Pub Rants

If You Haven’t Got Anything Nice To Say…

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STATUS: Springtime in the Rockies! It was 65 degrees and sunny today and I must admit, I left the office at 2:30 in order to take Chutney out for a run and enjoy the day. In exchange, I’m working all evening.

What’s playing on the iPod right now? TOMORROW PEOPLE by Ziggy Marley and The Melody Makers

Come sit next to me!

Last week, I pretty much spent every entry talking about contracts but today’s discussion tops the cake.

Just recently, a publisher made an offer for the next books from one of my clients. Excellent. But this publisher is also one of the big 6 that have announced that they are moving to the agency commission model for the sale of electronic books.

As ya’ll know based on my math lecture about net receipts last week, there are some key questions that really need to be answered about electronic books and exactly what 25% of net is going to mean.

So my contracts manager and I insisted on talking to contracts director before closing the deal.

The publisher’s response (and this is a paraphrase): they have no idea what the definition of net receipts will be and feel uncomfortable accepting the language we have put forth. Their suggestion? If the author would like to put the contract on hold until the company makes a corporate decision on this, then the author is free to do so. However, the publisher has no timeline for when this will be resolved.

Snort. That’s the solution?

Publishers. The world is changing. Quit dithering. We agents have to negotiate contracts now so maybe get on this. Telling us we can just put it on hold until you get your act together isn’t an alternative.

Rant over.

34 Responses

  1. Anonymous said:

    How about telling them “if you can’t define your contract language properly, you can’t have any e-book rights at all” !

    ::Rolls eyes:: Why in the world would they think anyone will sign their contracts when they haven’t decided how the author payments will be calculated?

    Note to self: this is how agents earn their 15%

  2. Eridani said:

    I miss springtime in Colorado. I grew up in Pueblo and I now live in Ohio. Ohio is green and beautiful once spring gets sprung, but it doesn’t get actually nice until about May. 🙁

    I read a great, totally unbiased article about the pros, cons, and potential impact of the Google Books Settlement yesterday and it made me wonder what the compensation model they’re using is like compared to what Apple is offering. Considering that the publishers have utterly abdicated their responsibility for where the future of their industry is going, it’s no wonder they’re dithering – they have to wait for Apple and Google to set their digital book business model for them. Any decisions they make now are irrelevant in the face of what those two technology titans decide in the coming months.

    Speaking of Google Books, how does that work, contractually? I know authors can opt in or opt out, but how are you advising newbies to handle it? Do the publishers weigh in at all in that decision? I can imagine some might prohibit it and some might encourage it.

    Google Books Article:

  3. John M. Baron said:

    I suppose I understand where they’re coming from, though I don’t find it acceptable. Not at all.
    The publishers probably don’t want to accept your language because it will set a precedent, and they don’t want to get left behind when/if the other big houses settle on better terms. This is an incredibly bad/sad/maddening position (essentially a take it or leave it till sometime later — if ever) for you and your client. I’ll be interested to hear how this works out.

  4. Lisa Blandford said:

    Kristin, I just love how you can put the most important contract information in understandable terms for those of us that are contract language challenged. Thank you so much for taking such good care of your clients! You rock!

  5. Laurel said:

    Having spent most of my professional life working on commission I have to say: Uh-uh. No. No way. 25% of undefined/undisclosed is not cool.

    Give ’em hell.

  6. Anonymous said:

    I don’t deal with editorial agenda as much in my new position as I did in my old position. In my old position, I was on the front line of the company e-evolution strategy, and I can say without hesitation that the company was unprepared. Not just technologically but mentally. It was new, it was different, and it scared the hell out of them. The best way I could describe their mindset was, “I don’t understand this. I’m scared of this. Please tell me what I’m supposed to think so I can continue with my job without actually learning anything about this new paradigm in my profession.”

    The only publishers that scare me more than the ones that have no e-strategy are the ones that saw this and have prepared accordingly. Many of the positions they have maneuvered to have not been author friendly.

  7. Welshcake said:

    This is why authors need agents. Don’t leave home without one!

    There are probably unagented authors out there who have no idea they should be asking these sort of questions before signing.

  8. Jill said:

    Dither, wait, don’t decide, sit on the fence…? I cannot think of any other industry that would be a slow moving to adapt to change as publishing seems to be.

    Bright side: perhaps this is a blessing… still free to shop around since nothing has been signed yet.

  9. AstonWest said:

    Is it just me, or are the major publishers (with a move to royalties off net) trying to shift to a payment structure that more closely resembles POD publishers?

  10. Carl said:

    I think it’s discouraging and telling to learn that they are adopting a model that they haven’t even thought through yet, but there is another choice besides capitulating or punting.

    You can include a clause in the contract that states that if they provide any other author with a more favorable compensation formula regarding the agency model within a certain time frame, that formula must be retroactively applied to the author’s contract. There are all sorts of other clauses and contingencies that can be incorporated into the language that will allow the author to go forward, but not give up a more favorable formula that the publisher may apply in the future.

    Good luck!

  11. ICQB said:

    Hi Kristin,

    Your posts are always so informative, thanks so much. I’ve been absorbing a lot of your posts about contracts. I’ve been offered a book contract by a small, niche publisher for a short holiday book. I don’t have an agent and sort of think that it’d be hard to get one just for this small holiday book, so I’m extremely grateful for the wealth of information on your blog about these things.

    Thanks a million!

