For A Few Self-Published Authors, Kindle Exclusivity Pays; Questions Remain

Kindle Owners' Lending Library

Since Amazon (NSDQ: AMZN) opened up the Kindle Owners’ Lending Library to self-published authors willing to sell their e-books exclusively on Kindle, the number of e-books available in the library has skyrocketed to over 75,000 titles. Each participating author is competing for a piece of a monthly fund–$500,000 in December–and the top ten made an average of $7,000 apiece last month, Amazon announced today. But for every data point the company reveals, there is another question.

The program is called KDP Select. In exchange for agreeing to sell their e-books exclusively in the Kindle Store, self-published authors can add those books to the Kindle Owners’ Lending Library, which allows Amazon Prime members who own Kindles to borrow one e-book for free each month.

When Amazon launched KDP Select at the beginning of December, some self-published authors were upset by the exclusivity requirement. In a press release that aims to assuage those concerns (and includes glowing reviews from a few participating authors–“Enrolling in KDP Select utterly transformed my career,” says one), Amazon released the following stats:

»  There are now over 75,000 titles in the Kindle Owners’ Lending Library. The KDP Select authors in that group (and they are the vast majority of the authors whose books are included) compete for a share of a monthly fund–$500,000 in December. Customers borrowed KDP Select titles 295,000 times last month. “With the $500,000 December fund, KDP authors have earned $1.70 per borrow.” (An author is only paid if his or her book is borrowed.)
»  Amazon is adding $200,000 more to the pool for January 2012, so KDP Select authors will be competing for a piece of a slightly larger pie.
»  “KDP Select authors and publishers on average are receiving an incremental 26% in December as a result of their participation in the Kindle Owners’ Lending Library.”
»  “The top ten KDP Select authors earned over $70,000 in the month of December from their participation in the Kindle Owners’ Lending Library, a 30% increase on top of the royalties they earned from their paid sales on the same titles in the same period. In total (paid sales plus their share of the loan fund), these authors saw their royalties grow an astonishing 449% month-over-month from November to December.” Amazon suggests that those authors’ paid sales grew when they joined KDP Select.
»  The press release includes earnings for four of the top-ten authors: One made $8,250 from the KDP Select fund; one made $6,200 (and is only 16 years old); one made $7,650; and one family, the Graberchuks, made $6,300 from their puzzle books.

But here’s what’s missing from the press release:

»  How many self-published authors are participating in the program? 75,000 titles doesn’t mean 75,000 authors — around 5,000 of those titles are from traditional publishers (who are not always participating voluntarily and are being paid separately, in various ways, and not from the $500,000 fund).

»  How many individual titles were borrowed? We know how many times KDP Select titles were borrowed overall — 295,000 times — but we don’t know how many of the roughly 70,000 KDP Select titles were borrowed at least once during the month. Some were clearly borrowed many times, but how many were not borrowed at all?

»  How much money did the average participating author make? The top ten are doing well, but what about the rest? How many authors made $0 from their participation (or actually lost money because, in order to participate, they had to remove their e-books from all other etailers?)

»  Also, how does the top ten break down? What did the number-one KDP Select author make from his or her participation, and what did the #10 author make?

We know how four of the authors did. The four mentioned above might be the top four, or they might not be; Amazon may be highlighting them because they are not well-known. (Some very popular self-published authors, like J.A. Konrath, are also participating in KDP Select, and I’d imagine they are also among the top-ten highest earning authors.) But we know that four authors made $28,400 combined from their books being borrowed, with six more making around $41,600 ($70,000-$28,400). That’s an average of $6,933 for each of the other six authors, but some (or one or two) may have made a lot more, and the rest proportionately less. The four authors whose earnings Amazon specifically reveals suggest that earnings were split equally between the top-ten authors, around $7,000 apiece, but that is by no means the case. We don’t know.

»  Amazon said that KDP Select authors will also receive “access to a new set of promotional tools, starting with the option to promote their enrolled titles for free for up to five days every 90 days.” Are any other new promotional tools now being offered, and if so, what are they?

»  On the topic of the Kindle Owners’ Lending Library in general, has Amazon added any more traditional publishers to the program?

I’ve asked Amazon all of these questions, and I don’t expect answers to all of them, but I hope the company will answer a few; if it does, I’ll update this post.


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