Amazon’s New Payment Plan Changes the Game

When Amazon announced their ‘Kindle Unlimited’ program, many authors, myself included, braced for impact. In a nutshell, Kindle Unlimited allows a user to borrow an unlimited number of Kindle eBooks in a month, with a 10-at-a-time limit, for the low price of $9.99 a month.

Amazon's new rules for paying authors when you borrow a book.Sounds great, right?

With everything, there’s a catch. But it’s not really on the reader’s side. There are over 800,000 titles in the program so there’s plenty of selection.

For a book to be part of Kindle Unlimited, it has to be a part of KDP Select (in a nutshell, the author is giving Amazon a 90-day exclusive to the eBook). But here’s the kicker… The author wasn’t getting paid for these downloads unless the reader got to 10% of the book or more.

(Before Kindle Unlimited, a book could be made available for borrow by Prime members (KOLL). But the author was paid the moment it was borrowed, regardless of how much was read.)

Oh Amazon… Forever changing the game for indie authors!

The way payment worked was simple:

  • Monthly pool of money
  • Divided by total number of borrows in that month
  • Multiplied by YOUR borrows
@Amazon still pays #authors better than other #ebook retailers. Share on X

So I can do the math, imagine a pool of $100,000. If there were a total of 100,000 copies borrowed, that figures to $1 per borrow. If your book was borrowed seven times, you make $7.

Starting July 1, 2015, they changed the rules yet again. Bowing to author pressure that authors of shorter books were actually getting paid more than authors of longer books (not sure how that worked!) Amazon has introduced something called Kindle Edition Normalized Page, KNEP.

I guess I can see how it was “unfair” under the old system that a book with 30,000 words would be paid the same as one with 100,000 words. Since most of my titles are available on multiple platforms, only a few are in KDP Select. I did it intentionally where the biggest (and thus most expensive) would be available for borrow.

KNEP is where Amazon has assigned a standard to create what is a “page” on Kindle. They’re not giving exact calculation details but they’re saying it’s fair. Now, Amazon is only paying you for the number of pages actually read when your book is borrowed through Kindle Unlimited or Amazon Prime.

At first, I was really unhappy with this. I’d been hounding my dad for MONTHS that when he gets a book through Kindle Unlimited to just flick through the 10% minimum so the author gets paid. After all, I thought, the author worked hard on that!

How #authors actually get paid when you borrow their #book through Amazon. Share on X

But as I was venting this past week, two interesting things were pointed out to me:

1. If the book is terrible, and somebody only reads a few pages and then returns it, at least the author gets paid SOMETHING. (The same would go with a book that was borrowed by mistake.)

2. With the new statistics, you can see if people are actually reading the whole book. (Amazon does tell you how many KNEP pages your book has.) Since I write non-fiction, this is really helpful to see if people were getting to a certain point and getting stuck.

The wifi on your Kindle tells Amazon how much you've read. Which helps the author get paid!The part that I really don’t think is fair, however, is that if you’re Kindle or reading device isn’t on the internet, you could read the whole book and the author would only get paid when you next connect to wifi. When I first got my Kindle, I couldn’t even LOAD books via wifi – I didn’t have the hardware and had to load manually via a cord. While that’s not me any longer, and I think MOST people load their Kindle via wifi, there has to be some people who don’t.

The pool for borrows for July is ELEVEN MILLION dollars. With all the buzz around Amazon’s Prime Day (7/15/15) offering deals better than Black Friday, I’m hoping to see some excitement in book sales or borrows all the way around.

Tell me what you think? Is the new KNEP a fairer payment method to authors? Now that you know how the system works, will you change your “reading” habits when reading a borrowed book?

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Additional reading:

Kindle Unlimited Pages Read

Kindle Owners Lending Library

And of course, you’re welcome to join Amazon Prime or Kindle Unlimited. I’ve got both.

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Kim Galloway
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