I was wrong, again.
Yesterday I posited that the Amazon forgot to add the $700,000 bonus to the reported payment for Kindle Select publishers in December. Today I looked a little closer at the numbers and concluded that Kindle Owner’s Lending Library borrowing of eBooks from self publishers in the Select program doubled from November to December, reaching nearly three quarters of a million eBooks.
So the graph I published yesterday was correct, and the payment for December, from a total pot of $1.4 million dollars, is only $1.88 per book. I’ll paste the graph in again below:
This means that publishers of books priced $2.99 and higher are losing a little (or a lot) of money when customers choose to borrow rather than buy. On the bright side, publishers almost certainly make any difference back on increased volume, since the “free” price is more attractive to potential readers than the cover price.
I’m glad I qualified my post yesterday with the caveats that an increase in the Amazon Prime base due to free trial memberships or the increase in the KOLL base through the addition of European Amazons might have been responsible for the reported drop.
Many of the new KOLL users will no doubt drop out of Prime after their free month expires, but if the increase in the KOLL user base turns out to be due to more European members, American self publishers should brace for a permanent drop in Select royalties unless Amazon puts more money into the pot.
It does strike me that Amazon’s internal money people did an excellent job predicting the increase in KOLL borrowing, and that the bonus was intended to keep the payout in the two dollar per title ballpark. It will be interesting to see what happens in January.