What if the gift total for a title is <$20?
What if gifts can't be found by an author?

Probabilistic Payment Is the Efficient Solution

Gifts for a title may not be collected:

  • The title may be misspelled.
  • Gifts may total <$20.
  • The author may not be aware of the gifts.

If the gifts for a title are uncollected for 2 years, they become probabilistic payments.

What does that mean?

It simply means that the author receives a fair chance to win $500.

Mathematically, a Fair Chance = TOTAL UNCOLLECTED GIFTS FOR THE TITLE/$500.

A random drawing is done by AE's software, using this fair chance, and then:

  • if the author wins, AE finds her and pays her $500, minus transaction costs.
  • if the author loses, the balance goes to $0 for the title.

This form of payment is the most efficient way to transact small payments.

Example

Imagine you’re Margaret Atwood and Sally gives you $10 for “Handmades Tail by Atwood.”

You can’t find the $10 because Sally entered a misspelling of your book, The Handmaid’s Tale.

The $10 is associated with “Handmades Tail by Atwood” in AE’s database.

So: at the expiration of 2 years, AE gives you a fair chance to win $500.

Your Fair Chance = TOTAL UNCOLLECTED GIFTS FOR THE TITLE/$500.

In this case, $10/$500 = 1/50.

You have a 1/50 chance of winning $500.

AE spins a pseudo-random number generator to determine whether you win or lose.

If you lose, the amount you’re owed for this misspelled title goes to $0.

If you win, AE finds you and pays you $500, minus transaction costs.

Author Must Be Contactable

This method, a.k.a, the expected value payment method, works for any amount owed.

But, the author must be contactable to get paid the $500.

What if AE can’t find the author?

In this case, AE keeps the $500 for software development for all authors.

Have a Question?

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