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Amazon to Increase Publisher Revenue Share on Kindle to 70 Percent

Retailer takes a smaller revenue cut but sets qualification terms.



By Jason Fell
11/09/2010

While publishers continue to complain about the revenue model of some tablet devices like Apple’s iPad, those that distribute their magazines and newspapers on Amazon’s Kindle are about to see a significant revenue bump. Amazon says starting December 1 it will increase the revenue split so that publishers can earn 70 percent of the retail price for each issue sold in the Kindle Store, minus delivery costs. That’s a reversal from Amazon keeping as much as 70 percent of retail revenues.

To qualify for the 70 percent royalty terms, publishers must ensure that their digital editions can be downloaded to all Kindle devices and applications for the iPhone and PCs, and that readers can access the content in any region where the publisher has rights.

Blog publishers on the Kindle will continue to earn only 30 percent of gross revenue, Amazon says.

According to Amazon, delivery costs for U.S.-based publishers is $0.15 per megabyte (MB). File sizes, obviously, vary depending on how much rich content is contained in each issue. Therefore, if a monthly publication’s retail cost is $9.99, and it delivers at 1 MB per month/issue, a publisher would earn roughly $6.89.

Amazon says the file size of a typical magazine with 30 articles and 20 to 25 images ranges between 1 and 1.5 MB.

At the same time, Amazon says it has release the beta version of the Kindle Publishing for Periodicals tool, which it says allows publishers to create an account, add content and preview Kindle formatting prior to adding their publications to the Kindle Store. Click here for more information.

By Jason Fell
11/09/2010







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