Will Best wonders if I’ve changed my mind:
I was interested if VD has changed his opinion on Kindle Unlimited since his July post? The NYT via drudge seemed to put it in a pretty negative light, and its concern as it relates to distorting story length does seem legitimate.
Well, I suppose I should find out what my opinion was back in July, as I don’t rightly recall the details. Let’s see, I wrote:
- My initial impression is that this is excellent for serious readers.
- Casual readers, book collectors, and fans of particular authors aren’t likely to be too fussed about it.
- It is horrific for the Big Five publishers and their writers, as their unwillingness to participate indicates.
- It’s neutral to modestly positive for independent publishers, their writers, and self-publishers.
Now let’s compare it to the New York Times story:
- It may bring in readers, but the writers say they earn less.
- The author H.M. Ward says she left Amazon’s Kindle Unlimited program after two months when her income dropped 75 percent.
- “Your rabid romance reader who was buying $100 worth of books a week and
funneling $5,200 into Amazon per year is now generating less than $120 a
year,” she said.
usually gives self-published writers 70 percent of what a book earns,
which means a novel selling for $4.99 yields $3.50…. But
Kindle Unlimited is less generous, paying a fluctuating amount. In
July, the fee for a digital “borrow” was $1.80. It fell to $1.33 in
October before rebounding slightly to $1.39 in November.
It appears I was correct about the first three points and wrong about the last one. I wasn’t aware of the relevant math, but it is entirely clear that $120 < $5,200 and $1.33 < $3.50. The math doesn’t work for the writer. I don’t see how the math works for Amazon either.
I have to confess that Kindle Unlimited hasn’t really been on my radar because Castalia House withdrew nearly all of our books from the Kindle Select program in order to be able to sell them from the Castalia House store. We never considered Kindle Unlimited at all. So, besides that initial post, I haven’t given it any thought. But the more I look at the math, the more I wonder if Amazon hasn’t made a serious mistake here based on the false assumption that every author has to be on Amazon. It looks to me like a classic corporate overplaying of a strong hand.
Everyone wanted to be on Amazon because that has been where they were able to earn the most money. But already, both we, and perhaps more importantly, our associates, are seeing that Castalia can sell between 10 percent and 20 percent of Amazon’s sales of a newly released book. And since the author makes more money on each Castalia sale, that’s the equivalent of up to 28 percent of the revenue derived from Amazon. The math still favored Amazon, obviously, but if one then reduces the Amazon revenue by 62 percent, suddenly the total Amazon revenue is only 35 percent more even when the unit sales are 400 percent higher. This means that with Kindle Unlimited, Amazon is rendering themselves considerably less relevant to writers, which strikes me as a counterproductive long term strategy.
So, my revised conclusion is that Kindle Unlimited is likely to prove massively unpopular among successful self-published writers, of no interest to independent publishers and their writers, and off-limits to mainstream published writers. Barring significant changes, I wouldn’t be surprised if Amazon ended up discontinuing it within two or three years. If they don’t, Kindle Unlimited will likely become a digital books ghetto filled with little more than romance, porn, and conspiracy theory written by unknown authors who can’t draw interest from independent publishers.
The only writers to whom I think it might be useful are those new writers who don’t have an audience and simply want to throw stuff out there in the hopes that one will find them. But even there, you’re probably better off going with Select than with Unlimited.