The Business of Writing

Your Basket is Leaking

2 December 2018

From Kristine Kathryn Rusch:

In October 2018, Sears filed for bankruptcy. The form of bankruptcy the corporate heads chose was something called Chapter 11 here in the U.S. It means that the company—once the largest retailer in the entire world—will be able to reorganize and, if they’re lucky and the folks running the company are smart, they might be able to emerge from bankruptcy with some of the business still intact.

The key here isn’t the details of Sears’ bankruptcy. It really isn’t even Sears itself which, when I was a child, fifty years ago, was a fixture in America. It’s the trajectory of the company.

. . . .

By early 1940s, Sears’ catalogue became  known as the Consumer’s Bible. In the 1950s or so, Sears started opening brick-and-mortar stores, and by the mid-1970s, the brick-and-mortar business overshadowed the mail order catalogue.

Mismanagement, a failure to keep up with the times, and a large corporate structure led to a decline starting in the 1980s, exacerbated by the rise of Wal-Mart in the 1990s. Sears still had a lot of value after the turn of the 21st century, but not in retail. The value was in its properties and its stock, and eventually that declined as well.

And now, Sears—mismanaged to pieces, its mail-order business (and famous catalogue) a distant memory—has almost thrown in the towel. They’re fighting for their existence. Very few adults alive remember the store in its heyday.

But look at that trajectory. Mail order on one item only. Then more items. Then unrelated items. Then becoming one of the biggest companies in the world. Then adding brick-and-mortar.

Does that sound familiar? Think of it this way: instead of mail order, think online. Instead of watches, think books. And then realize that Amazon shares much of Sears trajectory, only on a slightly accelerated pace—and without the name changes and the obvious added partners.

Sears to Wal-Mart to Amazon. There is a direct line. Wal-Mart is still fighting for dominance, but they’re no longer fighting Sears. They’re fighting Amazon. And Amazon is probably fighting some other company with a good idea, some company that I’m not entirely aware of.

Why is that important?

Because currently, Amazon is the biggest online retail company in the world. (Wal-Mart is still the largest retailer, but Amazon has moved up to second there as well.)  Amazon is exceedingly important to the indie writer movement. In fact, indie publishing would not be where it’s at without Amazon’s innovation with the Kindle ereader ten years ago.

In that time period, a lot of self-published authors have used Amazon’s ecosystem to make themselves, if not wealthy, then at least comfortably well off.  Many of those writers don’t even market their work outside of Amazon at all, preferring to use the tools provided by Kindle Select to promote their series and their work.

Early on, writing advice for indies (as I’m going to call writers who work outside of traditional publishing) centered on an Amazon-only strategy. If you look at my earliest blogs on the publishing industry, back in 2009/2010, you’ll see me constantly defending myself against that very argument. I learned as a young freelancer to go wide—and that was back in the early 1980s. Relying on only one source for income—no matter how large that source is—is never a good idea.

. . . .

Having been in traditional publishing, with its weird rules and limitations, meant I had learned early on how angry readers get when they can’t get a book that they want. I didn’t want to replicate that experience for them, particularly as I took back control of my publishing, so I never even considered Select.

Although, I had to admit, I was envious at times of writers who could manipulate that system to raise their profiles—at least on Amazon. It would have been nice to have access to the same tools. Eventually, I developed a few new pen names (for a variety of reasons, and no, I’m not telling you who they are), and they experimented in Select.

The Select promotion tools are good until they’re not, as everyone who plays in that ecosystem knows. Amazon changes the system, and then the indies figure out how to best use that system, and then Amazon changes it again.

There have been complaints about Amazon and its practices from the start. But savvy writers have known that Amazon started this revolution, and no matter what they’ve done, we all owe them big for that.

But…then there’s the argument I’ve been making on this blog since at least 2010. Do not put all your eggs in one basket. Even if that basket is the biggest online retailer in the world.

I still get pushback on that advice. But not as much as I used to. Because some of the big pro-Amazon indies are beginning to see cracks around the edges of Amazon. There’ve been too many changes to Select, too many broken promises, too many costly mistakes.

Some of the formerly pro Select-only gurus are now quietly going wide. A few others, trapped in the ecosystem, are using other tools to make their novels available before they put the books into Select. They’re still gaming Amazon’s system, but they’re gaming it to keep the income coming—until they can move out of the exclusivity trap that they had allowed Amazon to build around them.

For the writers, though, who continued to argue that Select was the only viable place to play, October and early November were a difficult time. Writer after writer here in the U.S. noted that their international sales had declined dramatically.

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.

PG says that very few, if any, large organizations are unchanging.

Since he has watched the tech world, from the inside and the outside, for a long time, he has seen a great many changes.

Microsoft is not the same organization it used to be. Neither is Apple.

WordPerfect was a wonderful product and a superb organization in its day, but it’s gone now. Ditto for Lotus 1-2-3, Novell and Netscape. In some cases, former tech giants continue as zombie caricatures of their former selves, but the spark is gone.

