Melodee Wants to Know — What About E-Book Prices?

 

What about Apple and E-Books?

Actually, what about E-Book prices?

Most authors are paid in terms of a percentage of the price of the book sold. The details vary from publisher to publisher and from author to author. For those on the outside looking in, a particular author with a particular publisher may get a different percentage than another author with the same publisher. In the self-published world, there are cases where the author gets a flat amount per book sold. Depending on a ton of factors, the percentage the author gets might be based on the actual selling price of the book or it could be based on the cover price, regardless of the selling price. Also, the percentages vary between print and E-Books, but since we’re looking only at E-Books for this article (http://news.yahoo.com/ny-judge-apple-colluded-raise-e-book-prices-231629411.html) we’ll just ignore that for now.

Yeah, it’s complicated.

The real bottom line is that in most cases, the higher the price of the book, the more the author gets per book sold.

It doesn’t matter if you agree or not, but the fact is that legally speaking, Apple was found by a court of law to be guilty of price fixing. Some would say gouging. The several publishers involved have, essentially, admitted guilt and settled. While the last say will—as the article points out—rest with the Supreme Court, right now Apple is indeed guilty…in the same way that OJ is innocent of murder.

Anyway…

From purely an author’s point of view, is the fact that the books are selling for higher prices a good thing? In general, higher prices mean higher royalties. Isn’t that good for the author? Or, perhaps, do the higher prices lead to fewer sales and that translates into less income?

From my own personal experience, I can’t really say…E-Books account for about 2% of the time I spend writing and less than 1% of my income. If graphed, I doubt I could even find the income impact on the chart.

But there are many authors who write exclusively in E-Books with some print-on-demand copies as a kind of spinoff. What’s your take on this?

And then there is the impact on the readers, the people buying the books…

What’s your take? How do you feel about the idea that a group of companies got together to artificially inflate the prices of the books you read? And, perhaps even more interesting, by how much do you think the prices were increased?

What say you?

Keep Loving!

Melodee

 

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2 comments

    • Melodee on August 4, 2013 at 08:51
      Author

    Like I said above, it’s complicated…add to this the fact that print and E-publishers do things differently, and it really gets messy. Oh, and then you have the impact of having an agent to deal with.

    While none of this is by no means an ALWAYS case, let me outline a few typical deals…

    For a print book, the author might be able to get a contract for about 8% of selling price. That is, the cover price doesn’t matter and the author gets 8% of what the book actually sells for. To put this into perspective, if the cover price is $10 and a copy is sold to Amazon for resale, Amazon will pay only 65% of cover or $6.50, so the author gets only $0.52 from that sale.

    On the other hand, if the author has a good agent, they might get 10% of cover price. In other words, no matter what the book sells for, the author would get $1 for every book sold.

    Finally, for a print work, if the author has a really good representative (as opposed to just a literary agent), they could easily get a deal for 15% or more of cover price and pull down $1.50 for every copy sold.

    Just to pick a number of 100,000 copies sold, the three scenarios above lead to payments to the author of either $52,000, $100,000, or $150,000 for the same book.

    Also keep in mind that an agent or representative will usually take 15% for their services, so the agented book would drop to $85,000 and the real representative would fall to $127,500 going to the author.

    On the E-Book side, I have never seen a contract from an E-Publisher that is based on cover price. They are all based on the selling price. I’m sure there are some rare exceptions. The difference is that the royalty percentage tends to be higher…

    Again, an author on their own will probably get around 40% of selling price on an E-Book. With an agent, that number will rise close to 50%. Good representatives will eek out close to 60% for the author.

    And there is another problem with E-Books that most authors will deny despite the actual sales data available from a myriad of sources…

    Print books still sell better than E-Books. Often by a factor of ten or more. Why? Because best estimates are that over half of all E-Books “owned” by readers are illegal copies. A good number of major distributors sell illegal copies, so the reader probably doesn’t even know that the book they bought resulted in no income to the author. And then you have eBay…the average estimate is that 75% of all E-Books on eBay are illegal. Ditto for music and videos, by the way. Worst case is that very close to 95% of the stuff there is illegal.

    What this comes down to is that a popular E-Book might “sell” 50,000 copies, but the author will only get paid for perhaps 15,000 of those.

    And you’re right on the prices. Most E-Publishers pay editors, cover artists, and other support staff a flat rate. Again just throwing numbers out for illustration, the artist might get $200 for a cover and the editor maybe $500 to do the needed edits. These are fixed costs that both print and E-Publishers have in common.

    But an E-Publisher doesn’t actually print the book, and that is easily 60% of the cost of releasing a work. In other words, if a print book is priced at $10, why isn’t the electronic version only $4?

    Damned if I know.

    For E-Books, what I see as an ideal split would be a reasonable cover price with the author and the publisher splitting the selling price 50-50. The editors, artists, etc. are paid a percentage royalty (say they split 20% total) and the author and publisher each give up 10% to pay the support staff.

    The biggest thing this does is to put everyone on a pay for performance basis. With the current payment structure (just to pick on cover artists), the artist gets paid the same amount no matter how good—or how bad—the cover is. The cover is the biggest selling point for a book. With my system, the better the cover, the better the sales, and the more money the artist makes.

    Using a book that sells for $4 and moves 50,000 copies as an example, the publisher and author would each make $80,000 and the support staff would share a total of $40,000.

    Just my thoughts.

    Keep Loving!

    Melodee

    • on August 3, 2013 at 23:54

    While I don’t like the idea of prices being keep high, I like the idea of the authors being paid for their work. I though all authors got paid a flat fee and or a % of sales, regardless of price of book. For years I’ve bought all my books on my kindle, just too conveint and like not having to decide what books to bring with me. Also though that e-books should have been lower priced due to cost savings of an e-book vs hardcopy, especially for a book “no longer in print”. I guess I would be ok if the price is kept high as long as the author gets their their profit instead of apple getting a higher cut. While not the same have a friend who is a developer, she keeps a bigger % of sales from Google than apple, hope that’s not the same with authors and e-books

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