P. asked Lois McMaster Bujold:

Hello; Do authors usually get a percentage of the profit after costs for the sales of the book? If they do, how does that work with e-books? The cost is much lower to produce and no shipping costs so when that is factored out, so the profit starts coming sooner doesn't it?

Lois McMaster Bujold The answer varies with the type of book and publisher and the terms of the individual contracts. Typically, the author will be due royalties, i.e., a percent of the cover price of each book sold retail, in the neighborhood of anything from 2% (in the more abusive practices of some romance and academic publishers) to 6-8-10% per paperback sale, to 15% for hardcovers after a certain sales break-point. You can do the arithmetic, but that translates to a range between $.48 for an $8 paperback to $3.75 for a $25 hardcover of the purchaser's money going to the author. (As one can see, a writer needs to sell a pile of paperbacks to make a living.)

(As a side note, the rest does not all go to the publishers, who sell books to vendors at discounts of up to 50%. The difference between wholesale and retail is what the bookstores live on. The waste in the system would take a whole 'nother essay, but look up "remainders.")

An advance is money paid up front to the writer as a debt against future royalties. The author's share when the book is finally put on sale goes first to paying back the advance, at which point the book is said to have "earned out" and twice-yearly-accounted royalties start flowing to the writer. There is a lot of mythology surrounding the size of advances, but I think of it as money earned by my future self being paid to my current self. The publishers assume some risk in this regard, since they have to eat the difference if the advance does not earn out -- it is non-returnable.

Ebooks are even more wildly varied. It is important to note that entities such as iBooks, Amazon, and B&N are vendors, not publishers. Per unit sale, Amazon ferex keeps 30% of sales priced over a certain break point -- I don't remember offhand if it was $1.99 or $2.99 -- passing 70% through to the author or publisher, and keeps 65% for sales under the break point, passing 35% through to the originator. They pay monthly. If a book is indie published, this goes directly to the writer, after an initial 3-month delay.

If an ebook is published through one's paper publisher, the publisher passes 25% - 50% of their e-receipts through to the author as royalty, so the author gets 50% of 70% = 35% of each ebook sale, accounted quarterly or half-yearly. The publisher potentially does a hella lot of work for the writer and their book to earn this, so most writers I know regard the 50% split as fair.

Terms for ebooks sold directly through publishers' websites or other venues will vary with the publisher.

Ta, L.

(The other crucial factor for non-indie writers that has changed with the arrival of ebooks is contractual term-of-license, but that, too, would take another essay.)

flag