The personal influence of a strong executive can profoundly shape an organization. Think of Sam Walton and Walmart. When that entrepreneurial executive leaves or dies, it is quite common for such organizations to change. The Sam Waltons and Steve Jobs of the next decades aren’t working for today’s Walmart and Apple. They wouldn’t fit.

Jeff Bezos and Amazon have a similarly tight bond. Amazon has mirrored Bezos’ personality in many ways.

But Amazon has become an extremely large company and the Bezos influence travels through lots of management levels and and subordinants’ decisions before it reaches indie authors and individual consumers. Bezos simply can’t know about everything Amazon is doing today and he’ll know even less next year.

PG thinks the Amazon plan to have two headquarters locations, which later morphed into three headquarters locations is Exhibit A in demonstrating that Bezos has taken his hands off the wheel.

While widely-dispersed major “headquarters” locations may make it easier to tap into a larger geographic pool of talent to fill the entry-level and middle-management jobs, PG suspects it’s going to be a management mess with queens and kings of little Amazon kingdoms sprouting everywhere.

Bezos’ ability to effectively provide vision, leadership and shape Amazon’s corporate culture is going to be substantially diminished. Any future Jeff Bezos-type Amazon employees who might have the talent to continue the level of innovation and organizational excellence he established are not likely to rise through this type of management structure. And their chances of catching Bezos’ attention and obtaining his help in rising through Amazon by their job performance will be slim.

 

Six Myths  (and a Few Facts) About Traditional Publishing

2 December 2018

From BookBaby Blog:

Despite the constant upheaval that defines the current publishing landscape, many authors (and would-be authors) labor under some old “assumptions” about traditional publishing that are simply no longer relevant.

Myth #1: Traditional publishers serve as “gatekeepers”

As the argument goes… with a bloated book marketplace being invaded by millions of self-published titles, readers can depend on publishers to maintain quality literary standards as they allow only the best stories to be told through well-written tomes. This is false for many reasons.

First, publishing is a cold business. There is no noble mission to protect readers from bad books. Publishers put out books they think will make money — for the publishing house, maybe the bookstore, and possibly the author.

It’s true that traditional publishers are full of book professionals, some of whom are pretty good at spotting talent. The best placement editors also have an instinct for what the market will consume. They’ve published a lot of wonderful books. They’ve also published a lot of stinkers.

But if the gatekeeper myth were true, surely no good manuscript would ever be rejected, right?

. . . .

Myth #2: You can only make the big bucks through traditional publishing

The truth is, thanks to today’s self-publishing revolution, you have an equal chance at huge sales results no matter which route you choose: traditional or independent publishing. In fact, the vast majority of authors will tell you there isn’t a lot of money to be found in a traditional book deal. Sure, you get an advance check, which averages around $5,000-$10,000, but you have to earn that back before you see another dime.

Moreover, the royalties associated with publishing through one of the major houses are paltry. If you publish through a large publishing house, you can expect to make $1-$2 per book sold. To make matters worse, most publishers only pay authors twice a year, so you can’t expect to see your monthly income increase because of your book.

It got to the point that, in 2016, the US Authors Guild sent an open letter to the Association of American Publishers demanding better contract terms. In the letter, these writers stated, “Authors’ income is down across all categories. According to a 2015 Authors Guild survey —  our first since 2009  — the writing-related income of full-time book authors dropped 30% over that time period, from $25,000 to $17,500.”

. . . .

Myth #5: Once you land a book deal, your author career is set for life

Loyalty to authors is, largely, a thing of the past. The duration of a traditionally published author’s career is controlled by his or her publisher, and it’s usually all about sales of the latest book. If your new book doesn’t perform well, the publisher will not want your next one.

In fact, your first book must perform exceptionally well before the next one will be considered for publication. And the odds are long: only one to two percent of all books published become bestsellers.

Link to the rest at BookBaby Blog

How to balance full-time work with creative projects

28 November 2018
Comments Off on How to balance full-time work with creative projects

From Fast Company:

“Teacher burnout” refers to a state of chronic physical and emotional exhaustion brought on by prolonged periods of stress. Combined with low wages, inadequate funding, and disheartening educational policy, burnout has resulted in eight percent of teachers in America throwing in the towel over the past decade.

As a teacher myself, it’s been interesting to reflect on what keeps me coming back to the classroom, five years into this difficult yet ultimately rewarding job. What it comes down to, I think, is that teaching is not the only thing that keeps me going. In my opinion, relying solely on a day job or career to fulfill your ambitions and keep you mentally stimulated is risky business. Instead, I like to incorporate a smattering of fulfilling creative projects within my day-to-day life to help me keep my teaching job in perspective. And while it isn’t always easy to do it all, there are ways to balance things out.

Over the past few years, in addition to teaching full-time, I’ve managed to finish a master’s degree, start a record label, contribute to various publications, and release/perform music as Nassau. Through it all I’ve practiced, failed at, and re-tooled strategies for balancing full-time work with multiple creative side projects. In this guide you’ll find a handful of takeaways for staying sane, organized, and intentional while trying to do it all.

