Kindle Unlimited has got off to a strong start and Amazon will now pay out on any ebook downloaded during July 2014, whether it has reached the 10% read mark or not, and has added $500,000 to the $2 million KDP Select fund it set for July, plus an extra $285,000 for bonus payments.
Amazon says due to this early surge in demand, it is adding a KU launch bonus of $500,000 to the KDP Select global fund for July to take the total cash paid on borrows for the month to $2.5 million, over double the size of payments in June.
Since the KU ebook subscription service launched in mid-July, Amazon data reports for authors/publishers have been showing KOLL (Kindle Owners Lending Library) downloads plus all KU books *opened*, instead of books read to 10%, which is the point that is needed to trigger a royalty payout.
July payout will include all borrows, even if they haven’t hit 10% read mark
Amazon admits this system has caused some confusion and is changing the process to backfill its reporting to reflect borrows as – KOLL downloads + KU books read to 10%.
However, for July, Amazon has decided to pay out on all KU books downloaded and opened in July, even those not read past 10%. To support this, it will add another $285,000 in July payments, making the funds being paid to authors in July $2,785,000.
The July payment report for authors/publishers shows your total earnings, including the additional funds paid during July for books opened and borrowed but not read to 10%.
The price paid out per borrow for July appears to be around $1.80, which is well down (by 20%) on the $2.25 payout in June. If your book is priced at $1.99 (35% royalty = $0.70, you’d be making $1.10 on a borrow) but if you have a book priced at $2.99 (70% royalty = $2.10), you’d be losing $0.30, although probably doing more business. For higher-priced books, you’d obviously be losing out more.
There is a divide in the KU publishing market as Amazon is reported to be paying the traditional publishers who have signed up or KU 60% of the list price while paying out self-published authors a share of the KDP Select fund. It’s not clear at all whether the royalties paid to trad publishers on KU deals comes out of the KDP Select fund or just as a general Amazon payment.
Self-published authors who want to be part of KU also have to be enrolled in KDP Select, which means they have to make their books exclusive to Amazon, while trad publishers do not have to sign up for KDP Select.
KDP reports being updated for KOLL and KU
Next week, Amazon is updating all other KDP reporting for July and August to show KOLL downloads plus Kindle Unlimited borrows that have been read past 10%.
Even after all other reports are backfilled, your July Prior Month Royalty report will remain showing all KOLL downloads plus all Kindle Unlimited borrows that were opened in July, including those not read to 10%.
All future reports, including future Prior Month Royalty reports, will reflect KOLL downloads plus KU borrows read past 10%. If a book was opened but not read to 10% in July but does pass 10% after July, you will get credit for the borrow when that happens.
For August, authors will be paid for KOLL borrows on download and Kindle Unlimited borrows read past 10%. The KDP Select Fund for August has been set at $2 million.
The early figures for KU have been very promising but are obviously boosted by a rush of people testing out the service on the free first month deal, so it will be at least three months before a clearer picture emerges. But many authors have seen big rises in borrows, with some reporting that for every 100 books they are selling, they are also seeing 80 borrows – a huge leap from previous business in the single figures, although, of course, the KOLL service only allowed one borrow a month while KU allows up a total of 10 borrows overall at any one time.
Kindle Unlimited is available only in the US at present and costs $9.99 a month.