The Business of Writing

Patreon Introduces New Tiers for Creators. Can It Avoid Another “Fiasco”?

19 March 2019

From Fast Company:

In 2017, Patreon rolled out a new fee structure. Today’s it’s known internally at the company as “the fiasco.” A revolt from creators and patrons prompted it to retreat almost immediately.

Today, Patreon, which is valued at a reported $450 million, is trying again. It is announcing Patreon Lite, Pro, and Premium as a means to tailor fit its services to the needs of the platforms’ 100,000-plus creators. “We wanted to make sure and do right by the creator base that’s been with us for all these years,” says Wyatt Jenkins, SVP of product at Patreon. “I’ll talk to a painter with 50 patrons and then later in the afternoon, I’ll talk to a media company with 25 employees that makes over $1 million a year. So it’s pretty clear that [Patreon is] not one product anymore.”

Every creator with an existing Patreon account will automatically be grandfathered into the Pro tier with no changes being made to their account. Essentially, this new system is giving creators the option to pare down with Lite (which is meant to be the easiest onboarding option for creators who just want a page with no tiered benefits for patrons) or upgrade with Premium (which charges an additional $300 per month charge in exchange for services like team accounts and a dedicated partner manager). Patreon’s cut–5% in Pro and 9% in Premium, respectively–will also be locked in for existing accounts but will increase to 8% and 12% for new ones created after these membership plans officially launch in May.

. . . .

In addition to the tiered membership, Patreon also announced changes to its processing fee structures: Pledges over $3 will be charged 2.9% plus 30¢ per payment. Anything below $3 will be charged 5% plus 10¢ per payment–the latter being a direct response to 2017’s “fiasco.”

Patreon’s 2017 changes to its fee structure were met with instant backlash because the processing fee was heaped onto the patrons instead of being taken out of the creator’s account (with no ability to opt in or opt out). In addition, the proposed fee of 2.9% plus 35¢ disproportionately affected anyone pledging between $1 and $3. As TPR Jones accurately summed it up in his tweet at the time: “Pledging $100 to one creator will now cost $103.25, which is reasonable. Pledging $1 each to 100 creators will now cost $138, which is not reasonable.”

. . . .

“Creators don’t want somebody in between them and their fans,” says Jenkins. “What I learned and what Jack learned and the way we’re doing this new rollout out is the business relationship is between us and creators. We are a membership platform that empowers a strong relationship between creators and their fans.”

. . . .

The primary complaint comes down to a lack of flexibility in even this three-tiered offering. Qaadir Howard started his Patreon account about two years ago in response to YouTube’s exorbitant cuts in their payouts and its demonetization of non-family-friendly content. In reviewing Patreon’s new offerings, Howard isn’t particularly moved to upgrade his account to Premium, even though he, like many other creators, could benefit greatly from the services offered with it.

“I don’t know if I’d be willing to pay $300 for it–that’s a car note,” Howard says. “I think they should have it where it’s more à la carte: Let me pay for the thing that I want instead of it just being a flat $300, and maybe I need only one thing.”

Link to the rest at Fast Company

Priorities

3 March 2019

From Kristine Kathryn Rusch:

I write a lot. I always have. When I was in college, I wrote essays instead of taking tests, wrote fiction, and worked as a freelance nonfiction writer. I also worked in the news department of a listener-sponsored radio station, where we reported and wrote a half-hour newscast. I did that twice a week on top of everything else.

Nowadays, I write books, nonfiction, and short stories. I don’t have a target weekly word count, but I do put in time, almost daily. I’m generally disappointed if I get only 1,000 words in a day, and super pleased if I get over 5,000.

Remember, I only count new words, not rewrites or anything else. All of that happens at other times, not during my writing time.

My writing has been the constant in my life. I took writing classes in college, not to learn from the instructors (most of whom had less success than I did even then) but because I needed to block out time for writing in my busy life, and I knew myself well enough to understand that if I was writing for a class, I would block out time every week.

Mind games. Writing is all about mind games and understanding yourself.

Even though I don’t understand myself as well as I think I do.

For years, I would say that I get so much writing done because I have no life. Turns out that was true. Due to the constrained circumstances I lived in on the Oregon Coast, I had no life—or very little of one. I couldn’t go out to movies or dinner with friends; I had no opportunity to see concerts or plays; I couldn’t take in-person continuing education classes; and I couldn’t make the one to two hour one-way drive that would take me to the bigger cities, because I couldn’t guarantee I would make the ride home.

I had the time to write—when I was healthy, which was rare. So I learned how to write while ill.

