be incredibly popular among buyers, all these customers will be providing additional revenue, and Amazon could choose to share some of that revenue with the global fund. If the per-download royalty is too low, many authors will be thinking about opting out. Amazon has good incentive to make the per-download enticing to authors, and Amazon knows that authors are used to making about $2 per borrow through KDP Select.

On the other hand, if an author receives many more downloads than usual, the per-download royalty could be somewhat lower than the traditional $2 and the author could still be earning more royalties overall. Amazon may consider this, so it’s possible for the per-download royalty to be significantly less than $2. Amazon may choose to look at the cumulative royalties that the average KDP Select author is earning, rather than what the per-download royalty is.

Many authors would be okay with having more readers, but making a smaller royalty per book, especially if the overall royalties are greater than normal.

Another important figure is what Amazon is making. Amazon is charging $9.99 per month per customer. The following equation will be highly important to Amazon, and so it will also impact authors:

Selling Price

Again, by ‘download,’ I mean a download where the customer reads more than 10% of the book. Amazon only pays a royalty through Kindle Unlimited when the customer passes the 10% mark.

Example: If the average customer downloads 4 books per month through Kindle Unlimited, Amazon is essentially charging $2.50 per book. In this case, Amazon could afford to pay authors $2 per download and still make a profit of 50 cents per download. But if the average customer downloads 20 books per month, Amazon is effectively charging just 50 cents per book. Amazon isn’t likely to pay authors $2 per download, while only receiving 50 cents per book; they would be losing money.

Amazon might be willing to suffer a short-term loss for long-term gain. But my feeling is, the greater the average number of downloads by customers, the less money authors will make per download.

But at the same time, the greater the average number of downloads by customers, the more each author’s book is likely to be downloaded. It works both ways.

It Really Comes Down to Percentages

More downloads means Amazon will likely pay less money per download.

But more downloads also means that most authors will have more customers than normal.

These two effects will compensate somewhat.

What really matters to an author is each book’s percentage of downloads:

Percentage 2

Remember, the download only counts when the reader gets beyond 10% of the content.

Example: Suppose there are 1,000,000 downloads in the month of July (including Amazon Prime borrows), and suppose your book is downloaded 50 times. Then you would get 0.005% of the July global fund. Since the July, 2014 global fund is presently set at $2,000,000, this book would earn a total royalty of $100 for downloads for the month. (Note that this agrees with a $2.00 per-download royalty.)

Update: The results are in now. Kindle Unlimited paid $1.81 per borrow/download in July, 2014, much higher than I was expecting.

Good for Indie Authors?

Looking at this from the perspective of percentages, this may be good for indie authors who are enrolled in KDP Select.

Probably not all indie authors, but many may benefit from this.

Kindle Unlimited customers may be more willing to try an indie book, since it won’t cost extra money to do so. The $9.99 monthly fee has already been paid, so if the book doesn’t turn out to suit the reader, the customer can easily find another book.

Through Amazon Prime, customers could only borrow one book per month, so they had to choose wisely. Many have favored a book with a higher list price and more pages, and an author they were already familiar with.

Now Kindle Unlimited customers don’t need to choose just one book. This could be a game-changer for some indie authors.

What About Good, Old-Fashioned Sales?

The more customers who join Kindle Unlimited, the fewer customers will be buying books the old-fashioned way.

Once a customer invests $9.99 for monthly reading, the customer may feel less inclined to spend additional money on books that aren’t in the program. Why do that when you can choose from 600,000 books without spending an extra penny? Kindle Unlimited subscribers may occasionally buy a book that’s not in the program, but it will take a compelling reason.

Thus, as more customers join Kindle Unlimited, authors may be receiving more of their revenue through downloads and less revenue through good, old-fashioned purchases. If so, the numbers may compensate. Kindle Unlimited could potentially make up for any lack of sales and then some. The only way to know for sure will be to wait and see.

The number of traditional sales might not even diminish. First, not everyone will join Kindle Unlimited. $120 per year is more than many readers want to commit to for reading.

Also, if Kindle Unlimited succeeds in getting a book more downloads, this may actually lead to improved sales, too. There is such a thing as word-of-mouth publicity. More readers, even with lower royalties, sometimes leads to greater success in the long run. The potential is there.

Another consideration is list price. A higher list price may actually make the book more enticing to Kindle Unlimited, and downloads through Kindle Unlimited will improve the sales rank. This might lead to more ‘sales’ at a higher list price, earning a higher royalty than usual.

It will sure be interesting to see how Kindle Unlimited turns out.

Chris McMullen

Copyright © 2014 Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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Jul 18 2014

Kindle Unlimited—Good or Bad for Authors?

