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Ebook Royalty for Writers and Authors: How Much Money Could You Possibly Get?

By: Johnny Jones

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Creating a truly unique and useful ebook is not an unproblematic job: it takes substantial time and effort to compose a piece of work that is truly correct, to-the-point, and enjoyable to read. So unless you are just writing for the thrill of it, you must cautiously weigh in what your possibilities are in terms of your future royalties. How much royalty you will obtain depends on a number of factors.

Naturally, "payment" or "royalty" is not an entirely uncomplicated subject to talk about. Without doubt, the concept of royalties is in essence about the particular amount of dollars or pounds sterling that you would get with a certain publishing deal. But there are also alternate aspects of an agreement or contract that may be just as important, and perhaps even more so. Such aspects can be, for example, the length of the contract, the question about the exact time for payments, and so forth.

However, in this current article I shall mostly address the overall amount of money that you can expect from various kinds of royalties arrangements. Even though there are lots of different types of arrangements in the publishing world for writers and authors, I shall in this short article run through only four kinds of royalties: "list price percentage|, "net receipts percentage", "net receipts percentage", and "full list price".

1. Publisher's "List Price Percentage" Royalties

The "List Price Percentage" royalties model is perhaps the most "intuitive" of them all. This royalties model is applicable when authors or writers approach major publishing houses to market their ebooks (or even ordinary books). This model basically boils down to that the writer will receive a certain percentage of the ebook's (retail) list price. The precise percentage typically varies between 10 and 20 per cent.

For instance, if the royalties arrangement is such that the author gets 20 percent of the $15 the ebook is sold for, the author should get a royalty of $3 per book (0.20 x 15).

This sort of royalties model has previously been "standard procedure at top publishing houses such as Random House and Simon & Schuster. However, these publishers have now transferred to the second royalty model, the "Net Receipts Percentage".

2. Publisher's "Net Receipts Percentage" Royalties

Another royalties model is the "Net Receipts Percentage", or the "Net Proceeds Percentage" model, which is used when authors are trying to get a deal with major publishing houses to publish and market their e-books. At present, many publishing houses use this royalty model, including Macmillan, Random House, and Simon & Schuster.

In this set-up the writer will receive a given percentage of the net sales of the ebook. This percentage in general amounts to between 10 and 25 per cent of the net proceeds.

For example, if the royalty agreement is such that the author gets 20% of the net proceeds, then the computation may look something like this. Assuming a list price of $25, and also assuming that the net sales for the publisher is, say, 60 percent of the list price (i.e., the retailer gets 40%), the author should get a royalty of $3 per ebook (0.20 x 0.60 x 25).

3. Self-Publisher's "Flex-Price Net Receipts Percentage" Royalties

The third option would be to publish your ebook on your own, but still use one or more retailers and distributors to promote and sell it. For example, you might use distribution channels such as Lulu.com.

In this set-up the writer will obtain a particular percentage of the net proceeds of the e-book, and in that sense it is quite similar to the second model above, the one named "Net Receipts Percentage". However, even though the models are similar, the "Flex-Price Net Receipts Percentage" has the main advantage that your share per book will be radically higher, assuming that you will sell your ebook for more than just a dollar or two.

Another big dissimilarity is this. Because you are self-publishing your ebook, you can actually choose yourself what the list price should be. Because of that you will have additional flexibility in terms of picking a product price that might generate maximum royalties.

4. Self-Publisher's "Full List Price" Royalties

Option number four is to do everything yourself. In this case you will be doing not only the publishing of the ebook but also the marketing, advertising, and promotion, as well as the sales. This means that you almost surely need to have your very own website or blog where you promote your product or products.

Note, however, that you do not inevitably have to have a very complicated e-business solution integrated with your website. You might instead utilize a simple solution such as the payment processing used by paypal.com, or other similar solutions.

Anyhow, the amount of royalty to be estimated from this fourth model is fairly easy to compute, as you will keep all the proceeds for yourself. Logically, however, depending on the particular solution you are using, you may wish to adjust the figures, in order to properly account for costs related to services such as the site or blog hosting or your payment processing, etc.

Summing up

It might not be very easy to decide which royalty scenario suits you best. One point is, for instance, how interested you are in marketing. If you are very interested in marketing your own ebook or ebooks on the internet, then royalty scenarios 3 and 4 may very well be for you.

However, if you are primarily an author, and not so interested in online marketing, it might not be a bad idea to aim at the first and second royalty models. The downside with these two royalties scenarios is, however, that it may not be so simple to get published; but if you don't get published, you can always try models three and four as your plan B.

Article Source: http://depositarticles.com/

Johnny Jones has a background in publishing and project management, and is currently a contributor to the EbookBrothers.com website, where he writes about ebook business, including topics such as {ebook royalties for authors etc. For a free subscription to the EbookBrothers.com Newsletter (with free articles, tips, and tricks on how to make money with ebook

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