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from the L.A. Times

Amazon offers authors bigger cut of book sales, snubs traditional publishers

Kindle 2 Amazon is playing hardball with book publishers.

The Seattle online bookseller this morning said it will give authors a 70% cut of the sale of e-books sold for its Kindle readers, net of digital delivery costs -- essentially offering writers a way to bypass traditional book publishers.

In a direct snipe at print publishers, the company asserted that authors would get more money if they published digitally with Amazon.

"Today, authors often receive royalties in the range of 7 to 15% of the list price that publishers set for their physical books," Russ Grandinetti, Amazon's vice president of Kindle content, said in a statement. "We're excited that the new 70% royalty option for the Kindle Digital Text Platform will help us pay authors higher royalties when readers choose their books."

There are strings, of course. Authors must set the price of their books between $2.99 and $9.99 to qualify. If there is a physical version of the book, the Kindle price has to be at least 20% below the print copy. While the author is free to sell their books elsewhere, such as Sony's or Barnes & Noble's online bookstores, Amazon must be given the same or lower retail price. Finally, authors would need to give Amazon a broad set of digital rights to the book, including the ability to turn text-to-speech and all future features of the Kindle. The offer applies only to digital copies, not printed copies.

Amazon's timing is curious given that Apple has scheduled a news conference for Jan. 27 to reportedly unveil a tablet device that can be used as an e-reader, among other things. Apple has been making the rounds to publishers, studios and game companies to gin up content that would showcase the device's capabilities, according to numerous sources.

Amazon's relationship with publishers has been strained, and today's move isn't likely to endear the online retailer any further to its book vendors. The source of tension? Amazon's decision to price new releases and bestsellers at $9.99 a copy for its wireless Kindle. Publishers fear that the price will cannibalize its lucrative hardcover market, where books are sold for $25 or more.

Three major publishers -- Simon & Schuster, Hachette Book Group and HarperCollins Publishers -- struck back at Amazon last year, announcing they will delay the release of digital copies of select titles for four months after the print versions' debut. (The move is akin to delaying a movie's DVD release until after it's hit movie theaters.)

In this light, publishers see Apple as a potential counterweight to Amazon's massive influence over the book market. Will Apple's terms be any better? We'll find out in a week.

-- Alex Pham

Follow my random thoughts on games, gear and technology on Twitter @AlexPham.

Photo: Kindle 2 digital book reader. Credit: Amazon

 
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