The key, for me, turned out to be a structure I didn’t have to think about. I knew what I needed to do—not in the deadline sense, but in the daily sense. It took me a long time to form that structure, but once I had it, I could function inside it almost instinctively. When my circumstances changed due to our move to Las Vegas in 2018, it took me weeks to realize that I had demolished my structure when I changed locations. I had to rebuild from scratch.

Rebuilding forced me to reexamine my priorities. I can’t build a structure until I know what I put first, second, and third in my life. So, priorities before scheduling—or I’ll blow everything up and get nothing done.

. . . .

I was irritated to learn that exercise made me feel better. All those studies that say eating right and exercising will improve your health and mood? Those damn things are right. I wish they weren’t, to be honest. It would be easier to sit on my butt and eat lots of bad-for-me stuff. But when I do that, I feel much, much worse.

So eating right and exercising makes me feel better. The other bonus is that I sleep better. (Yeah, also irritating.) And the third bonus? I have more energy. Even as my health declined, my energy level remained consistent because of my commitment to exercise.

. . . .

Sometimes, when I was really really sick, I had a word count quota. Or an hours-at-the-desk quota. I try not to work with quotas, though, because I love to write. What’s the point of doing it otherwise? All of my efforts are aimed at keeping the writing fun.

Except…I would rather be reading.

So, I have learned the hard way that reading is a reward for a good day’s writing. The same with any other kind of story I could consume. No TV shows until I’ve written; no movie until I’ve written; no games until I’ve written.

Sometimes I’ll stumble around my condo or my neighborhood, grumping aloud at myself: You’re not writing, are you? Shouldn’t you be writing? And if I’m not tending to my health or doing something for my relationship with Dean, that complaint is a valid one. And one I need to listen to.

Sure, I would rather read a book or sometimes, I’d rather clean the cat boxes than write. Especially if some project is going slowly.

Email isn’t writing. Research isn’t writing. Rewriting isn’t writing. Only new words is writing.

Remembering that has made me prolific, even with all the health problems.

Link to the rest at Kristine Kathryn Rusch

Here’s a link to Kris Rusch’s books. If you like the thoughts Kris shares, you can show your appreciation by checking out her books.

Hack of Email Provider Destroys Servers and Two Decades of Data

21 February 2019

From LexBlog:

We predicted last year that hackers would become more malicious in the future, not only stealing and selling data for nefarious purposes, but actually destroying data and even systems. That reality hit email provider VFEmail last week, and on February 12, founder Rick Romero tweeted “Yes, @VFEmail is effectively gone. It will likely not return. I never thought anyone would care about my labor of love so much that they would want to completely and thoroughly destroy it.” The tweet went out after he watched the intruder reformat the hard drives of his email service, which has been in existence since 2001. The intrusion wiped out two decades of data. This is a tragic story.

Link to the rest at LexBlog

You may not need to keep the meandering emails about the old days from Uncle Fudd that make their way into your inbox all too frequently, but, if you’re a professional writer, you probably have some business emails sitting there as well.

PG has used Thunderbird as his email software almost forever. After reading the OP, he backed up his important emails to a couple of different locations using Thunderbird’s export function.

He’s also going to try a couple of third-party email backup solutions as well.

One of the practices that make PG’s backup job easier is that he has Thunderbird set to route important emails to some specific folders, so he knows where to go to find good files to backup. He also uses different email addresses for different purposes. (Thunderbird can handle multiple email accounts without any problems.)

For example, if you’re wandering around online and sign up for some update service you’ve never seen before, until you learn whether the updates are going to be really useful for you, you might want to use an email address that is just for those online sites that haven’t yet demonstrated they won’t fill your inbox with junk.

The last time PG checked, Gmail and Outlook.com were still providing free email services. You won’t be able to get bob@gmail.com because that was gone a long time ago, but when PG just checked, bobthehackwriter@gmail.com was available. He has 3-4 Gmail accounts he uses for different purposes. If you don’t want to check 10 separate email boxes all day, you can set most email services to automatically forward any incoming emails to another address, so all your separate email addresses funnel into a single place.

If you have multiple emails, it’s not a good idea to use the same password on each one. (Ditto for almost everything else you do online). To keep the various id/passwords straight, Windows will offer to save them, but PG prefers LastPass, which offers a free version that works just fine. He has also heard great things about 1Password. If you use more than one computer or a computer and a smartphone, a password manager like LastPass syncs all the passwords you store in it to your LastPass account wherever you install LastPass. When you trash the old computer and get a new one, LastPass will bring all your passwords and other secret stuff to the new computer as soon as you install it.

