What Royalty Should Publishers Pay Authors For Ebooks?

Publishers maintain a 25% royalty on ebooks is generous but the Authors Guild thinks it should be 50%. Author Kelly McClymer's thoughtful husband has crunched the numbers and determined what he believes, based on industry figures, what he thinks the fair royalty should be. He goes into great detail about how he determined those numbers, and it's truly fascinating to read, but here's the bottom line:

25% net is much too low a royalty rate, a 50% net is too much as it assumes no cost to the publisher and is not realistic. […] Ebook royalties should be between 31.4%and 45% of net. The lower royalty rate assumes publishers have the same cost to publish an ebook as a paperback while the 45% has a more reasonable cost.

3 thoughts on “What Royalty Should Publishers Pay Authors For Ebooks?”

  1. I’ll give Mr. McClymer credit for trying to come up with something, but as he repeatedly says, he’s pulling numbers out of thin air. While publishers will save on printing, transportation, returns, and warehousing, they still must pay for editing, copyediting, proofreading, packaging and cover design, royalty accounting, title accounting, publicity, cataloging, sales and marketing operations, transformation of a book into electronic form by skilled technical staff, administration, plus reasonable profit.

  2. Richard, I see your point, that print publishers have a lot of costs, and FOR THE BOOKS THEY ACCEPT, they do an arguably good job of preparing the book for publication, and so they deserve to reap a profit, and that you like and respect this system.
    Okay, but (1) what about the books they do not accept, and (2) what about the fact that epublishing is eliminating and/or greatly reducing these costs and passing the cost reductions onto the ereader? Which system is better for the writer and the reader?
    First, print publishers have greatly narrowed their focus on books they will publish: they want blockbusters and books that will make the most money. So A LOT OF GOOD BOOKS won’t get published because they are not mainstream commercially. Therefore, epublishing gives all these books a chance to find an audience, which is a better system for the writer and the reader.
    Second, prices. Epublishing eliminates so many, many costs, and reduces the others so dramatically, that it’s something of a technological miracle. And these savings are passed onto the reader, which is what technological advancement is supposed to do. But at the same time, epublishing pays a much higher royalty rate to the writer. So epublising is better on this count for writer and reader than print publishing.
    Lastly, I’d argue that print publishing is one thing, epublishing is another. If a print publisher wants to publish a book, fine, but the print publisher should have NO PARTICIPATION IN THE EBOOK ROYALTIES AT ALL. Epublishing can be done by the writer alone, and the writer alone should receive eroyalties, in my view.
    But then maybe I’m ahead of the curve.

  3. I think the norm with epublishers (of 30-40% of cover) is probably about right. I am not interested in self-publishing my ebooks and am happy to receive royalty in that range. Epublishers offering 50% or cover or more don’t generally seem to last long–suggesting, to me, that it might be a bit steep.


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