Read Me

Read Unlimited Kindle E-books

Today, Amazon introduced Kindle Unlimited:

  • For $9.99 per month, a customer can now read (and listen to) an unlimited number of Kindle e-books.
  • There are 600,000 books to choose from. The books are enrolled in KDP Select.
  • All KDP Select books are automatically included. (But authors can opt out of KDP Select by completing a form. See below.)
  • Customers don’t need to be in Amazon Prime to enjoy the benefits of Kindle Unlimited.

You can read more about it at Amazon, including the terms of use: https://www.amazon.com/gp/help/customer/display.html/ref=hp_left_v4_sib?ie=UTF8&nodeId=201550610.

Authors can learn more about it at Kindle Direct Publishing (KDP), where there is also a new form for those who wish to opt out of KDP Select: https://kdp.amazon.com/help?topicId=AA9BSAGNO1YJH.

Is Kindle Unlimited Good for Authors?

In order to participate in Kindle Unlimited, an e-book must be enrolled in KDP Select.

Here are some advantages of enrolling in KDP Select:

  • You will be paid the equivalent of one ‘borrow’ when a customer (A) downloads your Kindle e-book and (B) reads past 10% of the e-book as part of the Kindle Unlimited Program. Historically, a borrow has equated to approximately a $2 royalty.
  • Many customers will be trying out Kindle Unlimited in the coming months. These customers probably won’t be buying books any other way except through Kindle Unlimited for as long as they remain in the program.
  • You can use either Kindle Countdown Deals or free promos (but not both) as a promotional tool. The value of these promotional tools will probably be diminished as any customer who has Kindle Unlimited won’t gain anything from Countdown Deals or freebies. However, there will still be many customers who aren’t in Kindle Unlimited.

The main disadvantage of enrolling in KDP Select is that you must make the e-book edition of your book exclusive to Kindle:

  • Your e-book can’t be published through Nook, Kobo, Smashwords, your own website in PDF, or anywhere else in electronic format as long as your book is enrolled in KDP Select. Amazon is very strict about this and does automatic checks to find e-books violating the terms and conditions.
  • This exclusivity persists for 90-day periods. If you decide to opt out of KDP Select, you must go to your KDP bookshelf and uncheck the box for automatic renewal. Then you must still wait for the 90-day period to end before you’re eligible to publish your e-book elsewhere. (But if you’re presently in KDP Select, there is an immediate opt-out option available right now. See below.)

Is it worth enrolling in KDP Select? That’s the million-dollar question. This was a heated debate prior to Kindle Unlimited.

The only way to really know for sure is to try it both ways. (Note that you can experience lengthy delays and problems trying to unpublish your e-book from other retailers in order to switch back into KDP Select.)

Kindle Unlimited may be a compelling reason to enroll in KDP Select. There will be many authors returning to KDP Select to try it out. There are also authors opting out with the introduction of KDP Select. Everyone is trying to decide which side of the fence has the greener grass. By the way, I’m staying in KDP Select.

  • Many customers will be trying out Kindle Unlimited, so the program will be popular during the early months.
  • Customers in Kindle Unlimited won’t be buying any books that aren’t in the program.

Want out of KDP Select?

Suppose you’re already in KDP Select and you’re thinking, “They didn’t ask me if I wanted to participate in Kindle Unlimited.”

Not a problem. Visit your KDP bookshelf. Click the Learn More link where it mentions Kindle Unlimited. Then there is yet another Learn More link to click. Then you can click the link entitled, “Complete this Contact Us form.”

Complete that form to opt out immediately. You don’t need to wait until your 90-day period ends, but only if you complete and submit this form (so don’t use the usual method of unchecking the box for automatic renewal).

You might want to consider this choice carefully before you opt out.

What about Amazon Prime?

Amazon Prime charges a hefty annual fee (though it turns out to be a little cheaper than 12 months of Kindle Unlimited) and only allows one borrow per month.

Kindle Unlimited costs $9.99 per month, but allows unlimited reading of KDP Select titles.

That one borrow per month pales in comparison. However, there are still many other benefits of Amazon Prime, such as free 2-day shipping.

Customers who bought Amazon Prime primarily to borrow books for free are likely to switch to Kindle Unlimited when their Prime memberships run out.

Customers who bought Amazon Prime for other reasons will probably keep it, whether or not they join Kindle Unlimited.