  12. Chantal said:

    I just want to say thank you for working so hard for your clients–and then sharing with the rest of the world what might be a potential issue for us if we’re not represented by you…you do us all a great service. THANK YOU.

  13. Sue said:

    That’s terrible- sounds like it’s a put off because they are annoyed at being put out by you making them do their job correctly.

  14. behlerblog said:

    Publishers. The world is changing. Quit dithering. We agents have to negotiate contracts now so maybe get on this. Telling us we can just put it on hold until you get your act together isn’t an alternative.

    Here here! Thing is, there is little incentive for Big McBox publisher to change because ‘he who has the most money writes the rules.’ They know you’ll wait.

    I will now go celebrate my smallness with a margarita.

  15. JEM said:

    And publishers wonder why they can’t get a grip on falling sales and lost profits? This particular situation must be so frustrating because it puts you and your author in a bad place: either accept bad terms on e-books or wait for an indefinite period of time (which may be never) for them to make up their mind, at which point neither one of you has seen any income from said book. Ridiculous. It will be nice when the day comes that the people who hold the power are not the slowest to act.

  16. M.J.Ware said:

    So what they are saying is sign a contract even though there’s no way to really understand the terms, or we won’t publish you?

    I have no law background, but it does seem possible that putting ambiguous terms in the contract purposefully, might invalidate that contract, or perhaps the eBook rights portion of it?

    Either way, it certainly stinks!

  17. Anonymous said:

    (Picking this up late from PL… )

    Most days lately, I get this awful feeling that the definition of net receipts is going to fall victim to the same expenses creep as net film receipts. And that makes me want to reach for the bourbon, and it’s not even noon.

  18. Anonymous said:

    Why is the assumption that publishers are trying to pull a fast one on authors and agents? The people forcing change and demanding terms are the e-book retailers. Just as agents are protecting their authors by putting up stop signs and saying we need to figure this out, publishers are putting up stop signs to the e-book vendors to protect both the publishers and the authors. That’s why it’s taking some time to figure this out.

  19. Anonymous said:

    Anonymous 1 to Anonymous 2:

    “Why is the assumption that publishers are trying to pull a fast one on authors and agents?”

    For those not in publishing, moves by houses to claim licenses to ebooks from existing contracts that wouldn’t properly compensate authors make a lasting impression.

    For those in publishing, I can assure you we were discussing revised strategy to accommodate the growing ebook market long before there was a kindle or an ipad.

    Goal 1: Create a mode that prevents resale and eliminate the used book.

    Goal 2: Encourage the belief that the ebook is a supplement to the printed text. Authors should think of them as “extras” or “throw aways” for a niche market. Secure long-term rights for low royalties.

    Publishers don’t want to totally screw authors. Without authors, there are no publishers. But there has been a growing sense of publishing royalties as secondary income among the editorial teams I’ve worked with. The author is assumed to have a full time job that pays the bills and writing royalties is bonus/fun money. Thus reducing their royalties is okay because you’re not jeopardizing anyone’s livelihood. Those authors that are large enough sellers to make a living off their publications are also important enough to make greater demands, and thus are an exception to said mindset. As an exception, it creates two identifiable groups: Money Makers and Everyone Else. If Everyone Else wants to get paid better, they should sell more.

    Certainly this paints the publisher as villain with a mustache to be twirled and that might be an unfair description of many houses out there that act more ethically than others. But in the end, it’s all business and houses can only do two things to generate money, sell and cut costs. It’s much easier to cut costs by reducing author royalties than it is to renegotiate with sellers.

  20. Anonymous said:

    This does not surprise me at all! I love the publishing business, but it isn’t known for quick innovation/change. I’ve been on the other side of the deal negotiating contracts as an editor, and there are times when you have to wait for higher ups to make the big decisions, not that that is an excuse – just the way it works.

    Love your perspective Kristen! Keep up the great work.

  21. Liesl said:

    Eesh! That’s tough. On one hand, you want to sell the book for your client, on the other hand, you want to get them what is fair. Vague usually never works to the contract signer’s advantage. How will you handle this?

  22. Anonymous said:

    I still think that somehow the e-book vendors are avoiding examination here. But they’re the ones demanding that a $26 hardcover book be priced at half that amount. So then do the math using the current (non-agency) royalty model: on a $13 e-book the e-bookseller gets half, leaving $6.50 for publisher/author. On the print book at 15%, the author got almost $4. So take away $4 from $6.50 and the publisher is left with $2.50 a book. You can’t sustain a business on that. It won’t be long before there are no publishers left to pay advances if we use that model. I’m not disputing that some people will use this moment as an opportunity to squeeze other players in this business, but we have to remember who the prime mover in this most recent episode is.

  23. mkcbunny said:

    I get that it may take time to sort out the e-rights issue, but how it sounds like the author is supposed to sign a contract with undefined terms for payment? What is the point of having a contract clause at all if it’s that wiggly?

  24. Anonymous said:

    This is one of those examples that makes me want to self-publish. Yeah, I know that it’s a nasty word, but from everything I have been reading, the big publishers are acting the music business did 10 years ago: clueless. Time to just setup up my own publishing company, outsource my editing, and publish directly to the Kindle and Nook. Just tell me when these big companies get a clue, so I can do the whole query thingy.

  25. Anonymous said:

    It sounds to me as if they were saying that if you want to sell books to them it is a take it or leave it scenario.

  26. Deb said:

    One tack might be to say to the publisher, “All right — if you don’t know what net is going to be, we’ll just settle for 25% of cover.”

    Bet that’d get them doing the math before long.