Why two rates? They're based mostly on how much you charge for your book. To get the 70 percent deal, your book has to be priced between $2.99 and $9.99; you can go down to 99 cents, or up to $200 with the 35 percent rate. (There are also some restrictions based on the size of the downloadable eBook file.) Barnes & Noble rates are 65 percent for the $2.99 to $9.99 tier and 40 percent for those priced in the 99 cents to $199.99 range. As for Smashwords, they pay an 85 percent royalty on books sold directly through their own site, and 60 percent for books sold through another distributor.
So, what's needed to break into the glamorous world of self-publishing? A book manuscript is a good start. Keep in mind that graphics-intensive books don't work as well in digital form as they do on paper. You don't have a lot of control over the layout of your eBook – not only do the screen sizes vary, but the reader can actually adjust the size of the type, which completely changes the formatting. Also, many of your readers will be looking at a black-and-white rather than color screen.
Microsoft Word is the standard for creating, and often submitting, your manuscript. It's worth mastering Word's Styles system to format your work. For example, instead of hitting the Tab key to indent a paragraph, use a style that automatically indents for you. Instead of manually making headings or subheadings larger and bolder, use styles for that too. This has several benefits. It makes your work look consistent, and helps the software that will ultimately convert the manuscript into eBook format do a better job with the spacing. Also, if you want to include a table of contents, Word styles can automate the process.