The new Amazon KU payout program. How much will you win (or lose)?

Now that we have some more info about the new KU payout program, I decided to write a follow up on my previous post, to see where I was right and where I was wrong.

In a recent message, Amazon announced that the fund in June 2015 will be at least  11 M$. Notice the “at least”. Because it hasn’t been uncommon in the previous months that Amazon raises the fund on the last moment by 30% or 40%. However, given the predicted KU fund it is unlikely that it will be much bigger (or less) than this figure.

I predicted $11,7 mln, so that one was pretty close. And we’re not at $700.000 close, are we ? :)

Furthermore, Amazon announced a total of 1.9 billion pages read as part of the KU/KOLL borrow program in June. This means that the payout per “page read” would have been 11 mln / 1.9 billion = $0.00578 if the new KU payout program would have been applied in July. If we round it of we get to 0,6 cts per page.

My prediction, which I thought was pessimistic, was somewhere between 0,9cts and 2.5 cts. Here is that table again.

 KU analysis V2

The green area is where I thought the payout would be. The orange area is where we are ending up. This means that the average nr of pages per book is much higher than the 100-200 pages I guestimated. We’re closer to the 400 pages.

The next table seems to confirm that. With a comparable KU payout of $1.4 (if the old program would have continued), and an average page count of 400 pages, we get into the 0,4-0,6cts per page.

KU analysis V2

Amazon introduced the KENPC. This is the “normalized” page that will be taken into account for the number of pages read by your borrow customers. No further detail has been given about this KENPC, but with some reverse engineering we can find what a KENPC looks like.

To start with, I analyzed my own books.

KU analysis V2

This table probably needs some explanation. The first thing is the rather confusing discussion about “What is a page”? So let me try to explain.

Often, when an author talks about his book, and he says “I have written a 400 page book”, what he refers to is the page count that appears on the bottom of his screen when he is writing his book with MS Word. Obviously, this page count may differ considerably between authors depending on the page size used, the font, point size etc. For example, when I hammer in my books, I use the standard European A4 format instead of the US format or a 6X9” format. In the rest of this article I will refer to this number as “Author pages”. (third column in the above table).

When you submit your book to Amazon a “print length” will show up on the detail page of your book. This number is calculated as follows : if your book also has a printed version (created on createspace), it’s the number of printed pages of your printed book, that will appear on your book detail page. If your book does NOT have a printed version, Amazon will estimate what the number of pages would be, if it was printed. For this, they will use a 6×9” 11 pt layout (I have no further details, like font, line spacing , etc. about this).

This is the number that appears in my table in column 2.

Next, we have the KENPC pages, which was recently introduced by Amazon. You can find this number for every book, by going to your bookshelf, click on the book and click on the TAB ‘KDP select’. This is in my table in column 5. The fourth column shows the number of pages as they appear on CreateSpace. Notice that books 7 and 8 don’t have a printed version.

For my printed books, they are all printed as 6×9”, Book Antiqua, 11pt.

This explains that the number of CS pages is, on a couple of pages close, similar to the print length on the detail page.

But how is the KENPC calculated? Because as you can see in my table , the KENPC is NOT the same as the “print length” on your detail page. So what can explain the difference between the “print length” and the KENPC pages? In my case, the difference is varying from -10% to +26% with an average of +11%.

All my books are printed with the same font, size , line spacing etc. So one might have expected that the difference between the “print length” and the KENPC pages ,in percentage, would be roughly the same. But they aren’t. Another criteria might be images. So I included an image count for all my books. But even that doesn’t give a clear indication. For example, my book 2 and book 3 both have 58 images. But one gains 4% KENPC and the other one loses 10%. I haven’t gone any further by analyzing the size of these images, but maybe the answer is somewhere in there. But overall, my books have only 11% more KENPC pages than their printed version. Which makes me conclude that the point size for a KENPC is probably an 11pt font, which seems to be also an industry standard.

Actually, when I started publishing my books in printed format, I looked up what the ‘most common’ practices where for paperbacks. And that was 6×9” 11pt. And then there are about a handful of  common fonts for print books.

Now how come that certain authors report 70%, 80% or even 100% more KENPC pages than their printed version? The reason is simple. They ‘crammed’ more characters on a page than the KENPC standard that Amazon is using. For example, an author that has published his book in 10 pt, with a small font, single line spacing, in 8×10”, will see a considerable increase in his KENPC pages compared with his printed book. And in the same way, an author who  has published his book in 5×8”, 14pt, 1.5 line spacing will see his KENPC count much lower than his printed pages.

 How many words are there on a KENPC page? On my own books it’s about 180 words per page. But I screened a couple of forums and this figure seems to vary from author to author from about 170 up to 240.  This is a rather big difference. What could explain those big differences? It cannot be the font, size, spacing or whatever, because those are set at the same “standard” size. And if we talk about novels only, there are no images, so that cannot explain it either. The only thing that may create a considerable difference between the two novels could be… the number of page breaks. Let’s compare two authors. One has written one 300 page story. And let’s assume that it gets exactly 300 KENPC pages and it also comes out at 300 printed pages. The second author has written 150 short stories, each one filling up just about more than one page. And every story starts on a new page, which makes sense.  His printed book is also 300 pages. But given that about half of the book is blank, his word count per page is also about half  the word count per page of the other author. Notice that in this example, both would earn the same because their KENPC pages would be the same. But this explains why the word count per page can vary considerably. But given the different figures I saw, it seems that most books turn around the 200 words per page, plus or minus 25.  So if we take 200 as a reasonable average, we can conclude that an ‘Amazon KENPC standardized novel’ has 20k words for a 100-pager. And 100k words would turn out as a 500 pager.