For client emails, in addition to the mass email exports to backup locations, PG often simply prints important client emails to PDF, then stores the email in the appropriate client file folder. It’s much easier to do a quick check of emails that way than to dig through a giant email archive. His client files are backed up seven ways from Sunday, locally and remotely.

PG invites one and all to post comments with their backup solutions for important emails in the comments.

Nine Lessons from a Small Indie Publisher

13 February 2019

From Publishing Perspectives:

Last October here at Publishing Perspectives, I wrote about starting my new publishing house—actually more like a publishing room—Mensch Publishing.

I promised/threatened an update when its first book hit the streets, and February 7 saw the release of Guy Kennaway’s affectionate, funny, and important story of his mother’s desire to end her own life. Time To Go will be available around the world in English, in print, in ebook, and in audio formats.

What, if anything, have I learned? Perhaps nine lessons to follow up a Christmas theme.

Lesson 1. Finding the right book is by far the most important thing, but getting the small things right is vital and unbelievably hard work.

Lesson 2. Being a small (tiny) independent publisher is liberating in its avoidance of group think and corporate bureaucracy but challenging in its complexity. I have more than 1,000 emails in my files all for one book and that’s computed after I’ve assiduously deleted the several thousand I was copied into for no reason.

Lesson 3. Treat your suppliers with respect. I’ve taken a policy decision to pay cash owed into a freelancer’s account the same day I receive the invoice. My cash flow is important but respecting other people’s cash flow generates goodwill, and better relationships are vital for a small enterprise—perhaps for big enterprises too.

Lesson 4. Everything costs more than estimated, and income is always less. Those who see publishers, large or small, as greedy monsters making large profits should try it for themselves.

. . . .

Lesson 8. Managing a site. Tweeting. Communicating with authors, agents, sales, distribution, rights, design, production, finance, agents. Setting up accounts with Publishers Licensing Society. With Nielsen. All take time, obsession, attention to detail and all are essential.

Link to the rest at Publishing Perspectives

When PG read the OP, he was curious about whether a publisher with a single employee (the author of the OP) used the same types of contracts and paid royalties at the same rate a much larger publisher would. PG notes from the book’s Amazon listing that the one-person publisher is pricing the book at the same level a major international publishing house would.

The Beginning of the End for Patreon

9 February 2019

From The Digital Reader:

There comes a time in the life of many companies when the owners (or investors, or vulture stockholders) decide that they want to extract more profit than is healthy for the company to survive. This is one of the things killing American newspapers, and it’s even impacting B&N, and now it’s about to kill Patreon.

Patreon is fairly healthy, but apparently not profitable enough for its capital investors.

From CNBC:

The number of active patrons supporting artists on the platform in 2019 has seen significant growth, up 1 million over the last year, the company said. The company is also on track to pay out $500 million to content creators in 2019, pushing the company to surpass $1 billion in payouts since its inception in 2013.

Under the company’s current business model, 90 percent of funds are paid directly to content creators. Patreon takes 5 percent, and the remaining 5 percent covers transaction fees.

Patreon CEO Jack Conte said in an interview with CNBC that the platform will soon be facing the challenge of maintaining a profitable model as the company continues its growth.

“The reality is Patreon needs to build new businesses and new services and new revenue lines in order to build a sustainable business,” Conte said.

The company does not currently provide contracts, which allows users to retain 100 percent ownership of their work and full control of their brand.

The company plans to provide creators with new “value services,” like options for merchandising, to generate new revenue. Creators will be given the opportunity to participate in these services, and it could ultimately reduce Patreon’s generous 90 percent pay-out model.

What this means is that Patreon’s investors want the company to be more profitable, and if necessary they’re going to force the company to pay its users less.

. . . .

I do not currently use Patreon; I closed my account when they tried to jack up costs in late 2017. But I had been thinking about going back to Patreon in order to fund the blog through donations and pledges.

Now I think I’ll just still with Paypal (not exactly a nice company either, but beggars can’t be choosers).

The thing about Patreon not being profitable enough is that Paypal has a very similar model and they turn a profit on a smaller cut of the funds they transfer. Paypal only collects payment processing fees (the 5% transaction fees mentioned above) and yet Paypal is so profitable that they spun off Ebay as not being worth the hassle.

Of course, Paypal had a unique advantage when they were starting out; they were acquired by Ebay, which then forced buyers and sellers to use the service (when you’re growing your business, there’s nothing like having a captive audience who can’t say no).

. . . .

Folks, Patreon’s attempts to increase its profitability are doomed not because this is going to drive away users but because their niche is too damn small. Patreon only handles one small segment of payment processing (what are essentially charitable fundraising campaigns); in comparison, Paypal covers dozens of segments.

