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A New Company Helps Clients of Literary Agents Self-Publish E-Books

3 October 2011

From The New York Times:

The Perseus Books Group has created a distribution and marketing service that will allow authors to self-publish their own e-books, the company said on Sunday.

The new service will give authors an alternative to other self-publishing services and a favorable revenue split that is unusual in the industry: 70 percent to the author and 30 percent to the distributor. Traditional publishers normally provide authors a royalty of about 25 percent for e-books.

The service arrives as authors are increasingly looking for ways to circumvent the traditional publishing model, take advantage of the infinite shelf space of the e-book world and release their own work. That’s especially the case for reviving out-of-print books whose rights have reverted back to the author.

. . . .

The new Perseus unit, called Argo Navis Author Services, will be available only to authors who are represented by an agency that has signed an agreement with Perseus. David Steinberger, the president and chief executive of the Perseus Books Group, said that the company had made an agreement with one major literary agency: Janklow & Nesbit Associates, whose authors include Ann Beattie, Anne Rice and Diane Johnson. Curtis Brown Ltd., which represents Karen Armstrong and Jim Collins, is also close to signing an agreement to make Argo Navis available to their authors. Perseus is in discussions with more than a dozen other agencies.

. . . .

He emphasized that while Argo Navis provided distribution and marketing services, the author remained the publisher. While authors get a much higher share of the revenue under this arrangement, they’ll receive fewer of the services, and financial support, provided by publishers under more conventional contracts.

In an effort to solve the problem of how to help readers discover e-books without print counterparts on tables in bookstores, Argo Navis will provide basic marketing services, like placing product pages on retailer Web sites. It will also make more extensive marketing services available for a fee.

. . . .

Tim Knowlton, the chief executive of Curtis Brown, said the service was an appealing option for authors whose books had gone out of print or books for which the author held the electronic rights.

“The ability to select which books an author or an heir would like to put into print, and to do so relatively inexpensively, is very appealing,” Mr. Knowlton said. “For any book that has potential for significant sales, it’s going to be a good opportunity to explore.”

Link to the rest at The New York Times

Let’s look at the basics:

For ebook conversion and putting the ebooks on the major ebook sites, Perseus charges 30%, presumably forever.

Perseus only works through agents. The agent charges 15%, presumably forever.

This is better than traditional publishers who only pay 25% royalties.

Let’s do the math for a $9.99 ebook on Amazon to compare traditional publisher vs. Perseus vs. Indie:

 

The Times article mentions Perseus receiving 30%, but does not specify if the 30% is calculated against the sales price of the book or the net after Amazon, Nook, etc., selling percentage. PG has given Perseus the benefit of the doubt and assumes their percentage applies to the net after Amazon takes its cut.

PG can’t let the “basic marketing services” of Perseus go by without a comment. These are apparently limited to putting product descriptions for each book on Amazon. PG would bet a 99 cent ebook that Perseus will not write the description and will palm that off on the author. As anyone knows who has ever listed an ebook with anybody, it’s way, way, way less than rocket science. PG bets Perseus is going to pitch the additional marketing services it provides for a fee very hard. PG didn’t see any mention that Perseus would provide a cover, for example.

One interesting question is whether Perseus maintains control of the Amazon/Pubit, etc., accounts or if the author has control. Where do the checks from Amazon, etc., go?  Another interesting question is whether Perseus really does receive its percentage forever. Can the author cancel out after a year when she comes to her senses?

An author is much better off doing everything for himself or herself than working with Perseus if the indie author does the conversion and listing of of the ebooks for himself.

An author can simply pay someone a not-very-high flat fee to convert and list the ebook. Consider the possibility of paying Perseus $2.10 per book, you’ll see that paying someone a couple of hundred dollars (or less) to convert a file to ebook format is an expense that gets recouped very quickly over the sale of a hundred books or so.

And, of course, you can’t use Perseus unless you use your agent. PG is interested in exactly what the agent is doing to earn his/her fee for ebooks after they sign someone up with Perseus. Perhaps figuring out those terribly dense royalty reports from Amazon.

If you look at the difference between what an agent earns via traditional publishing and Perseus self-publishing, you’ll see a little potential conflict of interest drifts through the air. PG suspects Perseus may pitch agents on this model to avoid conflict of interest issues, but PG still thinks those issues exist, particularly if the agent pitches Perseus against the author going completely indie.

