What if the gift total is under 100 dollars? What if gifts aren’t collected by an author? Are they stranded?

When the first gift is made for a title, a 2-year clock starts to run for that title.

If the gifts for the title have not been collected in 2 years, AE clears out the gift balance using the expected value payment method, and resets the 2-year clock.

What’s the expected value payment method? How does it work?

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

The prize is $500.

An example will illustrate.

Imagine you’re Margaret Atwood.

Imagine Sally gives you $10 for “Handmades Tail.”

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” in AE’s database.

Here’s what AE does: at the expiration of 2 years, it gives you a fair chance to win $500.

Your fair chance of winning is: (TOTAL UNCOLLECTED GIFTS FOR THE TITLE)/$500.

So, in this case, $10/$500 = 1/50.

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

AE spins a 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 a 10% transaction fee).

The expected value payment method works for any balance.

“Handmades Tail” may have $100 associated with it after 2 years.

In this case, your chances of winning would be $100/$500 = 1/5.

Why can’t software find all the misspellings and show them to you?

Well, at some point it might.

For now, this method is fair and efficient.

What if the TOTAL UNCOLLECTED gifts are >$500?

In this case, you, the author, have a 100% chance of winning.

AE finds you and pays you the full balance.

What if AE can’t find the author?

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

Have a Question?

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