18 August 2014 by Published in: Uncategorized 18 comments

Amazon announced Kindle Unlimited last month with much fanfare, establishing a subscription model for its offerings – pay one low fee each month, read as many books as you like. You’re restricted to downloading ten at a time, though, and you have to delete one to make room for your eleventh, but hey, tomato, tomahto. The point is that you can now read whatever you like without having to pay more than $10 a month.

An awesome deal, right?

I signed up. Of course, I have no time, so it was all I could do to make it through Michael Lewis’ latest, Flash Boys, before my 30 day free trial was over (fascinating reading for anyone wondering why the markets are so broken, and who’s behind it).

For that reason, I canceled my subscription at the end of thirty days. I just don’t have the time. I have a backlog of a year’s worth of books. I’m not the target customer.

There was a SNAFU on Amazon’s side with respect to payment during that first month. Apparently the reporting dashboard was reporting all borrows, regardless of whether they were read at least 10% (the threshold for an author to be entitled to the borrow fee payment). To Amazon’s credit, instead of saying, hey, there was a glitch, you actually only are entitled to a quarter of what you thought (or whatever it is), they paid a reduced amount on all borrows, regardless of whether any of them were read or not. That was a classy move from the retailer, who could have just as easily not paid on the ones that weren’t at the 10% + read point, and been 100% in the right.

A couple of observations: Because the borrow fee looks to be somewhere in the $1.50-$2.25 range (the historical norm for Select borrows), it encourages only one sort of participation – very short works, which are hard to or impossible to sell for anywhere close to a price that will net you the amount paid for a borrow (I think of that as Amazon inefficiency arbitrage), and books that are priced in the $2.99 or under price range (for whatever reason – length, lack of popularity, whatever). Above that and you’re receiving less for a borrow than for a sale. Now, while you can argue that you are perhaps seeing borrows from folks who otherwise wouldn’t have tried your fine work, it’s impossible to know that, so I file it in the wishful thinking bin. What I do know is that there is an inverse relationship between borrows and sales. Borrows go up, sales adjust down by some amount. In my case, it’s often that the borrows cannibalized the sales at an almost 1:1 ratio. Others report different ratios, so I might just be weird, or it could be my genre, or whose shirts I wear, when I wear anything at all – and don’t judge, hatahs.

One thing I noticed as I was browsing the titles was that none of the books I have been holding off buying to read are in the program, so for me there was little value to it, even if it was only one or two books a month I could get to. Because if the ones I’m interested in aren’t in the program, then the program’s only offering me stuff I don’t much care about.

For instance, I really, really want to find the time to read I Am Pilgrim. I’ve been told by multiple people that it’s a marvelous spy thriller, right up my alley. I looked for it but it wasn’t in the program. Ditto for James Lee Burke’s latest, Wayfaring Stranger. Not in it.

These are trad pubbed titles, but my point is that I have limited time and when I get to read, I either do so for research or because it’s an author who really impresses me. A program that doesn’t give me what I’m looking for loses me.

Does that mean that the program itself is a loser? Not at all. I see the wisdom of it for voracious readers. But for authors, well, that depends. Take me as an example. The majority of my titles aren’t in the program, because to be in it requires the titles be exclusive to Amazon. Now don’t get me wrong. I have six or seven titles exclusive with them. I view that as diversification, just as I view having 23 or whatever on different platforms to be diversification as well. I want some in the program, some out, just in case the program is a windfall – I don’t want to miss out, but I don’t want to risk too much to find out, either.

To be exclusive on all my books? Makes no sense because my average novel is $5, and new releases are $6. Why would I want to accept $1.80 when a sale will pay me double to triple that, and forgo the 20% or so of my sales that are not on Amazon? See the problem? Because it requires exclusivity from me, it’s created a binary decision. Perhaps if it didn’t require exclusivity I’d be more tempted to toss a few more onto the pile, but as it is, it doesn’t make financial sense. Maybe I’m wrong – the test will be how my Amazon exclusive titles do over the next months. I’ll report back on that. So far it’s a wait and see.

What do you think? What’s been your experience? Inquiring minds want to know.



  1. Tim Stevens
    Mon 18th Aug 2014 at 5:50 pm

    Interesting to hear your take. I have a few titles in Select, but not all of them. In the first few days of the KU program, I saw borrows of my Select books rise to around 20% of my average total daily sales, without any corresponding drop in sales themselves. That lasted for about five or six days. Borrows have dropped to about half that number, but are still higher than they were before KU was introduced. However, my daily sales are now down by about 10%.

    This may represent cannibalisation, or not. Difficult to tell. I sell my books for $3.99 -4.99, less than you, so the revenue hit from borrows as opposed to sales isn’t quite as great. It’s early days yet.

    • Russell Blake  –  Mon 18th Aug 2014 at 7:15 pm

      We also have to adjust for the oddity of all borrows being reported, not only the 10% read ones. My sense is that will become obvious over the next 30 days, as participation in the program evens out to more of a steady state, and we get an accurate look at 10% borrow level. Then you can just look at your sales graph, and on days where there’s a bump in borrows, see if there’s a corresponding drop in sales. My experience has been there’s no free lunch, although I keep hoping for one. July with Amazon’s unexpected largesse was the closest we’ve come.

