Historical and Contemporary Romance Author

Told You So: Why Digital Royalty Rates Matter More Than Ever

A little over a year ago, I wrote a post on Digital Rights for the New Millenium, in which I urged authors (especially the bestselling ones with clout) to push their New York publishers for a bigger cut of digital royalties. I said it was important to establish a higher threshhold on these royalty rates or we’d all live to regret it.

I hate to say I told you so*, but with today’s announcement that Dorchester Publishing is converting to an ebook first followed by trade POD structure beginning in next month, I have to say I think I’m looking kind of prescient. How many authors out there have contracts with Dorchester specifying very low digital royalty rates (<25%)? I'm betting a TON. Whether they are authors who have only backlists with Dorchester or new books coming out with them, these folks are in a lot of trouble financially unless they can get Dorchester to renegotiate their royalty rates. The Dorchester situation should be a wake-up call to authors. We've known for a while that Dorchester was having financial problems--they sold a lot of their backlist authors to HarperCollins and were recently banned from holding editor appointments or a publisher spotlight at the RWA National Conference due to non-payment/late payment of royalties. But I don't think it's remotely safe to assume that Dorchester will be the last of the "traditional publishers" to go this route. In fact, I'd lay odds that other publishers will follow suit and that, within the next ten years (if not sooner), the vast majority of publishers will be using this model for all but their bestselling authors/books. So, I'll say it again. Digital royalty rates matter. A lot. Even if the majority of your sales TODAY are in print, the same may not be the case tomorrow. And your publisher might, at the drop of a hat, decide to go the way of Dorchester and begin releasing your books in digital only followed by a POD months later. Do you really want to be in the position of taking 15% or 20% of net in this situation? I sure as heck don't.

*Okay, actually, that’s a lie. I LOVE to say I told you so.

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