Major Publishers and the No-Advance Digital Model: Thanks, but No Thanks
From romance author Jackie Barbosa:
It can’t have escaped too many authors’ notice that most of the major publishers are opening digital-first/only romance lines. Harlequin was first out of the gate with Carina Press, but now we have Avon jumping into the game with Avon Impulse and Random House with Loveswept. I’m sure the other major houses can’t be far behind. There’s a lot to be said for the digital first/only publishing model in this age of shrinking shelf space and expanding digital book sales. Why shell out for a print run when orders for print books are declining and you may even take a bath on the book if one of the big boxes (Walmart or Target) decides not to stock it?
. . . .
But there’s a catch, and it’s a big one, in my opinion. With the exception of Carina, it appears that these new digital lines being created by the major publishers are picking up books and authors for these new lines with no advances and a royalty rate of 25% of net. (The royalty rate sometimes steps up to as much as 50% of net after a certain number of sales, but these sales numbers are usually in the 10,000+ range.)
Now, 25% of net is pretty standard when you sign with a major publishing house, but usually, you’re getting that lower rate in exchange for print exposure AND an advance. The publisher is making a significant upfront investment and taking the lion’s share of the risk in traditional print deals, both because they’re giving the author a guaranteed minimum royalty payment in the form of the advance and investing in the print run and print distribution, not to mention the possibility of returns. From a business perspective, it’s reasonable for an author to take relatively low royalties in exchange for a guarantee that, even if the book tanks, he/she will never receive less in payment than the advance.
. . . .
Let’s see if I have this straight, shall we? You are not going to pay me an advance for my book, so you are not going to guarantee me a minimum payment. In addition, you won’t be investing in a print run or physical distribution for my book, thereby significantly cutting your production costs. But, because you are (Insert Big 6 Publisher Name Here), I should be happy to accept the exact same royalty rate for my books as authors who are getting both of the benefits? Hmmmm, forgive me if I’m not impressed.
And here’s the real kicker–the way I see it, within five years, most romance will be published as digital first. If print is available, it will probably be POD. And this will be true of books put out by the Big 6 publishers. Unless a book is “big enough” to be stocked in Walmart/Target, it’s not going to HAVE a print run. That’s just the reality of what’s happening to the book market.
Link to the rest at Jackie Barbosa and thanks to tip-machine Jenny for the tip.
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Sometimes you just have to keep pushing boundaries to see where the breaking point is. A lot of authors (the ones defending the current indefensible publishing practices) are obviously already beaten down into a subservient position. Why not see how far they can push them?
Welcome to the era of vanity trade publishing…
So. For taking 25% instead of 70% (or even 35%), I get copyediting and a cover. Meanwhile, if I am willing to pay a flat fee for copyediting and a cover (or if I’m handy with an image-generating application…), I can get at least 35% for the same book, and probably the same marketing.
BUH-BYE, PUBLISHER! Write when you’re gonna offer at least 50% royalties and stand behind your authors! (I think better of Open Road, for example, for dealing with a FaceBook fan-page complication for one of their authors. Dealing with FaceBook probably deserves hazard pay!)
I’m not as familiar with the Romance market, but this feels like a situation where the publisher is offering the exact same service as what you can do for yourself with a bit of effort. Either way, the ebook’s going to be sold on Amazon, B&N, etc. Why have a publisher do it for you?
Because of the ‘stigma’ of self-publishing still lingering in some corners – and because self-pubbing IS still work. It’s “hard.” And the full responsibility of success or failure rests on your own shoulders. That scares the crap out of a lot of people. Going the old way seems easier for them…
The best alternative is an epublisher, we’ve been giving our authors 50% the whole time and we do all the work. Though we do expect some promotional efforts from the author if they want to see decent sales.
You get cover art, editing, formatting, ebook (distributed in all the same places as the big 6 and sometimes in other places because we’ve been doing it longer) and print using POD as well.
Because, yes, there is a stigma to self-publishing and there always will be, because there is no quality assurance. Some fantastic authors self-publish but so do people who needed more experience in writing, or editing before their work should be seen by the public. A publisher should indicate that the work was of decent standard. There is no guarantee of that if it is self-published.