Link to the rest at The Digital Reader

PG suggests that, unless an internet-based business has some sort of moat around it (patents, must-have technology, unique voices or expertise, etc.), raising prices is very difficult because someone else is always ready to clone the business plan and offer the service for less.

PG is only passingly familiar with Patreon, but is not aware of any patents or similar limits to those who might build a similar platform for the same purposes – providing an online means for people to help fund various creative endeavors.

However, while PG was looking at Patreon’s Terms of Use to see if there were any mentions of patents, trade secrets, etc., he did find a rights grab that may be troubling to authors and other creators:

You keep full ownership of all content that you post on Patreon, but to operate we need licenses from you.

By posting content to Patreon you grant us a royalty-free, perpetual, irrevocable, non-exclusive, sublicensable, worldwide license to use, reproduce, distribute, perform, publicly display or prepare derivative works of your content. The purpose of this license is to allow us to operate Patreon, promote Patreon and promote your content on Patreon. We are not trying to steal your content or use it in an exploitative way.

You may not post content that infringes on others’ intellectual property or proprietary rights.

Patrons may not use content posted by creators in any way not authorized by the creator.

On the front page of Patreon’s site, the company makes a representation that some might construe as conflicting with the quoted portion of the Terms of Use:

You own your content

There are no contracts to sign and you retain 100% ownership of your work. You made it, not us.

Under Patreon’s equivalent to an FAQ, the following is a question and answer about ownership of creative works:

Wait, does Patreon own my content?

Nope! Your content is 100% yours, unless a record label or studio owns part of it, in which case it’s partly theirs too, but it’s definitely not Patreon’s — not even a little.

PG suggests that Patreon’s Terms of Use are, in fact, a contract between Patreon and its creators. It is a “click-to-accept” contract with an electronic signature by the creator which is not physically “signed”, but is still enforceable by Patreon against the content creator.

In the United States, the Electronic Signatures in Global and National Commerce Act (15 U.S. Code Chapter 96) explicitly authorizes electronic signatures in interstate commerce and makes electronically-signed contracts enforceable. Here are the first paragraphs of the law:

(a) In general Notwithstanding any statute, regulation, or other rule of law (other than this subchapter and subchapter II), with respect to any transaction in or affecting interstate or foreign commerce—(1)a signature, contract, or other record relating to such transaction may not be denied legal effect, validity, or enforceability solely because it is in electronic form; and
(2) a contract relating to such transaction may not be denied legal effect, validity, or enforceability solely because an electronic signature or electronic record was used in its formation.

In particular, the quoted portion of the Terms of Use above explicitly create a license, which is most definitely a species of contract, between the content creator and Patreon.

Furthermore, the license cannot be unilaterally canceled by the content creator – it is a “perpetual, irrevocable”, “sublicensable, worldwide” license.

What about all the “you own your content” messages on Patreon?

In a traditional publishing contract granting a publisher all rights to an author’s book, the author continues to “own the content” in that the author is the owner of the copyright to the book. However, the publishing contract grants the publisher the exclusive worldwide right to print, publish and sell the book in all its various forms, including the right to license subsidiary rights for movies, television shows, etc.

Under such a contract, the author owns the content, but can’t do anything with it because the publishing contract grants the publisher all rights to exploit the contract.

Let’s briefly unpack the licensing paragraph:

By posting content to Patreon you grant us a royalty-free, perpetual, irrevocable, non-exclusive, sublicensable, worldwide license to use, reproduce, distribute, perform, publicly display or prepare derivative works of your content. The purpose of this license is to allow us to operate Patreon, promote Patreon and promote your content on Patreon. We are not trying to steal your content or use it in an exploitative way.

PG suggests that the first sentence is inconsistent with the second sentence in tone and, perhaps, in the manner in which it may be enforced.

The portion of the first sentence beginning with “you grant” is precise and definitive. The second sentence is squishier. “The purpose of this license is to allow us to” . . . .

Under general principles governing the interpretation of contracts, if there is a conflict between a specific and a general provision, the specific provision will govern. If PG were representing a content creator, he would suggest that the second sentence above be reworded for clarity:

“The license granted in the preceding sentence is expressly limited to grant Patreon the ability to include content created by the author in various ways that are reasonably calculated to promote the author’s content on Patreon’s website. All other rights of author in and to the content are expressly reserved to author, including, without limitation, the exclusive right to grant others the right to print, publish, license and/or sell the content and/or any derivative rights arising from the content to any third party. After termination of this Agreement for any reason, at author’s request, Patreon will provide a document disclaiming all rights to author’s content if reasonably requested by author disclaiming any and all rights in and to the content.”

