Here is Amazon’s May 30, 2025, announcement: For the first time since starting print operations almost two decades ago, starting June 10, 2025, we are changing the royalty rate for books priced below certain list prices (e.g. less than 9.99 USD) from 60% to 50%.
I have been in and around publishing long enough to understand that printing and binding a book is not cheap. In the pre-POD (print on demand) days, printers and publishers were compelled to produce print runs as large as possible in order to reduce per-book costs to a level that they and their customers could handle.
Back when I was in the textbook publishing business (the 1980s), tiny changes in the commodity price of lumber (used to make paper) and manufactured paper caused great angst in the C-Suites of the major publishers. These same economics usually made it impossible for authors to self-publish because the print runs that printers demanded were way beyond what self-publishers could spend. We are thankful that POD technology made it possible for us to self-publish and Amazon to re-invent book selling. Note: The economic travails of the 70s and early 80s also sent US publishers as a rule to Asian printers, where labor costs were much less. This spelled the deaths of American companies and industries with long-standing stakes in book printing and binding. That’s another story.
I am impressed with how creatively Amazon configured the price increase. Lowering the commission rate for books priced below USD 9.99 is definitely a price increase for authors with books below that price level, but Amazon figured out how to give us a choice. When I received the first notice of the change, I dropped everything, logged into KDP, and raised the prices for all my books priced that were below USD 9.99 to that level. By acting fast, I was able to avoid losing any sales and avoided the lower royalty rate ahead.
When I raised my prices, I did not notice initially that there are new thresholds for most of Amazon’s non-US markets as well. So, I had to make a second pass and re-set prices for the UK, Canada, etc.
Take a quick look at this analysis of the costs of printing and binding a 200-page paperback book. Thirty-five to 45% of the total cost of printing and binding can come from paper and ink. A five ot ten percent increase (tariff or otherwise) will play havoc with the bottom line.
| Cost Component | Typical % of Total Cost |
|---|---|
| Paper | 25–30% |
| Ink | 10–15% |
| Labor | 15–20% |
| Binding | 10–15% |
| Overhead | 10–15% |
| Other (margin, packaging, etc.) | 10–15% |
But wait, there’s more.
It seems pretty transparent that Amazon bundled a cost reduction with their price increase to soften the blow.
…we are reducing color printing costs for paperbacks in some marketplaces to help authors adopt color printing…
Color printing generally requires better-grade (thicker, denser) paper than black-and-white printing to avoid “bleed-through” and ink dispersion effects that degrade image quality. This costs more. So, by lowering the cost, Amazon has either found a workaround or is able to handle reduced margins for color printing as compared with the margin increases that they will realize from the price increases described above.
Either way, I will re-think whether I have books that will benefit from color printing. Note that the cost reductions impact both standard and premium color jobs. At Touchwood Press, we’ll be looking at the viability of creating color versions of our 50 Fun Facts print books to match the color we can include in the eBook versions of those books for readers using phones or tablets.