Just a quick question, Sandy.
50% of Net or Gross?
Gross. Small publishers have to.
If we pay for the Net price but that isn’t actually what is paid to us we would go out of business. Our process is to divide the royalties for the author, editor and ourselves from whatever we ARE paid. So if our distributor takes their 25% (or higher) cut, we divide the money on exactly what we are paid.
You would have to be a huge business otherwise to subsidise the money that you actually don’t get when you are giving the author 50% of every sale.
Thanks for the swift reply. The Net/Gross thing is a bit of a bee in my bonnet I’m afraid. No offence meant.
Not a problem Stephen. All systems can be abused, and many times this has. If you have an unscrupulous publisher, they can add costs that don’t exist. The problem is, since they report your sales in the first place you have to trust them, whether they say they are giving you Net or Gross. It is just as easy to be popular and say “I pay on Net” but then not report all the sales to the author.
Reality is, if you have a dishonest publisher, you are screwed either way. Which is why the important thing is not Net and Gross, but what existing authors say about the honesty and integrity of the publisher before you submit a book to them.
I’m sorry, am I missing something here?
Have authors ‘always’ been paid royalties on the NET profit?
Because that is just asking to get scr*w*d over by the publisher.
I thought authors were paid a percentage of the cover price.
With the advent of ebooks being added to contracts, the norm has been % of net FOR THE EBOOK sales. Print royalties are still based on % of cover price (though you’re lucky to get up to 10% of cover these days…)
In early days, publishers were even giving 40-50%… but they scribbled that out of their contracts as quick as they could, as soon as ebooks starting gaining a foothold. Currently, 25% of net is the ‘industry standard.’ So, subtract all kinds of things and you’re looking at – at least on my royalty statements – about 11% of cover. (Kris Rusch has crunched her numbers and said that hers all fall *under* ten percent.) Oh yeah, and don’t forget to take the agent’s 15% out…
Is it any wonder that self-publishing looks so good?
Thanks for the info.
Yeah, self-publishing seems to be the only game in town then (unless there is a very big advance on the table and I think those are rarer than hen’s teeth these days)because e-books are going to keep on eating the print-book market over the next few years. At which point the author will be stuck with royalties on net for the larger portion of their book sales.
The only reason to sign a publishing deal now is for the kudos you get(which should not be sniffed at) for signing a deal with a big publisher. It looks like it should almost be considered something you write off against marketing rather than something you expect to make money off.
The only way no-advance works is if the publisher offers 50% or more of the cover price. Not net (which, I agree, would easily be accounted down to nothing), and not the price the publisher sells it for to a wholesaler/digital distributor like Amazon. Otherwise, it’s a worse deal than current terms because there’s even less benefit.
After reading this blog article and multiple comments about aggregators of publishing–has anyone considered what this might do to the “artists”? It might not be book burning of the past; but if the authors creative works have less and less value and get lost in the maelstrom of published and unpromoted works–isn’t the effect on the public the same. Pretty soon it may be the “publishers” and the aggregators who control what anyone reads. Just a thought.
25% and an advance? When and where? The authors I know get 6 – 10% royalties. I understand the big houses have cut back on the size of advances now too, at least in the romance industry. I gave up on NY years ago. Now I get paid every three months, instead of waiting two years as I did with my publisher, one of the big six. I do have to promote my books, but it’s my understanding all mid-list authors have to do a lot of promoting now and at their own expense. The great part of the world is going digital. Amazon is introducing the Kindle in countries around the world. For the book industry not to follow suit doesn’t make much sense.
Thank you posting this! You know, I have really been confused as to whether or not I should even seek out traditional publishing for my books. I have historical romances. But from the hundreds of comments I’ve read, trade publishers sound shady. I also heard authors are kept in the dark a lot. Now this? I don’t know what to think anymore.
Will Big Six publishers, for example, allow it’s authors to self-publish material on Amazon/B&N for example AND still publisher traditionally through them, or do they expect writers to leave Amazon alone? Personally, I’d like to do both but I’ve heard some authors say they were fired by their publishers when the publisher found out they were publishing through Amazon as well.