From the Edmonton Journal, here’s part of the interview with Greg Hollingshead, chairman of the Writers’ Union of Canada:
Q: One of the Writers’ Union’s proposals is that the publisher split proceeds of e-book sales equally with the author. So, are you proposing a royalty rate of 50 per cent? Do you think this is feasible?
A: The traditional 15 per cent of the list price of a hardcover book is derived, approximately, from an understanding that the publisher and author share the net proceeds 50 per cent. (Roughly, if 70 per cent of the cost of books pays for its production, that leaves 30 per cent to be split 50-50 between publisher and author, i.e. 15 per cent of list for the author). This (50 per cent) is the rate Random House began by offering authors for e-books but then cut back. It seems to us that with minimum production costs and virtually no return costs, e-books are not as expensive for the publisher to produce as hardcover books, and yet the industry standard remains around 25 per cent of net (not list, notice!).
If there is a reason for a rate so low, perhaps publishers could open their books or otherwise explain their position. Our concern is that if publishers stand to make relatively greater profit on e-books, then that is where their promotional budget will go, and their hardcover print runs will be shorter, in favour of digital availability. The author will then lose doubly, and triply.
There is a directional aspect to our per cent. Perhaps, if there is something “unfeasible” about it now – something to do, say, with startup costs to publishers (though they never took their original conversion to computers out of authors’ revenues), it is a rate that could be reached within a few years, moving from 35 per cent, to 40 per cent, etc. or after sales of a title reach a certain number (the way hardcover royalty rates can escalate with sales).