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Amazon’s KDP Briefly Offered a 50% Royalty Rate, and No One Knows What It Means

For a period of around 5 hours on the night of 9 January, Amazon’s Kindle Direct Publishing portal offered users a new royalty option of 50%.

The option vanished as quietly as it appeared, but not until after it was seen by dozens of authors and after David Gaughran snapped this screenshot:

Even though Amazon has since explained this away as an error, that was not enough to forestall frenzied speculation.

There is a seven page long thread over on KBoards as well as a post on the ALLi blog. No one really knows what this means, but it is not unreasonable to conclude that changes are coming.

One author noted in the KDP support forum thread that they were only offered the 50% royalty on ebooks that were not in Kindle Unlimited. This suggests Amazon is going to use the lower royalty rate to encourage putting ebooks into Kindle Unlimited by tying the 70% rate to KU.

Remember, Amazon has already restricted ebooks sold in Brazil, Japan, Mexico, and India so that they can only earn a 70% sales royalty if the ebooks are also in Kindle Unlimited.

If it becomes official, the 50% royalty rate would be a further step in the same direction.

That is a big IF, and here’s a second complication: We still don’t know if Amazon will use the new rate as a carrot or a stick.

Will Amazon reduce royalties from the 70% rate for ebooks not in KU? This is similar to what they did several years ago with audiobooks sold through Audible. That is a market where Amazon has no real competition, which, come to think of it, describes the ebook market.

But of course, in the absence of a formal announcement (or a more comprehensive leak) this is just speculation.

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Comments


BDR 18 January, 2018 um 7:39 pm

OR it could simply have been a mistake

Nate Hoffelder 18 January, 2018 um 7:49 pm

Yes – one possibility mentioned on KBoards was that this was intended for Amazon-published authors – that’s how much Amazon pays in royalties.


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