Readers pay a monthly fee, have unlimited borrows; Writer get paid per page-read.
Amazon gave indie authors an unexpected data-gift by releasing the number of page-reads in June along with the payout for the KDP Select program ($11M for the pot divided by 1.9 billion page reads = 0.6 pennies per page). Here's my breakdown on the numbers you want to know in the newly launched (today) page-read system in KDP Select program.
Find the KENPC page count for your book under the Promo&Advertising tab in KDP.
OLD MODEL - per-borrow
98k novel = 414 pages* = $1.34 per borrow = 1/3rd of penny-per-pg
15k novella = 51 pages* = $1.34 per borrow = 2.6 pennies-per-pg
*the number on the product description pg
NEW MODEL - per-page-read (assuming 100% read)
98k novel = 553 pages** = 0.6 pennies-per-pg*** = $3.32 per 100% read
15k novella = 85 pages** = 0.6 pennies-per-pg*** = $0.51 per 100% read
**KENPC page count
***estimate from June moneyz
Major Takeaways1) The per-borrow model favored short reads, to the cheers of short story and serial writers and boos of novel writers. The per-page-read doesn't play favorites - pages read are pages read, no matter if they're in short stories or novels. The NEW MODEL is blind to the length of story.*
*even though I write both serials and novels, I think this is a good thing.
2) The 0.6 penny payout per page in the NEW MODEL is roughly equivalent to 1 penny per page under the OLD MODEL. Why? Because the pagecount is higher with the NEW MODEL. A penny a page is about halfway between what serials and novels were getting under the OLD MODEL. In other words, Amazon leveled the playing field, bringing the payout for novels up and the payout for shorts down... but the overall money in the system about the same.
3) The system hasn't changed for readers, so borrow rates, at least for now, should be similar to before.
My Major Conclusions1) Serials still make money with borrows, just not outrageous amounts like before - my 15k novella is making 51cents per borrow vs. 35 cents per sale (assuming 100% reads). This means KU for serials and shorts still makes sense.
2) I'm putting my serial boxsets in KU, as long as they don't have a permafree first episode - because I suspect read-through will be better, plus putting borrows on the box set increases visibility.
3) Otherwise, I'm holding tight (keeping most properties where they are right now) to see if the payout rate really is 0.6 pennies per page in August.
4) Borrow payouts are more comparable to sales earnings now... depending on your pricing, page-length, page through-read, etc. My 98k novel lists for $3.99, which is $2.79 for a sale, but $3.32 for a borrow. My 15k novella lists for $0.99, which is $0.35 for a sale, but $0.51 for a borrow. All of that is assuming 100% read-though rates, which is overly optimistic, and that the 0.6 pennies per page rate holds. The payout for borrows is comparable to sales at approximately 70-85% read-through rate. When you add in the extra visibility for borrows, and the fact that readers aren't paying for borrows (and thus more likely to download vs. a sale), this means KU is potentially lucrative for both shorts and novels.
How Many Pages In Your Book?The pagecount displaying on your Amazon description is closer to a print-based 250 words/page, whereas the new KENPC page count Amazon is using is closer to the size of a Kindle page display, or around 175 words/page.
Interestingly, the words/page conversion rate appears consistent across all my works (crossing genres, serials, novels, etc.)... but it varies from author-to-author. I've seen everything from 151 words/page to 233 words/page in individual authors. In other words, words/page conversion rate appears to be a function of the author's style.
(Note: this does not depend on your formatting - Amazon claims to have standardized the format for page count purposes, and that appears to be true.)
A couple friends volunteered their manuscripts for tribute to analyze exactly how this was happening. This is a subjective analysis, but I standardized everyone's format (spacing, etc, doesn't matter for KENPC calculations anyway, see here) and analyzed for size of paragraphs, number of sentences per paragraph, number of words per sentence, etc. Basically, the fewer sentences per paragraph and words per sentence (aka more dialogue, or your style is closer to Hemingway than Franzen), then your number of words/page will be lower (and lower is good for payout rate).
I expect you all to start writing like Hemingway now! (kidding)
Check across your books, but I'm finding my works are consistently between 170-175 words/page... that's just my style, and it apparently doesn't change dramatically from work to work. So, for planning purposes, I can use that number to see how much a certain work will fetch in the borrow system.
To KU or not to KU?Everyone will have their own answer to this question. If you are against the subscription business model, by all means opt-out. But understanding how it affects the marketplace is important for everyone. Serials and shorts may not be as lucrative as before, but they still pay better under the borrow system than as sales. And now that KU is blind to the length of your story, you're free to craft it however you like... and given that readers seem to love short stories and serials (at least in romance, but increasingly in other genres), I don't expect those forms to go away. And KU still offers the benefit of increased visibility (due to borrows - ranking is not related to page-reads), so KU titles are likely to continue to dominate the bestseller charts.
Overall, the page-read system rewards writers whose stories keep readers turning those pages... no matter what form those stories take. As always, giving the reader what they like to read is the best strategy of all (see this excellent post to that effect by Hugh Howey).