I would've titled this post Kindle Unlimited and the Indie Author but every author's experience is different. Our books are different, our marketing skills are different---it gets really boring itemizing how different we all are. We're so hung up on trying to find commonalities when we share information that we can't see the forest for the trees.
Here is the forest:
Amazon is a book retailer. They are also publish their own imprints. They are also a mechanism by which authors can self-publish their work direct to Kindle ereaders. They sell the devices as well as the books to read on the devices. They also offer subscription-based access to all books enrolled in Kindle Direct Publishing Select. They have margins.
Here are the trees:
The independent authors who have enrolled their books in Select. They give Zon an amazingly diverse catalogue to hook Kindle Unlimited subscribers and Zon gives them a platform with which to reach readers. Sure, almost everyone wants the blockbuster novels, but indie offerings are the "added value" component of the whole forest. The authors also have margins.
It's a happy, balanced ecosystem until Amazon has to increase its margins and then the authors inside the forest get squeezed. We felt the Amazonian boa constrictor squeeze this week when the KENP formula was changed and the value of our books decreased by about 60 pages. KENP stands for Kindle Edition Normalized Pages. Authors in Select are paid 0.0046 per KENP read. If Mary Sue borrowed my riveting mystery, Iced Under (511 KENP) in January, I would have been paid a $2.35 royalty. Now, I would be paid $2.07. The royalty on a sale is approx. $2.79.
Not too shabby, right? What's 72 cents among friends. And besides, isn't the idea we'll get readers borrowing our books and make a bit of money on the side? Hey, I drank the Kool-aid, I'm not judging.
The kicker is we have to promote and compete to get borrows with exactly the same zeal and expense that we have to promote to get sales. Time and money margins. Only these are not sales and your book is only available in one store, not four (or five if you count Google Play and I don't). And then you open your reports page and whoa nelly! You are down by a sum that you did not see coming.
Okay, so we've been "normalized" after not being normal. Or something. I was all in with Kindle Unlimited until I realized I wasn't building a sales record. I was knocking myself out to get borrows. Borrows are lovely when they're in a library and somebody--somewhere--has already paid for the book. But when you become dependent on them for income, borrows are like living in your mom's basement. And every now and then she threatens to sell the house.
It's been said that KU has cannibalized sales. It's also been said that KU has helped sales. I have no data either way. In my experience, I worked like a dog to promote my novels last year and came out about $10 ahead each month that I was in Select versus wide. Other authors report dramatically different results.
The upshot of all this analysis is no two books are alike. Look at your own book and take your own market and margins into consideration when you're deciding to go exclusive or wide with all retailers. If all else fails, experiment. I liked the convenience of Select but I like getting sales in other markets a whole lot more. I like building a sales history. I like getting my $2.79 fair and square.
My margins are chubbier now too and I like a chubby margin.