 

 

The Growing Importance of Intellectual Property

31 January 2019

From Kristine Kathryn Rusch:

I need to be clear as I start this post. We writers create intellectual property. We license our copyrights. We do not sell stories. In fact, the stories we tell, along with their titles, are often not copyrightable. The form in which we tell that story—the order of the events, the order of the words we use,—those things are copyrightable, but the basic boy meets girl, boy loses girl, girl discovers she’s fine on her own storyline can and does fuel a thousand books and movies. (That’s why so many memes over the holiday season made fun of the romance movies on Hallmark. Because the movies—all copyrighted in their own right, all different in the copyright sense—share a lot in common.)

If you don’t understand copyright and you consider yourself a professional writer, then you do not understand the business you are in. If you have published a novel, traditionally or indie, and you do not understand copyright, you are volunteering to get screwed over and over and over again. I say this often, and I’m saying it loudly again, because the trend for 2019 and beyond is that every organization you do business with will try to take a piece (if not all) of your copyright on each and every one of your projects.

Your job is to protect that copyright.

. . . .

Forbes actually published an article in fall of 2018 titled “What Authors Should Do When Their Publisher Closes.” You can click over there if you want. The advice isn’t good, because as someone in the article says, what an author should do varies based on the author’s contract. And if the author has an agent, then they’re probably screwed. If the author doesn’t understand copyright, then they’re definitely screwed.

. . . .

I recommend publishing indie, because that’s the best way to protect yourself and your writing income. You’ll have a career if you do that. Your career might vanish on you if you try to remain traditional. Or, rather, you will write as a “hobby” while you make your living doing something else.

Yes, I’m being harsh, but that’s because the intellectual property apocalypse that I’ve been warning you about is upon us. The trends are there, and the signs that traditional publishing (and all of the other big entertainment organizations) know about the value of intellectual property are becoming clearer and clearer.

. . . .

For years now, the Big 5 traditional publishers have had contracts that essentially transfer the entire copyright of a novel from the author to them. The contracts don’t say that explicitly, but when you read the contract as a complete document (which is how you should read it), you realize that the sum total of what the clauses mean is that the writer retains no part of the copyright, and is only entitled to a tiny percentage of the money that copyright earns.

The reason these contracts changed about a decade ago had nothing to do with publishing and everything to do with mergers. As these publishing companies became part of big international conglomerates, many of them entertainmentconglomerates, the legal teams redrafted the contracts to do the copyright grabs.

Most writers had no idea what they were signing, and most of their agents didn’t either. Agents are not trained lawyers. A handful of the big agencies have lawyers on staff, but most of those agencies are concerned with making the agency money, not with making the writer money. So a lot of the contracts are structured to pay and protect the agent, while bilking the writer.

. . . .

Up until a year or so ago, most of the Big Five continued to operate like traditional publishing companies have since the 1990s—a focus on publishing a lot of titles, hoping that some will stick and become bestsellers. But that strategy isn’t working, and sales are down precipitously.

. . . .

[Simon & Schuster] has been in a media conglomerate since the 1980s. I’m not going to go through its tortured history, which runs from Paramount to Viacom and beyond, but realize this: It became part of the CBS Corporation officially in 2005. Around then, it became impossible to get book rights reverted, which is one of the tricks that is recommended for writers in the Forbes article I cited above. (How 1995. Sigh.)

S&S has experimented with electronic books since the 1990s. Dean and I personally made a lot of money in the early 2000s when S&S realized they hadn’t licensed e-rights for Star Trek books. (Dean and I wrote a bunch of them in the 1990s). S&S has tried to have a self-publishing arm since 2012, and they’re doing a lot of things that require writers to pay for services that publishers used to provide.

. . . .

The more IP a company acquires, the more its value goes up. Even if they don’t create anything from that IP. Acquiring a novel’s copyright—with all its potential spinoffs, TV shows, toys, comics—increases a company’s value tremendously.

Read that paragraph again, because the information therein is the key to this whole piece.

The more IP a company acquires, the more its value goes up. Your novel is IP. If they acquire it, their bottom line goes up, even if they never do anything with that IP. Got that?

That’s why S&S stopped, in 2000 or so, reverting the rights to the novels they acquired. Those novels equal more earnings potential—and they allow the company to maintain a value that it wouldn’t have otherwise.

I’ve been warning writers about this copyright grab by corporations for some time, but it was easy to ignore me because the Big 5 have not been (for the most part) exploiting (the legal term for developing or making use of) that copyright.

S&S finally is. That’s what Simon & Schuster’s CEO Carolyn Reidy’s heady year-end report was really all about. She called 2018 “the most successful year in Simon & Schuster’s history,” and yet she didn’t cite a single print bestseller as something that caused the success.

