How do Publishing Royalties Work?

You've just finished writing what you think could be the next best seller. You've hired an experienced Entertainment Lawyer specializing in publishing contracts and want to know how you'll get paid and what you can expect in terms of how much you'll get paid. Some of this depends on how you negotiate your contract with your publisher, but some things are a little more defined. Some basic information about publishing royalties will be explained the following paragraphs.

If a publisher buys the rights to publish your book, typically an arrangement is made where a royalty payment of 5% to 15% of the publishers' wholesale price is given to the author. In this arrangement, all the author has to do is write the content. The publisher is responsible for the costs to produce the book which include editing, design, typesetting, printing, binding, advertising and marketing the book. Oftentimes in this arrangement, payment will go directly to your manager, agent, or Entertainment Lawyer, who will then take their cut, and then issue you the remainder of the payout.

With this type of royalty payment system, it is also common to see various 'steps” in which the amount of your royalties can escalate depending on how many books you sell. Blocks of 5000 books, 10,000 books, and 150,000 books are typical, meaning if you sell 5000 books you get a certain percentage of profit and earn more when you hit 10,000 books and so forth. It will also be dependent on whether or not your book is a hardback or paperback.

Most publishers also have particular times of year when they pay their contracted authors. Units sold from the first of the year to June 30th are paid out in November; Units sold July 1st to the end of the year are paid out in May. It is very typical for an author to not receive any royalties for upwards of a year after a book has been published due to these pay schedules.

Regardless of how many books you sell, the right Entertainment Lawyer will negotiate on your behalf to ensure you get the terms that best suite your needs in your contract with your publisher.