  2. Mon 18th Aug 2014 at 11:46 pm

    My novels are priced at $2.99. Not sure why I’ve never tried increasing them to $3.99. One of them is top 100 rated in its category for over 3 months. Maybe I should’ve experimented with that. Anyway, my bestselling title had 65% borrows for the month of July. This month my borrows are almost triple sales on that book, so it’s definitely eating into sales, but since my books are only $2.99, I’m not feeling the pain like you would.
    I didn’t sign up for Kindle Unlimited. I’m an Amazon Prime member, mainly for the free 2 day shipping. If I have time I can borrow a book from the same lending pool.
    I’ve found I don’t do that though. I tend to buy the books I want to own when on sale for 99 cents or at full price if it’s an author I really want to read.

  3. Tue 19th Aug 2014 at 12:18 am

    I diversified at precisely the wrong time (in KU terms…it’s otherwise been a smart move), and only had some shorties and an anthology in Select when it launched. I saw no movement on any of them.

    I think KU is going to be a non-starter for many of the reasons you mention, RB. For authors, it looked like an ideal place to pawn off hundreds of short stories (“hey, Mr. Reader! Remember how you wouldn’t buy my 8k word story for $.99? Now it might as well be free!”), but because there’s little best-seller draw to pull readers in to begin with, no one’s picking up ancillary shorties in a what-the-heck-I-may-as-well-try-one move.

    So, until Amazon raises that mystery payout amount to make it more palatable to writers or are able to sign some of the more attractive books/series to participate to bring in readers, it’s going to stagnate, IMHO.

  4. Tue 19th Aug 2014 at 7:51 am

    A big “meh” for me. I put 4 titles out of 8 in there. I saw sales stay the same (3k – 4k units per month), but borrows go up (by about 10 per day). That pushed the books up the ranks.

    At first.

    The first month was pretty good. Now, not so much. I’ve heard some people raking it in, but that seems to have passed me by. I released a new title straight into KU and, so far, haven’t seen it exceed the performance of my last non-KU title. So, at least for now, it seems to make sense to diversify. Certainly if you’ve got a couple series out, with book 1 free and can boost that up with Bookbub, going on multiple platforms is probably the way forward.

    For those with fewer books, or non-series books, or shorter works, maybe KU makes up for not being on other platforms. There doesn’t seem to be a blanket answer. The only trick is to keep testing, testing, testing.

  5. Tue 19th Aug 2014 at 11:00 am

    Thanks for sharing your thoughts on this. I have my books in KU and I’m seeing good uptake but nothing that I could call spectacular. I agree, long term we’ll need to wait and see. One thought, though, and one of the reasons I was keen to join KU – if the programme gets strong support from readers, indie authors should be at an advantage since most BigPub titles aren’t included. Together with the opportunity to offer preordering now, perhaps this is a sign that amazon continues to value us and provide good opportunities to market our work.

    • Russell Blake  –  Tue 19th Aug 2014 at 11:26 am

      That’s a big if, Seb, because without the titles readers most want to read, I’m not sure how much support it will get.

      Let’s face it. If all you want to do is read, and you don’t much care about quality, there are tens of thousands of free books that would take ten lifetimes to pore through. Readers have shown countless times that the marquee names are big draws. If you don’t have those names, I’m not sure how attractive it is to them. So we might have an advantage in a tiny pond. That’s nice, but it’s not proving to be any sort of sales booster for me yet. YMMV.

  6. yoon
    Tue 19th Aug 2014 at 9:12 pm

    As a voracious reader, I plan to cancel it as soon as the free trial ends. The main reason is that out of 300+ books on my wish list on amazon for which I’m waiting for the price to come down, I found only one, Flash Boys, listed in Kindle Unlimited. And frankly, why would I want to pay $10 a month to just borrow books? I can do that at my library – I can download 5 books at a time, they sync across all the devices and they are automatically removed upon expiration. Free.

    But anyways, I waited a little before starting the free trial to pick out the books I want to read first. And if one doesn’t mind spending a lot of time looking for some read-worthy books, or paying $10/month to a glorified library, it might be worth it. I found most of Micahel Lewis’ books, most of José Saramago’s books, Lord of the Rings series, etc.

    • Russell Blake  –  Tue 19th Aug 2014 at 10:13 pm

      I read Flash Boys and loved it. I especially loved the predators whining about being fed on and not understanding how they were being screwed. Answer: every part of the system is designed to screw everyone it comes into contact with. It’s not accidental. It’s been designed that way, and the regulators won’t change anything because their jobs after their stint with the SEC is with the firms doing the screwing. And people wonder why the average person’s no longer in the market. Um, could it be because everyone with a brain gets that it’s a massive con, especially after 2007-2008, when nobody went to prison for the single greatest theft in human history? Not that I have an opinion. But it’s a worthwhile read by an accomplished author. His Liar’s Poker is also mandatory reading.

