New Macmillan eBook royalty rate = old royalty rate for other publishers

E-Reads.com is reporting that Macmillan is proposing a eBook royalty rate of 20-25% of net receipts, which really isn't "new" so as much as "new to Macmillan" and would bring them inline with an already common 25% mark.

In MY greatly uninformed opinion (being published in a magazine once hardly makes me an author), if a contract is based on gross receipts, and a eBook saves $1 to $2 in printing costs versus a hardcover, then an author is automatically entitled to ask for $1 to $2 more per sale, or at least a portion of that amount (split the difference).

If an author is paid on NET, you have a different problem. The agency deal means less money for all if the terms of the sale are based on net. 30% of a $15 eBook is $4.50, and if you get 25% of net as an author you're due a buck and change. If you get a mere 10% of a $25 hardcover, that's worth more than double.

So clearly, there's a lot of negotiation left. Publishers don't want to leave too much on the table, but authors are going to want food on their table.