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Comment by klodolph | Hacker News Reader

Amazon pays a 70% royalty for ebooks that were published directly by the author. Is it unfair for this royalty to be so large?

(I realize that this is more complicated than "70%", see https://kdp.amazon.com/self-publishing/help?topicId=A29FL26O...)

I think it's a sign of efficiency that a large portion of the money goes to content creators. Content creation will get cheaper as technology improves, sure, but in fields like music and writing, content creators struggle to make a decent wage. Therefore as content distribution technology improves, the percentage of money given to content creators should increase.

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> Content creation will get cheaper as technology improves, sure, but in fields like music and writing, content creators struggle to make a decent wage.

As well they should--it's an ultra-competitive field, swarming with competitors, the market is so flooded it makes New Orleans after Katrina look like a kiddie pool. Unless you're the cream of the cream of the crop, you're going to struggle in this industry. And not one of the content creators has an inherent 'right' to make a profit from their work. The market decides winners and losers, and inevitably in this market it's going to be mostly losers. Whether or not it's 'fair' is irrelevant, life isn't fair.

> And not one of the content creators has an inherent 'right' to make a profit from their work.

Agreed.

> The market decides winners and losers, and inevitably in this market it's going to be mostly losers.

But the problem is that royalty rates are decided by law, rather than by negotiation between interested parties. This isn't a market economy, this is a planned economy.

> But the problem is that royalty rates are decided by law, rather than by negotiation between interested parties. This isn't a market economy, this is a planned economy.

Those are the breaks. Copyright itself isn't a market economy, it's a "temporary" monopoly that's granted by the people and it comes with stipulations. The royalty rates perhaps aren't what the content creators would like them to be, but complaining about that when the term lengths for copyright are so outrageously generous just smacks of greed. For most working people, you get paid for your work once, and not for the rest of your life plus an additional 70 years.

> The royalty rates perhaps aren't what the content creators would like them to be, but complaining about that when the term lengths for copyright are so outrageously generous just smacks of greed. For most working people, you get paid for your work once, and not for the rest of your life plus an additional 70 years.

This is a non-sequitur. "Musicians are paid royalties for the rest of their life plus 70 years, therefore they should not complain about how large the royalties are." Obviously if our top musicians earned $10 over a 120 year period they would rightly complain about wages. Also obvious is that a $2 million per year royalty due for a song whose composers died nearly 100 years ago is excessive and wrong.

What is not clear is how to pay musicians. Since you seem to care about this problem, suggest something.

I don't have the answers. I'm just pointing out that writing, recording, and selling music doesn't entitle one to profits, and if you're in a saturated market like the music business you should expect that you're probably going to fail in your business ventures there unless you're in the top 0.1%. Perhaps the answer is for musicians to lower their expectations about making a business out of their art, because even with the system working as designed most of them already operate at a net loss.

Apples and oranges. Amazon - a customer pays them money - 30% net margin Pandora - ad-based revenue

On what basis do you believe as content distribution technology improves, the percentage given to content creators will increase? This is in direct contrast to historical examples such as monopolies and amazon clearly wants to become a near-monopoly; further, even if the percentage increases, if the absolute amounts fall the content creators still end up worse off. See eg recent articles on HN about the economics of movies being damaged by the move from dvd purchase to $4 or $5 digital rentals.

Go read that article again. That article talks about how content creators needed a ~10% profit margin to survive. The introduction of DVDs meant that half of that profit moved into long-term DVD sales, so studios decreased short-term margins and made bets on long term gains. When digital distribution took profits from DVDs, content creators were suddenly running at ~5% margins because the long-term bet had flopped. Or, in summary, we are in the middle of a market correction.

I don't know much about the movie business, and I'm not sure about my predictions. But I wouldn't want to draw conclusions by narrowing my focus to big-budget Hollywood movies with traditional distribution models, especially if the newer content distribution technologies are disrupting that model.

I also wasn't trying to make a statement about absolute amounts.

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