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Bulletin Board: E-book Terms of Sale

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Bulletin Board

E-book Terms of Sale

September 2012

 

We’re perplexed about e-book terms, and I’m hoping some of you can provide insights.

We publish mostly children’s picture books. Now that full-color platforms (i.e., iPad, Kindle Fire, NOOK Color, etc.) are widely available and we can use fixed-format display to keep illustrations and text constant, we are converting our titles to e-books. But we’re discovering that different vendors want vastly different terms, and we’re trying to sort it all out.

When we sell print books, we use our well-established discount schedules, which differ for classes of buyers. We have one discount schedule for retailers, another for trade wholesalers, and so on, in compliance with the Robinson-Patman Act.

But when we set up agreements with e-book vendors, they usually set the terms, and the standard contracts they have seem to be all over the place. I haven’t figured out any logic to them.

Unlike terms for selling print books, which are stated as a percentage discount off list price that the bookseller gets, terms for e-books are usually stated in terms of a percentage of list price that the bookseller pays the publisher.

Some e-book vendors function as distributors—Baker & Taylor, Ingram, and Follett, for example. Others—such as Amazon, Barnes & Noble.com, Apple, and Google Books—sell to end users. But that difference doesn’t seem to be reflected in the terms.

Among the companies that sell retail (to end users), Apple gives the publisher 70 percent; Amazon KDP gives 70 percent minus a download fee; Google Books gives 52 percent; B&N gives 50 percent; DedicatedTeacher.com gives 45 percent.

Among the companies that function as distributors, Follett gives 50 percent; Ingram gives retailers a 40 percent discount and takes 15 percent, which comes out to about 50 percent, plus it charges a one-time fee of $150 and an annual fee of $30 per title.

Baker & Taylor and Bilbary negotiate terms, but we have not had discussions with either of them at this point. I don’t yet know what Overdrive does.

When I talked with a representative from Google Books, he said that although 52 percent is standard in its contracts, Google will consider our terms as long as they are consistent for similar vendors under Robinson-Patman requirements. But he indicated that Google Books would not accept Amazon’s standard terms.

Sorting all this out is quite confusing. Any advice? I sure would appreciate observations and thoughts derived from experience.

 

Glenn Hovemann

Dawn Publications

dawnpub.com

glenn@dawnpub.com

530/274-7775

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