More Notes about Kindle Unlimited

  • How many books can you really read in a month? That comes out to $120 per year. Would you spend that much in a year on books? $9.99 is a great deal for those who read avidly, but not very enticing for those who don’t.
  • You can’t just horde books. If you cancel your Kindle Unlimited membership, you automatically lose access to all the books you downloaded through the program.
  • Amazon has added $800,000 to the Kindle Owners’ Lending Library (KOLL) fund for July, 2014, bringing the total July fund up to $2,000,000. This will help to compensate for the additional downloads through Kindle Unlimited.
  • Borrows usually pay a little over $2 each per month. When Amazon launches a new program, borrows usually pay $1.50 or less per book for the first month or so, but then Amazon has historically been pretty good at adjusting the KOLL fund so that they pay $2 or more per borrow. However, there will be many more downloads through Kindle Unlimited than there ever were borrows through Amazon Prime, so borrows might pay significantly less than normal, at least in the early months.
  • Kindle Unlimited is presently only available to US customers, but there appear to be plans to expand.
  • You won’t receive any payment for downloads through Kindle Unlimited until a customer passes the 10% mark. Just downloading your book isn’t sufficient. So your friends and family, for example, might think they’re supporting you through the download, whereas they won’t be supporting you at all if they don’t pass the 10% point.
  • Unlike Amazon Prime, you don’t have to return your book before you can start reading another one. However, the terms of use do include a paragraph entitled Restrictions, where Amazon will clearly monitor abuse of the download privilege. Customers must not only download the e-book, but must also pass the 10% point before the book will receive a royalty from the KDP Select Global Fund.
  • Amazon is promoting Audible Audiobooks through Kindle Unlimited. Not only do you get free downloads of KDP Select books, you also get free audiobooks. This will entice audiobook customers to try out Kindle Unlimited.
  • What about those really short books? Now customers can read short books for free (but they can read long books for fee, too), provided the books are in KDP Select and they customer has Kindle Unlimited. A customer might read 2 paragraphs of a very short story and that author will earn just as much of a royalty as if a customer read several chapters of an epic fantasy or perhaps a whole book of an omnibus. But will customers be buying short stories? They might feel it’s a better value to shop for books that are ordinarily priced $5.99 and up and have hundreds of thousands of words. Time will tell.
  • This may be great for children’s books. You can read your child 30 different stories in a month for $9.99, reading one bedtime story every night. Children’s authors should be advertising this benefit to customers. It can help children’s authors sell more e-books through Kindle Unlimited.

What do you think about Kindle Unlimited?

Chris McMullen

Copyright © 2014 Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

  • Volume 1 on formatting and publishing
  • Volume 2 on marketability and marketing

Follow me at WordPress, find my author page on Facebook, or connect with me through Twitter.

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Mar 14 2014

Amazon Prime Price Increase: Will it Affect Authors?

Change

Price Increase

The price for Amazon Prime is increasing from $79 to $99 per year.

Here is a link to Amazon’s website with information about this price change:

http://www.amazon.com/gp/help/customer/display.html/ref=hp_left_v4_sib?ie=UTF8&nodeId=201482600

How will this impact authors?

If Prime memberships decline, this may impact authors a couple of different ways:

  • Fewer sales of print books. For one, Prime customers qualify for free two-day shipping of eligible products. Prime customers may be more impulsive shoppers because (1) they don’t have to spend $35 to qualify for free shipping and (2) making more purchases than they would otherwise may help them feel like they’re getting their money’s worth.
  • Fewer borrows of e-books. Prime members who own Kindle devices can borrow up to one Kindle e-book per month. Authors enrolled in KDP Select earn royalties on borrows. But don’t worry too much: If there are fewer borrows, then each borrow will pay a somewhat larger royalty. If the number of borrows does drop, the effect may be negligible (unless Amazon reduces the monthly fund for borrows).

Hidden Surprise?

Suppose the extra $20 does deter some customers from keeping or joining Amazon Prime. It’s possible that Amazon will roll out some new Prime benefit to attract new customers. Presently, Prime benefits include free two-day shipping on eligible products, borrowing one KDP Select e-book per month, and instant streaming of a wide selection of videos. Perhaps something new is on the horizon. If so, that would help to attract new Prime members.

Is Prime Worth the Money?

There was a great article on this issue on Yahoo News recently:

http://finance.yahoo.com/news/amazon-prime-price-hike–worth-it-221620738.html?vp=1

If you’re thinking about signing up, you can sign up for a free trial by March 20 and lock in the current rate of $79.

If you’re a current Prime member who has recently renewed, you don’t have to worry about paying $99 until it renews again. If, for example, you signed up in January, the price change won’t impact you as a customer until January, 2015.

Did you know that you can share your Prime membership with family members living in the same household? Here’s how:

http://www.amazon.com/gp/help/customer/display.html/ref=hp_left_v4_sib?ie=UTF8&nodeId=200444180

Publishing Resources

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Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers

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