STATUS: It can stop snowing now…
What’s playing on the iPod right now? I’D RATHER BE WITH YOU by Joshua Radin
I first caught wind of the contract changes from Macmillan via Richard Curtis’s blog about the changes they want to try for in e-royalties.
Oh boy, here we go again. Great, a battle because a publisher wants to do LOWER than that 25% of net that publishers as of late have been trying to push as “standard.” I long for the Random House days of 25% of retail…)
Then Publishers Lunch had a note about it, thank goodness.
Macmillan had sent a letter out to agents regarding the changes but for some reason, I, and just about every other agent I know (and folks that’s a lot), had not received this letter despite all of us having numerous clients with the Macmillan Group.
Small oversight I’m sure. When I emailed their contracts director, she mentioned that the letter was going out in waves to agents as their email list was long. Okay, fine. I’m a little annoyed but when I asked for the change letter and the sample of new contracts, it was sent immediately.
So now I’m in the process of reviewing. Macmillan had planned on implementing these new contracts on Nov. 9. Today I got an email that agents can respond until January 4, 2010. Good to know.
And first off I want to give Macmillan kudos for being totally upfront about the changes they want to do. Unlike, cough cough, Simon & Schuster last summer with their out of print clause and, cough, cough, Penguin Group with clause 9.ii.b. back in March.
So they are least being transparent but if the e-royalties are any indication of things they want changed, it looks like more contract battles ahead…
So basically less money to the authors and more to the Publishers.
…the more posts I read about the industry, the more I want nothing to do with it.
And according to Publishers Lunch, it’s 20% across the board, rights and licence sales. That’d be a significant drop in licence sales which are hovering at 50%.
Interesting that they said they’d notified agents when they hadn’t.
Sometimes these pricing battles are beyond dizzying…
So what response can agents give until Jan. 2010? Can you dispute?
Worrisome…
The person who needs a relationship less has the most power in it–and can dictate all the terms.
I love the way the publisher is demanding that writers take less money for a format of book that costs almost nothing to produce.
But here’s the big question? Can an agent do anything about it? No. All they can do is sell the changes to their writers.
The one who needs the relationship less has the most power in it.
Um, I just want to comment that I love Joshua Radin. Everything he does. Good music pick for the day. The rest makes my head spin.
Maybe writers and agents should just start blowing off MacMillan. This is the equivalent of the music industry back in the Napster battle days wanting to charge as much for digital music as it had been for CDs – never mind that the government finally determined that CDs were way overpriced & they were forced to bring them down.
As a writer I wouldn’t want this sort of a deal. Considering how much the publishers are hurting, I think writers & agents have more power than they realize.
How prophetic. I was just commenting on publishers making this attempt on Pimp My Novel. It’s an opportune time for publishers to do so. They know where the market is moving, but the total percentage of revenue off of ebooks is still low. They can claim how they have to do it to survive, being at the whim of Amazon and a changing marketplace that requires reinvestment. And perhaps they think they do. The publisher/retailer paradigm will have to change for publishers to remain solvent once ebooks become market dominant, but they can’t begin implementing that structure now without invoking Amazon’s wrath. A tenuous situation, to be certain.
But publishing doesn’t adjust quickly or change easily. Once a line is drawn for the “standard” of e-revenues (and 20% won’t be the cellar; some publisher will be ballsy enough to try 15%), that standard will be used even when ebooks pass 50% market share (or when e-only releases become viable). They say it’s necessary now, but the author will get it in the end.
Anon 4:06 said, “the more posts I read about the industry, the more I want nothing to do with it.”
Un huh… That’s easy to say when they don’t want anything to do with you.
Big publishing isn’t the enemy, people. Amazon, B&N, Walmart, and Target are the enemy.
Publishing aside, if you like to read, these examples are the evil ones you should fight against.
I think J. Selby summed it up perfectly – in any industry if you see you can establish a high rate (or lower royalty) on something that might be huge in 3-5 years, then you have to jump at it.
What would people think of a “total return” type of royalty? i.e., you agree that the author get’s X% of the profit on all types of sales instead of making it vary for each type of media?
As someone in the process of starting an independent publishing company, I would like to bring up one of the issues small publishers face with regards to electronic books.
I believe that eBooks should be priced lower than the associated pBook. This takes into account the fact that consumers expect the price to be lower because there are no costs associated with printing and shipping. One must remember however, that production costs for electronic books are not zero. There are still one time costs (such as typesetting and cover design) which must be incurred regardless of the format of a book.
Consider an electronic book with a list price of $5. Amazon will pay a small publisher 35% of list for the Kindle edition. 35% of list on the eBook priced at $5 gives a net of $1.75 per book. 25% of list (the royalty suggested by this blogs author) is $1.25 per book. While I do agree that 20% of net is too low, I also think that 71% of net ($1.25 on a net of $1.75) is too high.
I was considering something similar to what Cam Snow had suggested for my contracts – a profit sharing arrangement where the authors would get a percentage of the profit regardless of format. However, one must remember that “profit” is an arbitrary term that can be defined in a number of ways. For a contract to be meaningful, the computation of costs which would be deducted from net revenues to compute profits would needs to be defined completely. As I continue to research this topic, I’m coming to the conclusion that the author of this blog is correct that royalties should be based on list price, if only for ease of tracking and computation.
One final point – I have found many of the discussions in this blog to be incredibly useful as I develop my own business plan. Thank you for sharing your thought.