What's the average price for an eBook bestseller?

About $7. That's the average price for an eBook bestseller. (Click here for the specifics at Digital Book World)

It's an important number for two reasons. First, it tells publishers (big and small) about what readers are willing to pay for an eBook. Second, it gives guidance to all the self-publishers out there about realistic expectations around royalties and sales numbers.

What readers are willing to pay

It's been a few years now that eBooks are relatively commonplace. About 20 million e-readers have been sold each of the past few years. Then there are millions more tablets that people buy and use to read eBooks. A recent study says that about 1 in 4 people owns an e-reader or a tablet, so we're probably looking at 50 million or so people who are actively buying and reading eBooks.

And the average those readers are willing to pay for a bestselling eBook is $7.

Realistic expectations

If you're an author at one of the Big Six, you probably get about 25 percent of the eBook sale price. So that's $1.75 per eBook sold at $7. If you're a self-publisher, you get either 35 percent or 70 percent, depending on what option you take through Amazon. So that would be either $2.45 or $4.90, respectively.

In a very rough way, this means that to make $50,000 a year, before taxes, an author would need to sell 20,000 copies a year at $2.50 royalty on a $7 book. That's a decent rough average but by no means a definitive number. For authors it means you need several successful books to have a good year, or you need other work in addition to writing books. For big publishers it means they need dozens or hundreds of titles selling tens of thousands of copies a year to cover the cost of being an agency. It's a tough market.

What do you all think about this average price and what it means for big and self- publishers?

Image courtesy of NASA Goddard Space Flight Sentence via flickr