Posted by: Kathy Temean | January 21, 2010

Royalty Increases at Amazon

Amazon Increases Royalty Rate for Books on Its Kindle E-Reader

By MOTOKO RICH

 

In what appeared to be a clear bid to anticipate the release of the breathlessly awaited Apple tablet, Amazon announced Wednesday new royalty terms for authors or publishers who release e-books through its Kindle’s digital text platform, a direct publishing initiative.

Authors and publishers will be offered a royalty rate of 70 percent of the digital list price after “delivery costs,” typically about 6 cents per digital unit. This rate is similar to that currently offered by Apple in its app store.

Amazon’s move is also a clear bid to woo authors away from traditional publishing houses. Publishers typically offer authors a royalty rate equal to 15 percent of a hardcover list price and 7.5 percent of a trade paperback list price. On digital books, the emerging industry standard among the largest publishing houses is 25 percent of net proceeds from the sale of an e-book.

Amazon has set some criteria for authors or publishers who want to receive the 70 percent royalty. List prices must be from $2.99 to $9.99, a maximum that is much lower than the typical hardcover price of around $25. The e-book’s list price must also be 20 percent lower than the lowest list price for a physical copy of the same book and the same price as or lower than any competitor’s price.

Any thoughts on whether this is good for writers?

Kathy


Responses

  1. Royalties are great, but IMHO, the more important news is that a major player is working to bring the prices of ebooks down. ePublishing is not going to go mainstream until the prices are reasonable.

    Like

    • Camille,

      You probably are right. I wonder how this is all going to shake out for the authors? Will it mean more books getting published? Will it mean more money or less for an author’s writing? Is this the demise of real “Hold in your hand” books? I wish I had a crystal ball.

      Kathy

      Like

  2. Should we writers wait to sell the rights to Kindle if Apple Tablet is coming out in less than three months, should we wait for the criteria on royalty stabilizes?

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    • Tatiana,

      Boy, I wish I knew the answer to that. We are on the edge of the unknown. I will be going to the SCBWI Conference in NYC next week and look for opportunities to ask this question and other question in relation to this whole market. I will definitely share anything i find out.

      Kathy

      Like

  3. I’ve always hated the thought that books were trending toward digital (my father’s been saying this was the future for books for at least 15 years *sigh*). It’s hard to really know what will be better for authors because it seems that ebooks will be in flux more. Hand-held books will always cost $ in the way that there are tangible materials that cost $. Ebooks are only digital, so the actual cost won’t really change to produce or deliver them.

    Anyway, although I’ve come to see the ways that the Kindles and Nooks can be very convenient and they have their place, I will always prefer actual books. I want to feel the paper, see the cover, be able to flip pages, etc. I have a friend here at Barnes who received a Nook for Xmas and said she was in bed reading with it *sigh* It broke my book-loving heart.

    Like

    • Donna Marie,

      Even with loving technology, I don’t like the idea of losing the tactile feel of holding and book and like you said, “turning the page.” I can see text books on a Kindle or being able to read manuscripts on a Kindle if you are and editor or agent, but I want to keep my books.

      On the other hand, maybe they will provide more opportunities for authors and illustrators to get published – that would be a good thing. But I know I would be disappointed to only have my book published that way.

      Kathy

      Like


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