ROYALTIES. Payment by royalties based on a percentage of the published price has now become the customary method of sharing receipts between publisher and author from sales of a book. The amount of royalty agreed upon depends on the cost (including advertising) and the estimated sale of the book, as well as on the respective bargaining powers of publisher and author. British publishers are accustomed to contracts calling for payment to the author of 1 o% of the original published price —usually 7/6d.—of a novel by a new author, with provision that the royalty shall rise by agreed-upon stages to 15 or 20%. The successful British author whose sales are already established ordinarily gets a percentage beginning at 15 or 20, and rising to 25 after a sale of from io,000 to 20,000 at the original price. The royalties on non-fiction books published at higher prices are as a rule somewhat higher than the royalties on novels.
Most British contracts for fiction now contain a provision for publication in cheaper form after the sales at the original published price have ceased. Royalties on these cheap editions range from a farthing a copy on sixpenny editions to io% on 2/6d. editions.
Another phase of royalties is the advance. When it became apparent that the royalty system was fairer to publisher and author than the old system of payment outright for all rights, the author was prompt to point out that he might starve while waiting for his money—hence the publishers' custom of paying an advance on account of royalties on the day of publication. Authors whose previous sales had been large commanded pro portionately large advances.
In the United States, where costs of distribution and advertising are greater than in the British Isles, royalties are lower. Whereas 2o% was not uncommon for a successful writer, 15% is now the rule, though 2o% after a sale of io,000 at the original price in America is not unknown, despite the declaration of most of the American publishers that they cannot now go above 15%. The tendency is to begin at ro% of the advertised price, rising to 121% or 15% after a sale of 5,00o copies at the.. original price.
When advances are paid to the author before any royalties are earned they are customarily made (a) upon the signing of the agreement, (b) upon delivery of the complete manuscript ready for publication and (c) on the publication date.
It is not the general custom of American publishers to bring out cheap editions of their own novels, though more publishers are bringing out these cheaper editions than ever before. The more usual practice is to sell the cheap edition rights, when possible, to firms who specialize in such editions, the original publisher pro viding the plates and giving the author half of the royalties, which usually yields to the author a royalty of 5% of the published price of the cheap edition.
As regards royalties on the Continent, it is only within recent years that this system of payment has been generally adopted, and even yet in some of the central European countries and in Holland it is only for particularly important books that royalties can be obtained. As a rule the percentages are lower than those prevailing in England. In Germany and Austria the royalty is not paid on the retail published price but on the "Broschiert," that is to say, on the retail price to the bookseller of the stitched and unbound copy.
A compromise between the percentage royalty on the retail price of every copy sold and the outright payment for the copy right has now been extensively adopted by foreign publishers ; the system being the payment of an outright sum for every i,000 copies printed. The advance on such payment usually covers the number of copies printed in the first edition.