November was the first full month that overseas customers with Amazon Prime were able to borrow a Kindle eBook from participating publishers for free. Apparently they rushed to do so, because in spite of the addition of $100,000 to the $600,000 shared pot for self publishers participating in Select for November, the average payment per borrow plummeted by 20%. Combined with the increase in the pot, that suggests that around 30% of KOLL book borrowing in November took place overseas.
The payment fell below the magic $2.00 mark, where self publishers with $2.99 Kindle titles earned more by having them borrowed than by selling them. That hadn’t happened since the first two months of existence for the Select program, which may indicate that Amazon underestimated international demand. It could also mean that the mix overseas was different, perhaps fewer trade publishers made their titles available to KOLL (Kindle Owners Lending Library), which would increase the relative share overseas for self publishers. Or perhaps a higher proportion of overseas self publishers signed up because they were already exclusive with Amazon.
I’ve never seen any data breaking down the percentage of self publishers in the US vs. the UK who are exclusive with Kindle, but intuitively, it would make sense for more UK publishers to be exclusive with Amazon since Barnes&Noble had no retail stores there to drive Nook adoption. Yes, there’s a Nook store on the web, along with Apple devices, Kobo and Sony readers, but the main eBook reader competition for Kindle in the US has been Nook.
Amazon has already announced a “holiday bonus” of $1.5 million dollars to the Select pot for the winter, an extra $700,000 in December and the rest spread over January and February. That might result in compensation for next month jumping over $4.00 per borrow, but I suspect the $5.00 per borrow I targeted a few weeks ago is by the boards.
I suppose it’s also possible that the KOLL borrows overseas will be higher in the first month or two and then fall back as people return to their normal entertainment consumption habits, as apparently happened in the US. But it could be cultural differences in some of the overseas Kindle markets will lead to a permanently lower Select share for American publishers. This will happen if readers in those countries avail themselves of their free KOLL borrow every month, unlike some American Kindle owners who join Prime for the free shipping and movies.
As always, there will be winners and losers. I’m a net loser on Select going international because my most popular titles are available in the US only. US publishers whose titles are available and equally popular overseas will break even, while those who hit a cultural sweet spot in another country or publish in multiple languages will come out ahead. Stay tuned for the week of January 15th and the December payout.
Good reporting and good analysis. Thank you.
Thom,
I suspect that you and I are the only ones who pay attention to this stuff:-)
Morris
I experimented with one of my eBooks a few weeks ago by putting it in the Select program, and the thing I’ve noticed is that it hasn’t decreased the number of normal sales it gets. So I’ve done the same with my second eBook now, figuring that I might as well capitalize on the Christmas bonus, just in case it does turn out to lead to significant KOLL payouts.
Am I alone in finding that KOLL borrows don’t negatively impact normal sales?
Also, if there is no negative impact, then is it the case that the only disadvantage of clicking that little Select checkbox is the exclusivity requirement?
Cheers
Derek
P.S. You’re wrong Morris. Lots of people are paying attention to your KOLL analyses
Beyond your posts, there’s too much ‘plausible reasoning’ and not much evidence out there.
Derek,
My own data isn’t useful for telling how Select impacted sales for two reasons, the first of which might affect your own situation. First, I rolled out in December of 2011, which is an “up” month, due to early giving of Christmas gifts, so it’s hard to say how many sales and borrows are due to seasonal and new product considerations. Second, I used the free promotional days in the first month for my books as I signed up, so there were large numbers of “sales” being counted to help visibility, this before Amazon cut the value of promotional giveaways by something like a factor of a hundred.
I don’t know the exact dates you added your books, but I do know that a whole slew of new Kindles became available in October and November. These events drive up sales, and they also drive up borrows since new Fire owners get a month of Prime for free. So I’ve never had much luck backing out comparison data from the Select program, other than the payment. It would require a quiet period, with no seasonal events or new product introductions, and A/B testing with somewhat similar books. I suppose another way to do it would be to compare month-on-month for a title with steady sales and borrows by unenrolling it from Select at the end of a 90 contract and seeing what happens the following month.
Morris
Morris,
Maybe it’s time to go back to following your own advice and not relying on behemoths like Amazon, to send you your living. I know you got hit by Panda, but maybe start some new websites.
Just broad thoughts here. I don’t trust Amazon. I too rely on them for some of my income but I try to diversify as much as is humanly possible.
I showed you a few months ago, the DRM software I purchased and use to sell my own copy protected eBooks. It costs me only $50/mo to run the software and despite people having to install a new reader on their computer and follow instructions, I have about 95% satisfaction rate among my customers.
I have to say, that $50/mo cost is so worth it. It makes me feel like I can keep being my own “mini amazon” and not rely on the behemoth.
I know these thoughts aren’t new to you. Just a reminder
Bryan
Bryan,
No, I hope to be done with the web. It’s owned by Google and Google is too dishonest an entity to include in a business model. With Amazon, you can get weird policy decisions and random responses depending on the employee. But I’ve never felt that they believe themselves to be demi-gods like the Google staffers, who can’t be bothered to communicate with mere mortals.
I don’t use DRM for two reasons. One, I’m unwilling to deal with a 5% fail rate, and two, I don’t believe it has any effect if your stuff is piracy bait. I don’t believe your demographic is interested in piracy in the way mine is.
In any case, the direct sales you generate from promoting your site in mailings, books, etc, are one thing. The eBook sales you get from Google sending search to your site don’t make you a mini-Amazon, they make you a mini-Morris waiting to get stepped on:-)
Morris
I totally get your take on the Web Morris. But my latest take is slightly different…
-Website visitors are controlled by Google, who has proved themselves to be dishonest and unpredictable.
-eBook readers are controlled largely by Amazon, who appear to be much more honest, but who knows what the future will hold.
-eMail subscribers on the other hand are controlled by *you*, the business owner. So I’ve made the latter (essentially Email Marketing) the pillar of my business now with Google and Amazon being helpful adjuncts (along with a few other smaller companies).
It’s been working so well in the last 6 months or so that I’m curious Morris why you don’t seem to be interested in that approach?
Derek
Derek,
I just never liked getting marketing e-mails myself so I’ve never sent them. I suppose I have the e-mails of a couple thousand eBook buyers, but I never used them. I never even suggested my books to people who e-mailed me questions, and I once got thousands a year of those.
I was really just a big fan of passive marketing, of putting my best work online and hoping one or two visitors in a hundred would buy the book, or later, the eBook. Now that model is a dinosaur, and I don’t really see a way forward for myself in nonfiction self publishing.
The silver lining is that I got sick of staring at computer screens years ago and with diminishing returns, it should be easier to move on.
Morris
[...] from a smaller pot (I believe it was $500,000) resulted in a $1.70 payment. Second, there’s Amazon’s recent roll-out of the Prime lending program to International Amazons, which depressed the November payment by 20% below the previous month. But that was why I assumed [...]