If you publish with Kindle Direct Publishing (KDP), do you understand the royalty structure for Kindle ebooks? There is an Amazon downloads charge.
When a reader buys one of your ebooks, Amazon deducts a small amount from your royalties for delivery.
You probably never noticed, but there is a deduction on every sale.
However, if you have a lot of images in your ebook, you could have a considerable reduction in your KDP royalties.
The Amazon digital downloads charge
Hidden deep in Amazon KDP Terms and Conditions is a table of the Amazon digital services charge for Kindle ebooks.
So deep that the breadcrumb to the Amazon digital downloads charge looks like this:
Kindle Direct Publishing > Legal > Kindle Direct Publishing > Terms and Conditions > Pricing Page.
Here is the list of Amazon digital delivery charges for ebook distribution.
Most authors are probably unaware of this and don’t know that the file size of an ebook can cut into their KDP royalty payment from Amazon.
Here is the table Amazon provides.
Delivery Costs are equal to the number of megabytes we determine your Digital Book file contains, multiplied by the Delivery Cost rate listed below.
Amazon.com: US $0.15/MB
Amazon.ca: CAD $0.15/MB
Amazon.co.uk: UK £0.10/MB
Amazon.in: INR ₹7/MB
Amazon.com.mx: MXN $1/MB
Amazon.com.au: AUD $0.15/MB
It might only look like pennies at first glance.
But once you understand that even a plain text-only ebook with a standard resolution cover design will usually be around 2.00MB in size, the file delivery costs in the above table immediately double.
If your cover image is very high-resolution, your ebook file size will increase dramatically.
If the list price for your ebook is $2.99 and you are on the 70% royalty rate, you might think your royalty will be $2.09.
But it will only be $1.89 for a 2MB ebook file size after the $0.30 Amazon downloads charge has been deducted.
But that is only the beginning of the story.
Go easy on images in Kindle ebooks
Once you start adding images to an ebook, the file size of your ebook will increase rapidly.
But it depends on which royalty level you select when you publish.
So much so that if the file size reaches 10MB, your royalty will be less at 70% ($1.04) than at 35% ($1.05).
It is because Amazon does not charge delivery costs on digital orders if you select the 35% royalty rate.
As far as I can ascertain, only Amazon charges for ebook delivery. It may have something to do with delivering to Kindle devices, but I don’t know why.
Other retailers manage to deliver ebooks without any additional charges at all.
To check the file size of your ebooks on Amazon, go to your book page and check your product details.
It is the first item, and it will be listed in KB. 1,000KB equals 1MB.
You can see how quickly a few large images can affect your KDP ebook royalty.
If you want to avoid losing money, you should ensure that any images you use in your ebook are compressed to the smallest size possible.
We have an article explaining how to compress images for ebooks that will help you to reduce your images considerably.
You can earn a minus ebook royalty
Here’s a not-so-pleasant statistic about your Kindle royalties to finish.
If your ebook retail price is $2.99 on KDP’s 70% royalty rate, and it is loaded with images and reaches 20MB in size, your royalty with be -$0.01 for every book sold.
Yes, your images and Amazon’s delivery charge will wipe out all of your book sales earnings and Amazon royalties.
You will earn less than nothing from every ebook you sell.
But if you choose the 35% royalty option, you will make $1.05.
In fact, your ebook file size can be as large as you like at 35% because no delivery fee is charged.
However, if you publish on Apple, Nook, Kobo, or Google Play, the size of your ebook file will not affect your royalty return.
As with all things self-publishing, nothing is ever plain and simple.
To solve the problem, my advice to those publishing ebooks with many images would be to consider using either Draft2Digital or Smashwords to publish your ebook.
You will earn much fairer and higher royalties for an ebook with a lot of images.
The other alternative is to publish a POD print book version and be sure that you will earn your expected royalty when you sell a copy of your book.
The only good news is if you enrolled in KDP Select and your ebooks are available on Kindle Unlimited in the Kindle Store.
As far as I can gather, there is (probably) no delivery fee for subscriber reading.
Related reading: Is Kindle Unlimited Worthwhile For Self-Publishing Authors?