Instead, she touted the rise in audio . . . as well as a mention that sent a little shiver through me.

She wrote:

…[backlist sales now] comprise a higher portion of our revenue than at any time in memory…while readers wanting the tried and true is an industry-wide phenomenon, our concerted effort during the last few years to acquire books with the potential for long-term backlist sales has yielded dividends.

This article does not specify what exactly she means by “backlist sales.” Does she mean actual ebook and print sales, or other licensing, such as foreign rights and so on? Clearly S&S is exploiting the audio rights clauses in their contracts.

What is clear, however, is that a big traditional publisher has finally figured out that not only does their backlist have value in raising the company’s worth, but it also has earnings potential that can be exploited in 2019.

Why does this send a chill through me? Because if one traditional publisher learns it, the others will learn it as well. And the ability of writers who have sold their work into traditional publishers to get the rights reverted will go down to almost nil.

Big traditional publishers will finally join their counterparts in the entertainment industry—the movie/TV companies, the music studios, the game companies—in demanding control of every aspect of the copyright from the original author.

Which means that if an author signs one of those agreements, the author will get pennies on the dollar (if that) for any rights—audio, movie, TV—rather than the kind of earnings writers could have gotten as recently as 10 years ago.

. . . .

And those of you who licensed mass market rights a few years ago, thinking you’d get your ebooks into stores, you probably already signed away most of the copyright, particularly if you went with Harlequin or Simon & Schuster.

Link to the rest at Kristine Kathryn Rusch

Here’s a link to Kris Rusch’s books. If you like the thoughts Kris shares, you can show your appreciation by checking out her books.

As usual, Kris incorporates a lot of intelligent business thought and advice into the OP (and her other posts in this series).

As PG has mentioned before, he has negotiated, drafted and/or reviewed a great many contracts during his legal career, including some large technology copyright and patent licensing agreements. As he has also mentioned before, the typical contracts between authors and traditional publishers are some of the most unfair and one-sided agreements he has seen.

In a prior era during which it was impossible for an author’s works to reach any sort of meaningful audience without a publisher to cover the costs of printing books and provide meaningful access to buyers for large numbers of physical bookstores, perhaps the value of a publisher’s services was an extremely large portion of the income generated by sales of a book.

However, in an age in which:

  • Amazon is the largest English language bookseller in the world; and
  • Opens its electronic doors to self published authors on terms substantially equivalent to those it provides commercial publishers; and
  • Ebooks have the highest profit margin of any edition of a book a publisher sells; and
  • Ebook editing, formatting and cover design of a quality comparable to that provided by a commercial publisher can be had for a few hundred to a few thousand dollars;

the real value of a publisher for a typical author compared to the effective cost of a publisher to that author has declined precipitously.

PG was about to discuss the value of branding for either an ebook or a printed book, but he will be uncharacteristically brief.

Does anyone go to an online or offline bookstore seeking out a Random House book? Of course not. They’re looking for an author, a genre, etc.

With respect to promoting and selling books, which brand name is most valuable, James Patterson’s or Little, Brown and Company’s?

Without singling out any particular literary agent or agency, PG will say, as a general observation, that agents famous and obscure don’t do anything significant to improve the contract terms for publishing contracts other than increasing the amount of the advance on some occasions. In particular, agents rarely if ever do anything to address the issues Kris discusses in the OP.

In some types of contracts — consumer loans, for example — federal and/or state legislatures have passed laws that prevent commercial lenders from including some contract provisions that are unfair or harmful to borrowers. Compared to the number of individuals who take out loans to purchase a house, automobile or dishwasher, however, authors are a tiny constituency and elected officials have much bigger fish to fry than commercial publishers.

However, perhaps as a result of such consumer protections, some authors may believe they are somehow protected from  unfair provisions in publishing contracts between themselves and large publishers. That belief is incorrect.

Some of the most unfair provisions in a typical publishing contract are presented in the most innocuous manner imaginable.

 

 

Finally, there is nurturing. Publishers don’t just produce books. They nurture. Literary agents also provide nurturing in case publishers fall short in any way.

Like a baby duckling, a baby author needs to be nurtured and petted and encouraged and gently guided if she/he is to grow into a beautiful swan.

Who better to nurture such a delicate creature than a Kommanditgesellschaft auf Aktien headquartered in Gütersloh?

Off the top of his head, other than publishing, PG can’t ever remember ever having a business discussion that included the word nurture or any of its variants.

PG is reminded of a quote attributed to former president Harry S. Truman, “If you want a friend in Washington, buy a dog.”

