There has been some grumbling lately among my Indie compatriots about the decrease in Kindle book sales caused by the advent of Kindle Unlimited.  Having made the decision long ago to go Kindle Select with 13 of my 14 titles, I've watched the effect on my sales and income with considerable interest.  The conclusions I've drawn are at odds with most of what I've read recently, so I thought I'd share my observations.

First, to clear the air on my biases:

I'm an independent, self-published author.  I derive a substantial portion of my income from sales of my books.  Most of that comes from ebooks.  All of my ebook revenue comes from Amazon, because I made a business decision to focus on them as my channel to market.

I haven't always been an author; I published my first book late in 2010.  I have a lot of respect for Amazon as a business.  From my own experience in the corporate environment, I think that no outsider, and that includes the 'investment professionals' and 'industry experts,' is in a position to second-guess Amazon's business decisions.

I think it's safe to discount all of the speculation in the press about what Amazon's doing and why and focus on things closer to home.  Amazon is neither good or evil from my perspective.  They do what is best for them, balancing the interests of suppliers (writers among them), customers, and investors to further their own interests.  We can agree or disagree with what they do, but if we want to sell books, we need to deal with them.

What about Kindle Unlimited?

When Amazon introduced Kindle Unlimited in the U.S. store in July, I saw an immediate increase in the number of borrowed books over the level I was accustomed to from Amazon Prime borrows.  The percentage of my total paid units borrowed went from an average of 5.5 percent to about 14 percent in July.  In August, it jumped to about 24 percent.  The program started in mid July, so that makes sense.  My percentage borrowed has averaged about 25 percent for the last half of 2014.

My first reaction was that borrows were cannibalizing sales, so now that I have several months of data, I've done a little analysis.  I've used some standard analytical tools to normalize the data for the first half and the second half of 2014.  I normalized the numbers to remove the effect that adding new books to the mix had on my total numbers.  Don't get stuck on the math, but if you changed your offerings during the year, it's necessary to wash out the effects of adding or deleting books before you start making comparisons.

In my case, the increase in volume as a result of more borrows has more than offset the effect of price erosion from Kindle Unlimited.  My average revenue per unit dropped by about 9 percent, but my number of paid units in the second half was 35 percent higher than the first half.  The surprise is that my revenue for the second half was 46 percent higher than for the first half.  Borrows increase rankings and make your book more visible, as well as making it less risky to people who don't know your work.

I'm relatively new at this and still building recognition among readers.  Someone with a much bigger base of fans might see different results, but I'm much happier with Kindle Unlimited than I was with the notion of giveaways to build a base of readers.

 Let's hear your thoughts on Kindle Unlimited, whether from the perspective of a writer or a reader.