Amazon just announced that the payout for Kindle Unlimited rentals (KU’s) is only $1.33 each for October. This compares to $1.52 for September, $1.54 for August and $1.81 for July, the month the program started.

As a result of this drastic drop in payout, I’ve received a number of emails from authors I know about whether staying in Select and KU is worth it at this point. The following is an email I sent to my friend George Hudson, author of Sol Shall Rise. It pretty much lays out my thinking on KU and Amazon as a whole at this time.

“Yeah, George, KU is a problem right now, but it’s larger than that. Overall, Amazon is underperforming. Don’t get me wrong, it’s still the eight-hundred pound gorilla in the room and we need to always be on it. But looking at a combination of much lower payouts for KU, along with the declining number of rentals/borrows, I don’t see the harm right now in pursuing other venues to sell our books.

Currently (as of the 14th) I’ve had 325 KU/KOLL’s worth $432.25 in revenue…based on $1.33 per, and if the current trend in payouts continues, this number may drop, too. So the question becomes can I get more than $432.25 in sales from Smashwords, Apple, B&N and Kobo in a fourteen day period? (To be honest, I never have, and I’ve been on the others sites twice before but couldn’t find any traction there. But that was then and this is now.)

But with Amazon’s overall sales decline, I think it might be wise to try the other outlets again, and this time give it enough time to take hold. A lot of people in my writer’s group are reporting declining sales on Amazon, yet not so much on the other sites. In fact, some are reporting even a slight increase in sales, especially at Apple. So the falloff at the other sites is non-existent,  while Amazon’s is prominent and in your face.

Just looking at my own numbers, this has been the reality of KU:

July (12 days of the program) = 1,029 KU’s at $1.81 each, worth $1,862.49

August = 3,539 KU’s at $1.54 worth, $6,450.06 (including $1,000 bonus for being #94 on the KU All-Star list)

September = 2,585 KU’s at $1.52, worth $3,939.20

October = 1,341 KU’s at $1.33, worth $1,783.53

November = projected 696 KU’s at an estimated $1.33, worth $925.68 (will probably be lower than $1.33)

So from a full month maximum of $6,450.06 all the way down to $925.68 in just 4.5 months is pretty drastic. This tells me Amazon is not getting a lot of new members to sign up, and most of their existing members have already rented my books.

But even with the drop off in KU revenue, this wouldn’t be so bad as a supplement to normal Amazon sales. Yet with the overall drop in normal sales as well, this is where the concern comes in. On the whole it may not be a bad idea to start building a presence on the other sites. Dropping out of Select right now would affect me to the tune of about $1,000 per month (unfortunately, probably less if the payouts keep dropping). So my goal would be to make up that loss of revenue by diversifying my distribution.

I’m in Select until the end of December and through January for most of my books, so I will have the benefit of the holiday sales to see what happens before having to make a final decision. And even then, once out of Select you can always opt-in immediately, and then only for 90-days at a time. However, it’s such a hassle adding your inventory to the other sites and then having to pull it  if you’re jumping in and out of Select. And you can never establish a presence on the other sites by doing it this way.

If Amazon’s overall regular sales weren’t declining, I wouldn’t even be considering this move, but there’s something going on at Amazon that ‘s changing the dynamic. I’ll tough it out through the holidays and let you know how it goes.”

Tom Harris