PG suggests that if you want someone to watch over you, steer clear of the publishing business.

.



The Disastrous Decline in Author Incomes Isn’t Just Amazon’s Fault

20 January 2019

From Electric Lit:

[T]he Authors Guild published its 2018 Author Income Survey.

. . . .

This was the largest survey ever conducted of writing-related earnings by American authors. It tallied the responses of 5,067 authors, including those who are traditionally, hybrid, and self-published, and found that the median income from writing has dropped 42% from 2009, landing at a paltry $6,080. The other findings are similarly bleak: revenue from books has dropped an additional 21%, to $3,100, meaning it’s impossible to make a living from writing books alone.

. . . .

The Authors Guild has a pretty clear idea of what’s behind this disturbing trend, namely the rise of Amazon, which severely cuts publishers’ margins on book sales. Authors ultimately shoulder the cost because publishers offset their losses by giving out smaller author advances and royalties. The platform’s resale market also means that, within months of publication, books are being resold as “like new” or “lightly used,” a scenario in which no new money goes to the actual author of the book. The Authors Guild acknowledges that Amazon isn’t the only place where authors are losing out, but the culprits are of a kind: electronic platforms like Google Books and Open Library claim fair use rights in order to offer classrooms products without paying authors royalties. This is problematic because those royalties, a kind of pay-to-play model of compensation, are how artists have made their money ever since it went out of fashion to have a patron who could support your entire career.

. . . .

This year’s Authors Guild Survey is right to focus on the harm Amazon does to working writers; personally, I’ve made my 2019 resolution to put my money where my mouth is and buy all my books at local, independent bookstores. But the survey results made me wonder if that would be enough—if it’s possible, in the age of the Internet, to reverse the belief that content should mostly be free. By content I do mean to encompass all ends of the artistic spectrum, that ill-defined mass of high and low entertainment and art and news that rubs up against each other on the web in a way that makes it more difficult to separate out, and perhaps less meaningful to do so. Basically, people are insatiable for this panoply of words and images; they want mass input. If you do a Google search for “apple pie recipe,” for example, the top results include both Pillsbury’s website and the personal blog of a home cook. The point isn’t that there is anything wrong with the latter, it’s that discernment has taken a backseat to access; we want all the apple pie recipes, all the videos and photographs and articles and books. We are here now. Entertain us.

. . . .

People have always felt a sort of ownership over art, and that’s actually good. It’s why you keep a book on your shelf and return to it, it’s why you hang a picture on your wall that speaks to you. But when this gets out of hand and you mistake access or a personal connection with your rights, as happens so often in our Internet age, it leads to a dangerous sense of entitlement. That’s why readers feel empowered to complain, directly to the creator, that a book or show doesn’t have absolutely everything they want: the romantic pairing they’d hoped for, the language they find most friendly, the ending they desired. And it’s also why, for instance, the last Harry Potter book leaked on the internet before it was officially published: fans saw the book as something they were owed, not the product of labor that deserved compensation. Not that J.K. Rowling needs more money—but she, and all authors, deserve to have their work recognized as work.

. . . .

Consumers hold a pernicious power, so this trend towards free content won’t reverse itself unless we want it to. This is a sad thing, and we will all be much worse off if we can only hear stories from people who can afford to write. Nicholas Weinstock, a Guild Council member, said: “Reducing the monetary incentive for potential book authors even to enter the field means that there will be less for future generations to read: fewer voices, fewer stories, less representation of the kind of human expression than runs deeper and requires and rewards more brain power than the nearest bingeable series on Netflix or Amazon or GIF on your phone.” Maybe we will all get what we think we’re entitled to — free art — but what kind of art will that be?

Link to the rest at Electric Lit

While we will never know for certain, PG suggests that the rise of Amazon has increased the number of books sold in the United States (and maybe elsewhere) by a substantial margin. Absent Amazon, fewer people would be reading books today.

Not everyone enjoyed the trips to the bookstore in pre-Amazonian days. If a reader’s interests were much out of the mainstream, there weren’t many books available. If finances were a little tight, a shopper might not be in the mood to pay.

PG just checked the Top 10 Hardcover Fiction Bestsellers at Barnes & Noble. The average suggested retail price for the Top 10 was $25.59.

For some visitors to TPV, paying almost $26.00 for a novel would seem reasonable. For others, it might not.

Let’s assume we have an avid reader of fiction who reads four books per week. Even PG can do the math in his head.

Over $100 per month for books. Almost $6,000 per year for books.

Who knows more about pricing anything to maximize sales, the CEO of a New York publisher or Amazon?

Who knows more about pricing anything to maximize profits, the CEO of a New York publisher or Amazon?