Who will be the winners and losers? In my previous post I already predicted that only the authors of long books would be winners, as compared with the previous KU payout system. All the others will lose. Now that wasn’t too difficult to predict. The only thing that we didn’t know at what page count you would belong to the winners or the losers. I guestimated that the break even point was around 100 pages. But now that the payout per page is much lower than I expected, the breakeven point gets to 233 pages. So if your book has less than 233 KENPC pages, you will lose out as compared with the old KU system. Assuming that all borrows will be read for 100%. And if we use the 200 words per page count this means that your book should have somewhere around 46k words or more, to belong to the winners.

Is this new system fair? With this new system, Amazon has decided to ‘pay for entertainment time’. The longer you can keep a reader busy, the more you get paid. Which isn’t unfair. Especially for novels where the major purpose is, to entertain your readers.  But it’s only one of the criteria that is taken into account. For non-fiction writers, the objective is  not entertainment time, but value. Or at least, that’s what I consider what it should be. An author who explains without the fluff in a 50 pager how to stop smoking, may bring great value to his readers. Actually, they might be more satisfied with this 50 pager, then the 100 pager from another author that contains the same information but who has filled it up with 50% fluff. Which will normally show in reviews. So in this case, the author of the 100 pager would get paid 2 times more than the 50 pager, although the performance of the second one is considerable better . He explained the same problem (and the solution) in half the space. For the non-fiction writer, his ideal objective should be : write the most informational book in the least number of words without the fluff. And this is actually counterproductive with this new KY payout system. But everyone should decide for himself what his first objectives are. For me, it is writing books that are valued by my readers. The overall review rate is close to 5 on my books and I like to keep it that way. They are to the point, with facts and figures, without the fluff. And I won’t change anything in the future to make a couple of cents more with unnecessary fluff.

But for the moment, Amazon has decided to not take into account ‘value’ and reviews. And I can understand why. Because how do you measure value? And how should they take into account reviews, knowing that the whole review system is pretty open for all kinds of scams.

To resume, and although I belong to the losers (as the far majority), I still think that this system is better than what we had before, where the author of 50 pages of crap would get paid the same as the author that wrote a great 500 page novel. And maybe in the future, Amazon will somehow tune their system, taking into account value and/or reviews.

How much will you win/lose as compared with the old KU system? To calculate this, you would have to know how much your borrows weigh in your total revenues. I did this calculation for my own books. And as you can see, my borrow revenue makes up about 42% of the total . Had I taken into account my CreateSpace revenues it would have been less. On average, I will lose 52% of my KU revenues, which turns out as 21% of my total book revenues. And if I had taken into account my CS revenue, it would have been somewhere around 15%. Not nice, but not a catastrophe either. And because I have multiple streams of revenues, other than my books, on the total of revenues it’s only a snippet. Which proves again that you shouldn’t put all your eggs in the same basket. .  Of course I cannot give an estimation for you who is reading this, because this depends a lot on your own personal data and situation.

How good are your books? Now that we get paid per page read, we can also get an idea how good our books are. Because the calculation is simple. Divide your number of pages read for every book, by the number of borrows (multiplied by the KENPC), and you have your % read. The only small problem is, that from 1st of July, in our reports from Amazon, we only get pages read and not the number of borrows anymore. But… you still have that data from the past. Now this will only be valid if

  1. You have at least 4-6 months of KU data
  2. Your borrows have been significant every month. I would say at least 50-100 per book.
  3. Your borrows have been rather steady over the past couple of months.

In this case, your average borrows over the past couple of months is a good indicator of the number of borrows in future months. As for the pages read, you should have some patience. Because your pages read (and their payout) will be smeared out over several days if not weeks. Which means that this calculation of your satisfaction rate, will only approach a more or less viable number after about 2 months of KU data. Which means that mid-November you can maybe draw some conclusions about your percentage read per book.

If you’re one of the losers, what can you do about it? The answer is simple : write more in a shorter time and increase your ‘customer entertainment’ time per borrow. For the non-fiction writers : publish more (good) books in a shorter timeframe. Or for those that want to take the easy way out: add fluff and BS to your books :(

Will there be a massive exodus from KDP? Now that certain books will get paid $0,10, $0,20 or $0,50 per borrow, will there be a massive departure from KDP? I don’t think so. But there may be a major shift. The low paid books may give it a try on other platforms and therefore leave KDP. Which is not a bad thing. And good authors that were not in KDP because they didn’t consider the payout decent, might be tempted to step in, now that their 500 pager will make a nice royalty on a borrow.

Let’s see how all this pans out mid August when we have the data available for the full month of July.

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One Response to The new Amazon KU payout program. How much will you win (or lose)?

  1. Linnea says:

    Thank you for the post, very interesting. I have a couple of considerations though. Everybody says that longer books will eventually win and will get paid more, and I do hope the same. Having said that, even small books in the past were borrowed under the KU system. The result will be less payment for those, hoping for an exodus. What I fear most though is that small books (even the 20 pages “rubbish”) were borrowed. The effort to write a 20 page book is nothing compared to write a full novel. Although the revenue is small, another thing might happen: a flood of 20 pages books, authors with 200 books made of 20 pages. After all is much easier to engage a reader on the underground with 20 pages, than with a big book. People also read from their tablets and from the phone, we are in a society where we require “fast” thing. People were reading those books previously, why they should stop? Only the market will answer, but I fear we changed everything just to change nothing.
    Very interesting article BTW
    Take care

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