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Why are ebook royalties calculated from “net revenue”?

April 26, 2017calculated ebook net revenue royalties

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Why are ebook royalties calculated from “net revenue”?

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Since ebooks have practically no production costs, it might seem strange that royalties are based on net revenue and not on cover price. The reason for this is simple: distribution channels. GPP’s ebooks will be sold not only through this site, but through third-party channels that take their cut off the cover price. That, combined with the fact that commission percentage changes from channel to channel, makes net revenue the only practical calculation for ebook royalties.