What is really the most shocking thing is the New York Times is, with general approval, recognizing that authors can get much better deals on ebook publishing than traditional publishers are giving them.

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29 Comments to “A New Company Helps Clients of Literary Agents Self-Publish E-Books”

  1. When I saw the Times article earlier in the day, I guffawed, brewed myself a pot of coffee, and waited to see your response.

    You never disappoint me. I, too, was especially tickled by the ‘basic marketing services’.

    Can we say elitist pandering? It’ll be like honey to flies.

  2. As Dean Wesley Smith says… looking at the maths… why would you not spend the time to learn how to Indie Publish?

  3. And just last night, DH and I discussed my publishing company doing exactly what Perseus is doing.

    Me: If people are dumb enough to pay agents 15%, why don’t I open up Angry Sheep Publishing to queries and do the same thing?

    DH: You can’t do that.

    Me: Why not?

    DH: You have this disease called ethics.

    • Suzan, thank you. Brightened my day.

    • *laughs* Great line from your husband, Suzan.

      I opened a new account at a bank, today. Not only did the teller express surprise that I filled out the deposit ticket correctly, but that bank also offers incentives to new sign-ups who take a mini course in money management.

      O.O

      Look, math wasn’t even my strong point in school. I flunked out of calculus. And I can do the math for these things.

      Why is it so hard?

    • “You have this disease called ethics.”

      REading this line has led to an unfortunate incident involving me, a cup of coffee, and my keyboard.

  4. Quote from PG: “Perseus charges 30%, presumably forever.”

    Maybe, maybe not. I know of at least one other company doing something similar, which allows either side in the agreement to unplug from it with 30 days notice. Which makes a big difference — if the author is dissatisfied with the results of the company’s service, they can just walk away with their books’ rights and go somewhere else with them, or then do it on their own. So the pressure is on the company to produce some results. This might or might not be the case as well with this Perseus bunch; if it is, then a case could be made that for some writers at least, it’d be worth it for them to give Perseus a shot, see what the results are, then decide whether to stick with them. If, however, it is in fact a “locked in forever” deal, probably not so.

    • You’re right, K.W., that would make a big difference.

    • I wonder if an author were to give notice to end the association, would s/he come away with the formatted files, cover art, ISBN, etc? Or would the author have to go through those same hoops again to place that same title on the market?

      And, yes, the comment about ‘ethics disease’ is destined to become a classic. Brilliant.

  5. … … …

    *beth flails and makes incoherent gurgling noises like a WoW murloc being choked on a horse*

    DEAR GODS WHY WHY WHY WHY WHY???

    Which is, admittedly, what your analysis says with more coherency.

    I have a sneaking suspicion that Open Road Publishing is doing something very similar (but they do give covers…). And have been doing it for some time ahead of this, so it’s probably profitable.

  6. There’s a sucker born every minute. — P.T. Barnum.

  7. “One interesting question is whether Perseus maintains control of the Amazon/Pubit, etc., accounts or if the author has control.”

    You’re needlessly overstating your case, PG. It says right in the article: “…while Argo Navis provided distribution and marketing services, the author remained the publisher.” Pretty much answers the question for me. If the author is the publisher, then the author has the control of the accounts.

    • K.W. – Perhaps, but not necessarily. The author could be named the publisher by Perseus during the course of cutting and pasting the book description into Amazon, but not do anything else.

      Perseus could well have exclusive access to the account, acting under its contract with the author. I would speculate that the checks are going to Perseus.

      • Well, that seems like a Tweedledee & Tweedledum sort of thing, where we can decide that a word means exactly what we want it to mean. But in this case, wouldn’t it also require that Amazon agree as to what the word “publisher” means? Anything’s possible, I suppose, but I don’t see any apparatus in Amazon’s KDP system by which one party can be designated as the publisher and then some other party controls the account.

        • K.W. – You can put whatever name you want in the Publisher box and keep the ID/Password and put your own address or bank account as the place where the money comes.

          Include permission to deposit checks in the agreement with the author, then Perseus or the agent deposit the checks and send the money where it’s supposed to go.

          Amazon doesn’t care who is listed as publisher unless someone complains.

          • “Amazon doesn’t care who is listed as publisher unless someone complains.”

            Yeah, and if I’m listed as the publisher and I don’t like where the checks are going, then I’ve got the ability to complain to Amazon, don’t I? If the worst were to happen and this went to court, all the writer & copyright holder would have to say is, “Hey, these people told me that I was going to be the publisher, and that’s what it says on our agreement, but now somehow I don’t control the account — what’s up with that?”

