Draft2Digital lowering Smashwords royalty rates

[Lynn]

They give a complicated and kind of silly reason for why they're changing the royalty rates but what it amounts to is almost an across the board lowering of royalty rates at Smashwords.

Smashwords Store Simplifies Royalty Rates

For the first time in its nearly 18-year history, the Smashwords store will update its royalty rates.

Effective January 1, 2026, books priced under $2.99 will earn 40% list.

Books priced $2.99 and higher will earn 75% list, the highest among all major ebook retailers.

Since 2008, the Smashwords store paid royalties using a complicated formula that was based on the dollar amount of the shopping cart checkout rather than the price of the book. Smashwords is simplifying the rate structure so it's more transparent, predictable, and easier to understand. To view a summary of the rate structure at various price points, visit our Royalty Rates page.

What's next


There is no action you need to take. We?ll continue to pay the old Smashwords rates through the end of 2025. Beginning today, when you enter a digital book price for digital stores?in Step 4 of the ebook publishing process?you?ll see the new Smashwords royalties calculated in the ?Projected Royalties? column.


Happy publishing,
The Draft2Digital Team
 

http://draft2digital.com/blog/royalty-rates

[LilyBLily]

What were their royalty rates before? 75% sounds like a lot to me.

[djmills]

LilyBLily, the old Smashwords rates are at the bottom of the linked royalty-rates page.

I was expecting this once D2D took over. However, even with the lower rates, Smashwords store still has the best royalty rates out there, except for author's own store.

[Jeff Tanyard]

Those rates are better than what the competition offers.  I doubt Amazon would match them the way they did with Apple back in the day, but you never know.

[TimothyEllis]

Lowering?

I thought they were raising them.

[LilyBLily]

So if I put a wide book on Smashwords, they'd give me 75%? No 10% rake-off from D2D for their fee?

Somebody please remind me why I don't have any of my wide books on Smashwords. Wait. I remember. They had a notorious upload issue. What was it called? The grinder? Something like that. And if I recall correctly, they abandoned that awful technology some time ago.

Or maybe I'm just dreaming about 75%.

[Jeff Tanyard]

So if I put a wide book on Smashwords, they'd give me 75%? No 10% rake-off from D2D for their fee?

Somebody please remind me why I don't have any of my wide books on Smashwords. Wait. I remember. They had a notorious upload issue. What was it called? The grinder? Something like that. And if I recall correctly, they abandoned that awful technology some time ago.

Or maybe I'm just dreaming about 75%.

Meatgrinder.  That's what it was called.  But it's history now thanks to the merger.

Now you can just upload your book to D2D as usual and have it appear in the Smashwords store.

As for the royalty rates, both the new ones and the old ones are listed at the OP's link for comparison.

[Lynn]

.03 cent higher for a 2.99 book. And every price higher than that the royalty effective rate is lower. And then the 40% on anything priced below 2.99 now. They definitely did not raise royalties for most authors. If you're a rare one that is selling everything at 2.99, you'll get three US pennies more per sale than you did before. For everybody else, you're taking a hit. :D

[Bill Hiatt]

Perhaps it's an effort to encourage people, as Amazon does, to price at at least 2.99. In each case, the royalties are 5% higher than Amazon's, but obviously, 75% is much better than 40%.

I'm not currently wide, but if I were, I suppose the lower royalty would hurt during promotions, when I might drop below 2.99. Otherwise, the only things I regularly offer at below that are single short stories and one novella. I'm thinking of changing my price structure in any case, making prices in general higher, so that 2.99 would be the sale price. But I'm probably not going to do that until I'm sure the US isn't going into a recession.