[Kali Yuga]

Originally Posted by Barcey

I have yet to see anyone argue that authors should be making less money because it's an e-book.

Uh huh. Most big publishers have profit margins ranging from 8-15%, hardly an extortionate rate -- in fact, right around the same range as a typical author's royalty rates. Meanwhile, the public is demanding that publishers both slash their prices by 30% (far more than what they save by going electronic) and increase their costs even further by doubling, or tripling the royalties.

Would you like it, by the way, if your boss decided to slash your salary by 20% because he found out you moved to a cheaper apartment? After all, your costs are now lower, so why do you need the extra money?

Originally Posted by Barcey

I personally think that authors were getting a raw deal on paper copies (which is not surprising because they've been negotiating from a position of weakness - they're already risk vested when they're negotiating with the publisher).

• Experienced writers who can actually sell a decent number of books actually have a bit of strength in their negotiations, as they can actually justify the advances and higher royalties.
• Novice writers generally have not demonstrated any ability to sell their books. Just taking on a new writer is a leap of faith, and requires an investment of significant resources.
• Self-published writers get a "better deal," but zero support and zero dedicated resources. As such, it is extremely unlikely that a self-published author will ever make a decent wage from their writing efforts (though if they are targeting a small audience, they may very well accomplish their goals).
• Authors don't necessarily get a "raw deal." The publisher invests a lot of time, money and other resources into getting a book published and distinguishing it from the other 250k new books (not including another 250k of short-run and on-demand titles) published every year.
• Authors don't take 50% of the financial responsibility or risks involved in publishing the book. As such, the standard royalty rates -- while perhaps not perfect or ideal -- are far more fair than you assert.
• No one is forced to sign a contract. If an author doesn't like the deal, and they sign anyway, that is their own responsibility.

Originally Posted by Barcey

What readers will not accept is that they have to pay more for e-books because the authors signed a bad contract with the publishers. Having the author's cut tied to the list price for e-books is just wrong.

What ebook readers will not accept is that it actually costs money to produce an actual professional book, or that prices are based as much on demand as anything else. In a few years, the idea of pegging an ebook's price to a paper copy will be an absurdity, since paper will be largely gone.

Originally Posted by Barcey

Take a $24 list price hardcover. Say the wholesale price is $12 to Amazon. Remove the $2 printing costs. Remove the risk of returns. The publishers are making more net profit on a $10 e-book paying the author less and trying to tell the readers they have to pay more to support the poor authors.

Incorrect, especially with an agency model.

$15 cover and list price for an ebook; retailer gets 30%, author gets 10%. Revenues (not profit) are $9. From that $9 you have to repay the investment in the book (advance, editing, proofreading, marketing, special promotions, maybe a book tour), pay taxes, pay your overhead, pay your staff and so forth. And of course, many books just don't sell, and something needs to fill that hole in the ground. The publisher's profits -- what's left over after all that -- is much smaller; as I mentioned, it's around 15%.

Originally Posted by Barcey

The publishers then have the nerve to guarantee Amazon/Apple 30% for performing an electronic transaction. If they really cared about the author why aren't they guaranteeing them 30%.

Because the authors aren't taking as much of a financial risk as the retailers.

A typical author isn't putting out a lot of cash to get their book sold. The retailer, on the other hand, is hosting tons of content; handling credit card transactions; security for all of the above; paying taxes. Plus they provide a platform and access to an audience a solo author, or even sole publisher, could not possibly achieve. I.e. without the retailer, you are not selling squat.

As with most other aspects of a capitalist society, the publishers pay the authors what the market will bear. Over 45,000 new fiction books alone are published in the US alone (again, not including on-demand and short runs). Not many of these books sell enough for the publisher to recoup their investment; a tiny handful turn into blockbusters.

So like it or not, there is a tremendous surplus of books, and a tremendous number of people who are willing to write those books. That fact alone results in low royalties.