            Even just on a negative PR basis, I think this would be more poop than this Perseus bunch would want to buy into. You might be correct about what they’re going to do, but in the meantime I’m going to assume that they’re just a little bit smarter than that.

            • Don’t forget, subsidy publishers like the various Author Solutions scams are also claiming that their writers are the publishers of the works – even though the publishing company’s name is the one listed on retail sites! – just because the writer is the one paying for the production. I have gotten into some real arguments with writers absolutely convinced they self published when they paid AuthorHouse, Xlibris, etc. to publish their book for them.

              The definition of what it means to be a publisher seems to be one which is a being…bent…a little bit, these days.

      • I’m with you, PG. I find it doubtful that Perseus will be setting up multiple separate accounts at Amazon with each individual author’s financial info. MUCH more likely that they will be the ‘distributor’ under their one main account, and that they will be the ones getting the info – and the checks. As you said, you can designate ANYONE in the publishing field when you fill out the KDP form. That doesn’t hold much legal weight, I’d imagine. The account creator has all the cards, regardless.

  8. This is a terrible idea. Why would you give someone 30% of your royalties to do formatting and uploading. I know excellent, top of the range, formatters who will do the job for less than $200.

    But you really can learn to do it yourself in a day or two. And after you’ve done it once or twice, it takes no time at all. But hey, if you want to pay for it, it’s your time and it’s your dime. Just don’t do anything foolish like paying anything other than a flat fee for the privilege.

    I think it’s a dereliction of duty for any agent to recommend such as service for their clients. Without being familiar with US law at all, I can only presume (in hope) that it’s illegal for an agent to receive financial incentives of any sort for recommending such a service (hypothetically, I stress).

    But really, 30%? That’s just shocking. It’s gouging, plain and simple, and it’s predatory.

    And there are some pretty big agencies said to be partnering with them: Curtis Brown, Janklow & Nesbitt. If I had an agent who recommended a service like this to me, I would fire them on the spot.

  9. I had to read that three times. 30% For what? IMHO, this is just another stab at hitting the indi people in the pocket because they want distribution. Thanks anyway.

    • Addison – Remember, this is for agented authors only. It’s not for indie authors who either have never had agents or have terminated their relationships with agents.

      My impression is that Perseus is designed to help agents work around the conflict of interest between being an agent and being a publisher. I have doubts about how successful this will be.

  10. I’m still stuck on the agents’ role in all this. If Perseus is a closed shop, working only with signatory agencies, and the terms are set (meaning no negotiation), then the agents’ role is to … sign with Perseus? How in the world can that possibly good for writers?

  11. How is an agency signing a deal to funnel their clients into Argo Navis ethically any different than an any signing a deal with, say, MacMillan, to funnel all of their clients’ books into MacMillan imprints… WITHOUT seeking better offers or better contractual terms for their clients from competitors, but instead ONLY dealing with MacMillan because the agency (as is the case here with Argo Navis) has signed a deal with that company?

    This strikes me as yet another variation of agents exhibiting an appalling absence of business ethics, in their supposed role as representing their clients’ best interests, to further their pursuit of getting a cut of their clients’ self-publishing income.

    • That seems to be the fun part.
      The Perseus Books Group adds another imprint, which in itself is nothing to report about. Ok, this time it is not an imprint but a business unit since they act as distributor who distributes (not publishes!) (almost) everything.
      Agents do what they are already alleged to do, taking the offer that is the least work for them.

      Gee, and I thought distributors were supposed to go the way of the Dodo in ePublishing. 😉

      Acting as distributor is actually a nice way of saying “We did not touch the contents of the book. Go and complain somewhere else.” – the same argument is of course true for things like editing.

  12. Unfortunately, I think we’re looking around at each other and seeing the informed, the educated, and the unafraid.

    Which does not (yet? I hope?) seem to be the norm among writers.

    There has never been a time when it has been MORE important to spread the word, MORE important to cue folks in on what this is all about. Because there’s a chance, right now, to keep this sort of thing from becoming entrenched.

    But if it becomes the “new normal”, before too long someone with money will find a way to make it the “new mandatory”. And personally, I don’t think sharing our profits with folks who aren’t giving us any real value for their share is in the best interests of writers as a group.

    Just say no.

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