The two biggest ebook distributors are Amazon Kindle and Smashwords. Here are the more important differences:
Amazon Kindle publishes ebooks exclusively for Amazon. Ebooks will be sold only in Amazon stores worldwide.
Smashwords will distribute your ebooks to Apple iBookstore, Barnes and Nobles’ Nook, Kobo and Scribd.
Amazon Kindle requires formatting ebooks to be readable in Kindle apps. Kindle apps are available to download for free for Windows, Mac, Android, iPhone and iPad. So you have to have the Kindle app to read Kindle ebooks.
Smashwords has different formatting, but readers can have a choice to download the ebook as a Kindle ebook, ePub, plain text, and PDF. So readers don’t have to be forced to install a particular app to read the ebook.
Amazon pays out royalties of 35% if the ebook is within the price range of $0.99 to $2.99; 70% if price is above $2.99.
Smashwords pays out royalties from 45%-80% depending on the bookstore where the ebook is bought. It’s 80% if the ebook is bought from the Smashwords site.
Amazon has the KDP Select, which has two promotional tools: Kindle Countdown Deals, time-bound promotional discounting for your book while earning royalties; or Free Book Promotion where readers worldwide can get your book free for a limited time. KDP Select also pays out royalties when customers read your books from Kindle Unlimited and the Kindle Owners’ Lending Library. You can enroll your ebook in KDP Select for a minimum of 3 months, but it gives Amazon exclusive distribution rights over your ebook. In others words, while your ebook is enrolled in KDP Select, you cannot submit your ebook to other ebook distributors.
Smashwords offers a free ebook on successfully marketing your ebook. It contains 41 excellent marketing tips.
5. Royalty payouts
Amazon claims it sends royalty payments via direct deposit to over 40 countries; but when you click on the link to the list of these countries, there are only 10 countries listed. If your country isn’t listed, they pay in dollar cheque when royalties reach a threshold of $100 and after an accounting of 60 days. For authors outside of the listed countries, it can take months before you are able to see your royalties in your own currency.
On the other hand —and this is the main reason why I prefer Smashwords— Smashwords pays royalties via PayPal every month regardless of how much you’ve earned. So long as its above $0.01, they’ll pay you.
Both Amazon Kindle and Smashwords allow you to submit your ebooks for free.