In a story being picked up by a number of major geek or e-book blogs, such as Boing Boing or Seth Godin’s Domino Project, the self-published author of an 18-megabyte illustrated travel book complains on his blog about the $2.58 chunk Amazon takes out of the money he gets for every sale for wireless delivery. Author Andrew Hyde writes:
I’m confused. Amazon stores a ton of the Internet on S3/EC2, they should have the storage and delivery down. If I stored that file on S3/EC2 it would cost me $.01 PER FIVE DOWNLOADS. Hat tip to Robby for that one. Use Amazon to run your website: .01 to download a file. Use amazon to sell your book: $2.58 per download + 30% of whatever you sell.
The culprit here is Amazon’s $0.15-per-megabyte delivery fee, which applies even for books downloaded over wi-fi. All Amazon e-books pay this fee, but given that most of them are less than a megabyte (or even less than half a megabyte) in size the fees tend to get lost in the noise. (7 cents out of a $5 book? Who cares?) As an illustrated travel book, Hyde’s book’s file has to be bigger and, thus, cost more to deliver.
On The Digital Reader, Nate Hoffelder calls this a non-story, pointing out that the fee schedule was posted openly as part of the contract terms self-publishing authors have to sign when they post their books through Amazon, and the only real story here is that Hyde was surprised by it after publishing the e-book. And if he was surprised, Nate holds, it’s Hyde’s own fault for not paying closer attention to those terms before making his book 18 megabytes. On the other hand, neither Apple nor Barnes & Noble charge these fees for delivery to their e-book platforms.
And in response to the fees, Hyde has made an interesting move: he is selling a DRM-free Mobipocket version of the e-book on e-commerce site Gumroad, the same place he sells the DRM-free PDF version. Unlike Amazon, Gumroad only charges credit card fees, which work out to about 75 cents for the $10 e-book—Hyde keeps all the rest, including the 30% Amazon would have taken. And Amazon can “price match” it all they want and Hyde will still earn more money for sales made there. For authors who do their own promotion, it sounds like a great way to make a little extra money over what Amazon would pay you.
Apart from that, it’s also interesting that Hyde found the Nook made up only 1% of demand among those who expressed a preference during his Kickstarter, and 1% of actual sales afterward. (And a much larger percentage of people actually bought through Kindle than originally claimed to be interested in buying through Kindle.) For all that the publishing industry has claimed that Amazon’s market share has slipped since it implemented agency pricing, results like this make me wonder just how true that really is.
Amazon is downloading books over 3G without charging the user. Not too surprising that they’re getting that money elsewhere, and not too surprising that people who produce 18 MB books are paying more than people who produce <1 MB books. As Nate says, the charges were disclosed up front.
People who accept the lower 35% royalty that amazon offers do not pay this fee.
Great find with Gumroad, thanks. Looks like they do not accept Paypal though, that’s a bummer. Found a ton of similar services like this, including Sellfy, which accepts Paypal. Would be interesting to see how the conversion rates between the two services compare.