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Ebook Royalties–The Perfect Contract?

27 Jun

Thx 2 http://www.the-ebook-reader.com

Authors, indie and traditional, take heed.

Some indie authors check their sales numbers almost every day, like military historian Charles R. King. How do I know he checks his numbers daily? I’m married to him. As far as I know tracking sales this way is not an option for traditionally published folks. Correct me if I’m wrong.

It’s not a perk I would miss. I can’t remember the last time I checked my sales, but I do monitor those royalties. We indie authors make the decisions on pricing and along with that is often what percentage of royalties we’ll earn. For example, if you price below $2.99 on Amazon your royalty is 30% as opposed to 70% above that price point.

Traditional authors are not faring quite as well according to this recent article on FutureBook.net. Here’s an excerpt:

Brian DeFiore smartly spotted a rather telling bit of information in Harper Collins’ “Investor Day” presentation (thanks to Porter Anderson for the link).There are lot of different ways of expressing the numbers in the various articles discussed here, but the burden of the whole thing is neatly expressed by DeFiore:

$27.99 hardcover generates $5.67 profit to publisher and $4.20 royalty to author 

$14.99 agency priced e-book generates $7.87 profit to publisher and $2.62 royalty to author.So, in other words, at these average price points, every time a hardcover sale is replaced by an e-book sale, the publisher makes $2.20 more per copy and the author makes $1.58 less. If the author made the same $4.20 royalty on the e-book sale as he/she would have on a hardcover, the publisher would STILL be making an improved profit of $6.28.

What these numbers don’t take into account are paperback sales.

Still I am taking note both as an indie author and indie publisher now turned publisher. As an indie author, I like how my numbers stack up and how my options for the future play out. As a publisher I’m turning a critical eye to my first signed contract and finding it blessedly non-commiserate with big houses.

I’m left to wonder, though, what would your ideal publishing contract entail?

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4 Comments

Posted by on June 27, 2013 in Indie Business

 

Tags: , , , , , , ,

4 responses to “Ebook Royalties–The Perfect Contract?

  1. tmso

    July 1, 2013 at 3:27 am

    I do see the need for that kind of service, and glad to see you delving into that market, but I suspect that the perfect contract will depend on the writer. As a cottage imprint, you’ll probably have the flexibity to find that for each writer you take on? Just a thought.

    Wool is awesome, but something we shouldn’t use as an example. Howey put that out after is Parsona sci-fi series (which are good, but not great). Wool was a fluke short story he wrote in response to someone close to him dying. He hadn’t meant to market it nor did he anticipate the response it would get. When the first (and only, at that time) story took off, then he wrote the rest – in response to his readers’ demands.

    That sort of success is not easily repeatable, nor teachable (other than to keep writing and put your work out there!).

    Not sure what my point is but getting a contract like Hugh’s is defnitely not something the rest of us will get. 🙂

     
  2. kristinkingauthor

    June 28, 2013 at 10:20 pm

    N.E. White–Thanks for commenting. You’re right, of course. The value added should be considered. Do-it-yourself folks really don’t need a publisher unless they put out a run away hit (ala WOOL) that a big house is ready to launch to the next level. What I see more often are writers who have talent and reader-ready stories but they lack the technical expertise to get their works to an audience. They think b/c agents turn them down, their career is over.

    I envision my imprint as part of a cottage industry. Writer has the goods, we provide the sprucing (e.g. edit, format, and cover) to put the work on the public shelf. Some will say vanity presses operate in similar fashion except they gouge the author upfront, take their %, and will frequently publish anything. Vanity makes its money charging for the services that I do to earn my % of sales from a work I wouldn’t be publishing if I didn’t believe there was a solid market out there.

    As an author, I’d like to think I’m giving other authors a fair shake, a contract closer to perfect than anything they’ll find elsewhere. So that leaves me wondering, what would other indie authors consider the perfect contract?

     
  3. tmso

    June 27, 2013 at 11:55 pm

    Hi Kristin, those are interesting numbers, but it seems now that it is all so complicated, it is hard to know what a ‘perfect’ contract would contain. I do think, one has to consider the value (or lack of value) a publisher brings to a project.

     

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