Amazon nearly doubles Kindle royalty rate

Posted by Mike Luttrell

The latest move in the all-out e-reader war is showing just how profitable the heated Kindle vs. iPad vs. Nook vs. Kobo battle can be, for publishers.

Amazon today announced that some authors can now choose to receive a 70% royalty rate on all Kindle books sold. The new rate applies to list price minus delivery costs (which are generally just pennies per copy).
"For example, on an $8.99 book an author would make $3.15 with the standard option and $6.25 with the new 70 percent option," wrote Amazon in a statement.

The 70% royalty applies to all books sold through sales to an actual Kindle device, as well as all Kindle app sales on gadgets like the iPad, Android, and Blackberry.

The new rate comes with stipulations too. For example, the book must be priced at between $2.99 and $9.99, and must be available on the Kindle at least 20% below the physical book's list price.

Additionally, "Books must be offered at or below price parity with competition."

It is yet another way for Amazon to try to remain at the top of the e-reader market. After once having a monopoly with the Kindle, it is now facing fierce competition from similar devices available at Borders and Barnes & Noble, and Apple's iPad is also seen as a competitor.

"We’re excited about the launch of the 70 percent royalty option... because they enable authors and publishers to conveniently offer more content to Kindle customers and to make more money from the books they sell," said VP of Kindle Content Russ Grandinetti.