Traditional publishers try to cultivate a particular image of books as a unique product, unlike any other. (Corinthian leather!)

Like it or not, books are a mass-market product that competes for consumer dollars. Books don’t just compete with other books. Books compete with every other product a consumer might be thinking about purchasing.

If you want to price for the carriage trade, open an art gallery. The New York book business doesn’t work without lots of titles that sell in the tens of thousands or hundreds of thousands. That’s a mass market.

PG suggests that “Amazon is causing the sky to fall on the book business” is erroneous. If the traditional book business is to be saved from its own management over the next ten years, Amazon will do the saving. A book business that sells an electronic version of its principal product for $3.00-7.00 has a better future than one which appears to prefer selling a physical copy of its principal product for $28.00.

 

New, Larger Authors Guild Survey: Falling Incomes for US Writers

9 January 2019

From Publishing Perspectives:

In one of those quirky coincidences of news coverage, a familiar number has arisen in the top-line reporting from the United States’ Authors Guild about author incomes.

. . . .

Since 2009, their newly released report says, median incomes for authors from writing have fallen by 42 percent.

And when the United Kingdom’s counterpart survey results were announced in June of last year, the Society of Authors reported that the Authors Licensing and Collecting Society had found that median incomes for professional writers since 2005 had dropped the same amount: 42 percent.

. . . .

The sample comprises input from 5,067 published book authors. For the first time, the [Authors Guild] expanded its survey range, requesting responses not only from its own membership but from members of 14 additional writer organizations. That overall group numbered 9,288 people.

. . . .

·         53 percent said they consider authoring books their primary occupation, spending half or more of their work time writing

·         56 percent said they write fiction

·         18 percent said they write literary fiction

·         38 percent said they write genre fiction

·         22 percent said they are academic, scholarly, or textbook authors

·         18 percent said they write general nonfiction

·         9 percent said they publish books to advance their work or personal brand

·         46 percent said they’re traditionally published

·         27 percent said they are strictly self-publishing

·         26 percent said they are both trade- and self-published—the guild notes that “slightly more than half of the respondents have done some self-publishing”

Taken together the responses reported by the full sample of participating published authors indicate that their median income from “all writing-related activities” was US$6,080, down three percent from the guild’s sruvey work in 2013, and down from $10,500 in 2009.

. . . .

There is what appears to be a brighter spot. Authors identifying themselves as full-time, when reporting “all writing-related activities,” showed a median income that was up 3 percent over 2013, coming in at $20,300. The guild points out, however, that this is still substantially lower than the $25,000 median income that class of writer reported in 2009.

. . . .

Self-published writers responding to the survey overall reported earning 58 percent less than trade-published authors in 2017, even while citing what the guild says was a 95-percent increase from 2013 to 2017. (In the top decile, the indies had a median of $154,000 while the trade-authors reported $305,000.)

Not only did self-published romance and romantic suspense writers report median incomes “almost five times higher than the $1,900 median author-related income for the next highest-earning self-published genre category of mysteries and thrillers,” the guild writes, but “the median author-related income for self-published romance and romantic suspense writers was only $50 more in 2017 than in 2013, which may indicate that self-published romance writers as a group have reached a plateau for earnings under current business models.”

. . . .

The organization also points to “blockbuster mentality” as hurting authors, along with those stubbornly low ebook royalty rates of 25 percent and increases in deep discounting.

. . . .

Cal Reid at Publishers Weekly does a good job of summing up the Amazon-related commentary of the survey, “Unsurprisingly, Amazon—described as a dominant force in bookselling and book publishing—figures prominently in the income survey, cited as both a positive and a negative force.

“Amazon has ‘democratized’ publishing, enabling more people to publish books than ever before and the survey found that 76 percent of self-published authors used one of Amazon’s platform. Amazon’s requirement that authors sell exclusively on their platforms limits the amount of money they can make by being forced to participate in Kindle Unlimited and receiving only a 35 percent royalty on books priced at over $9.99, the report says.

“Moreover, the survey found, Amazon’s dominance over online bookselling (the e-tailer controls 72% of the online market, the report found) forced traditional publishers to effectively suppress the income for traditionally published writers. ‘Amazon puts pressure on them to keep costs down and takes a large percentage, plus marketing fees, forcing publishers to pass on their losses to authors,’ the report said.”

. . . .

Over 2,000 authors had average publisher royalties of almost $32,000; close to 1,700 self-published authors reported royalties of just over $31,000.

Link to the rest at Publishing Perspectives

PG suggests traditional publishers could increase the royalties they pay to provide increased income for traditionally-published writers.

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