MSI Press Blog

  Understanding royalties is one of the most important—and most misunderstood—parts of publishing. The numbers look simple on paper, but the basis on which they’re calculated can dramatically change what an author actually earns. Below is a clear, practical overview of what’s typical, what’s fair, and how to protect yourself from the “hidden math” of net‑based royalties. 1. The Two Royalty Models: List vs. Net Royalties on List (Cover Price, MSRP) Calculated on the book’s full retail price Transparent and predictable Example: 10% of a $20 hardcover = $2 per copy Royalties on Net (Net Receipts) Calculated on what the publisher actually receives after retailer discounts and other deductions Retailer discounts are typically 40–55% A “10% royalty” on net often yields far less than a “10% royalty” on list “Net” may include deductions such as freight, warehousing, marketing fees, and returns Which Is Better? List‑based royalties are almost always better for authors Ne...

  It is Tuesday. Monday's madness is over, and Wednesday will take us over the hump, so Tuesday it is--for some serious discussion with authors. Tuesday talks mean to address authors in waiting and self-published authors who would like to go a more traditional route or who would at least like to take their steps with a publisher by their side.  This week, we share a conversation with a first-time author, who is new, naive, and nervous when it comes to the financial side of authoring a book. Specifically, this author clearly did not understand the difference between royalties on list and royalties on net. The pertinent part of the conversation elucidating these differences is reproduced here. Typical Royalties on List and on Net Briefly, royalties paid on list are paid at a percentage of the list price of the book. Royalties paid on net are paid at a percentage of what the publishing house "earns" after costs are subtracted from gross revenue. The differences are explicate...