  7. Frank
    Wed 20th Aug 2014 at 4:37 am

    I am Pilgrim was a bit disappointing to me. Very long and not consistent. Started as a gritty thriller about a psycho terrorist, but about half way through it turned into something like the Da Vinci Code. The guy was supposed to be a super tough spy but suddenly he was an art expert. Towards the end the action was not believable at all, especially with the terrorist becoming a joke. It’ll be interesting how they work with that in the movie.

    • Russell Blake  –  Wed 20th Aug 2014 at 12:13 pm

      That’s a shame. I’ll still give it a read, though, based on the Look Inside.

  8. Wed 20th Aug 2014 at 10:50 am

    For me, KU has been a God-send because I write within a subgenre of romance and my readers seem to really love Kindle Unlimited. I’m selling at least 10 times or more through KU than my regular sales. This month, at this pace, will be my best month ever.

    I’m locked in my home writing away day and night to keep up with the demand.

    Crossing my fingers it continues to do well. Thanks for your perspective, Russell. As usual, it’s inspiring and helpful.

    • Russell Blake  –  Wed 20th Aug 2014 at 12:12 pm

      Well, it would be helpful if we knew of that 10 times, how many actually read the book to 10%, which is the threshold this month for getting paid. Last month they reported all borrows, even those that didn’t get opened. This month they’re reporting that way, and will be stripping borrows away by the end of the month to reflect those read 10% or more, which is what we’ll be paid on this month. My hunch is it’s somewhat less than 100%.

      That said, I’m glad it is doing well for you.

      • Jamie Lake  –  Thu 28th Aug 2014 at 3:05 pm

        I just heard back from KDP. From August 1st on, the only KUs you see on your dashboard is the people that read at least 10%. So, there will be no snatching back of KU numbers, getting us all excited and taking them from us anymore. What we see there is ours to keep.

  9. Richard Fox
    Wed 20th Aug 2014 at 1:06 pm

    My KU/KOLL borrows are way up, but sales are way down.

    I don’t put much credence in the initial KU numbers, simply because Amazon gave away the first month for free to everyone. How many will cancel after the first month? I’m sure we’ll see a sharp downturn in KU numbers once the free month is over.

    KU will be great for a series of short stories I’ll put out under a pen name. If KU can consistently pay more than 35 cents a pop, than it’s a win for short story and 99 cent titles.

    • Russell Blake  –  Wed 20th Aug 2014 at 1:26 pm

      Correct. It’s a win for authors. But not so much for readers, who will quickly discern that all they’re getting are a bunch of short stories or bottom of the barrel books they wouldn’t have paid anything for under normal circumstances. Readers aren’t stupid. While I get the whole KU arbitrage thinking on shorts, there’s never a free lunch, and I don’t see Amazon handing out dollar bills for short stories for very long.

      I like the idea of the program as a reader, but its value to me is only as good as the titles in the program. Reality is that if the pay for my $6 novel is $2, it won’t be in the program, and if others with work that’s in that range determine it’s a bad deal financially (which it appears the trad pubs kind of have already), neither will theirs. Which reduces the value considerably. Ironically, the way to fix that would be to have a tiered reimbursement, like .50 for a short story or a .99 novel, $3 for a $5-$6 novel, etc. But at that point Amazon is basically just paying what we would have earned for a sale, and I’m quite sure that’s not a great deal for them, so I don’t expect it to happen, unless they can coax tons of readers who only read one or two books a month into the program.

      Nobody ever asks me about stuff like this. Phooey. I could have saved them some heavy lifting. Ah, well. They seem to be doing fine without my enlightened views…

      • Kim Cano  –  Wed 20th Aug 2014 at 9:09 pm

        That’s a great idea. Too bad they didn’t do that.

        I haven’t seen any uptick in borrows on my 99 cent short story collection even though people say KU is great for shorts.

        The book that is getting the most borrows is the one that sells the most. I also noticed it’s coming up as suggested on the first page in my category, versus my other book which comes up on the fourth page in the same category, so that’s probably helping.

  10. Thu 21st Aug 2014 at 4:38 pm

    Got a lot out of this piece, Russell, thank you. Your thinking sounds similar to mine. I prefer diversification too. At this point, while I’m planning Books 4 and 5 in my ongoing series, I’m also going to look at some 2 novella-length works that I can leverage in some different ways:

    – 1 novella that would be in KDPS and KU. I’m currently considering either $0.99 or permafree, and the work would serve as a good entry point for the series. (Like Pratchett’s Discworld, my series is non-sequential, so it’s easy to work up a story that’s a good entry point, even though there are already other works on the market). Even though this title would overall live in KDPS, looking long-term I’d probably still have, say, one time a year where I’d pull it from exclusivity, pop it up on my site and/or select other direct distributors (eg KWL), and make it available elsewhere for a wee while, then pull it and return it to KDPS.

    – 1 novella that is everywhere. (Given some of my storylines I could probably make these two novellas inter-relate, encouraging cross-sales/cross-reads, but I don’t know yet if that’s what I’ll do.) Same pricing as the KDPS exclusive title.

    Like you said, diversification is good. I’m happy to work with anyone who wants to carry my books, but I also see the value in having a title or two that also takes advantage of KDPS and KU’s exclusivities.


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