BE HONEST ABOUT YOUR 9 TO 5

Your day job matters a lot

It really does! The average person will spend over 90,000 hours, or about a third of their lives, at work. With another third of our hours spent sleeping, the time we actually have for “living” seems modest at best. If you’re holding down an unfulfilling 9-5 with the primary ambitions of supporting yourself and your creative work (versus building a career in that area), ideally this job should provide you with at least one of three things: more time, more resources, or a skill set that will help you be successful in your creative endeavors.

As you contemplate what type of day job might make sense for you, consider the feelings you’ll want to have after completing a shift, or after heading out from the office. Probably “drained, grumpy, and sick of everyone” are not feelings that are on your list. So think about it: What type of work or situations might you seek out that wouldn’t leave you in a bad mood after working? By spending some time brainstorming about the job that could be a nice complement to your personality and side projects, you’ll put yourself in a better position to find the right type of gig.

. . . .

Finding the right gig to nicely balance with your personality and creative work isn’t going to happen overnight. As you work towards finding the right role, pause and reflect on your thoughts and emotions whenever possible. In each type of positions, ask yourself: Were there new trends in your behavior? Did you notice an uptick in your creative work and productivity outside of your 9-5?

As you think about what type of day job might make sense for you, a simple exercise to try starts with taking inventory of your skills and passions. Write them down. Go for quantity here: What are you good at? What comes naturally? Anything goes. Then look for patterns or themes. You may even group your skills into categories including “things I love doing,” “things I get paid the most for doing,” “skills I want to improve,” or “skills I haven’t used in a long time, but would like to use again.” Identifying patterns will enable you to honor and recognize the expertise you already possess, and can help you find employment that complements not only you as a person, but your creative practice as well.

As you do the above exercise, you should also be honest with your intentions, and even name them. Would you like a job that makes you lots of money? Expands your network? Gets you working with your hands? Trust your brain and your body–you’ll thank yourself when you’ve landed the right job that’s actually helping you get what you want (not just what you think you should want), and are also able to have time and energy to produce creative work you’re proud of.

Link to the rest at Fast Company

JK Rowling sues former employee for £24,000

10 November 2018

From the BBC:

Harry Potter author JK Rowling has launched a £24,000 legal claim against a former employee for allegedly using her money to go on shopping sprees.

Ms Rowling, 53, claims Amanda Donaldson broke strict working rules by using her funds to buy cosmetics and gifts.

Ms Donaldson worked as a personal assistant for the writer between February 2014 and April 2017, before being sacked for gross misconduct.

. . . .

Legal papers lodged at Airdrie Sheriff Court allege Ms Donaldson wrongly benefited to a value of £23,696.32 by spending on a business credit card and taking Harry Potter merchandise.

. . . .

It is claimed Ms Donaldson had responsibility for funds and was provided with a credit card for buying items in connection with business and personal affairs only.

She had to submit statements and receipts once a month to the accountants and also had access to a safe containing foreign money.

But discrepancies were picked up in February last year on statements revealing a high volume of personal spending by Ms Donaldson.

She had a meeting with an accountant to discuss use of the card and was suspended.

Ms Rowling has alleged Ms Donaldson made a series of unauthorised payments, including:

  • £823 at Bibi Bakery
  • £1,482 at luxury candle company Jo Malone
  • £3,629 in cosmetic firm Molton Brown
  • £2,139 in card shop Paper Tiger
  • £1,636 in Starbucks.

Ms Rowling also claims Ms Donaldson, who controlled memorabilia requests from fans, used her position to steal a Harry Potter motorised Hogwarts Express worth £467.56, a Harry Potter Wizard Collection worth £2231.76 and a Harry Potter Tales of Beedle The Bard Set worth £395.

. . . .

It is alleged Ms Donaldson bought two cats worth £1,200.

Link to the rest at the BBC

Getting To The Stories You Love

9 November 2018

From Kristine Kathryn Rusch:

One of the comments I heard the most at this year’s Business Master Class was a bit wistful. And the comment usually came in a discussion about something else.

  • I sure would like to get to the place where I can do what you folks do: where I can write what I love.
  • As soon as this [insert detail] is over, I might be able to write what I love.
  • Writers who write what they love are really lucky. Sure wish I could get there.

Over and over and over again. Those phrases have been going round and round in my head, partly because I have a lot of compassion for the speakers, and partly in conjunction with other things that have happened this past year.

About a year ago, I wrote a blog post on burnout.  It, and the subsequent posts, got reprinted in the magazine for the Romance Writers of America, the Romance Writers Report or the RWR. I got a lot of email from the original blog posts and from the RWR reprint. I had hit a nerve.

I was aware of the nerve, but not thinking about it too much, except to realize that so many writers were on the hamster wheel of doom—trying very hard to write more and more and more to make the same amount of money they had made a few years ago. We’re in a mature market now, and the highs aren’t as high (and the lows aren’t as low). Things do change, sometimes daily, in this new world of publishing, but the business models remain the same.

Dean and I have also been planning a new series of online courses which we call the Futures courses. We learned long ago that most writers don’t look very far ahead in their careers. Writers have no idea how to sustain a career past the first few years. That kind of long-term career takes not only planning, but a certain mindset, which some writers never learn.

. . . .

It’s also not fun to do something because you have to do it or lose everything. It’s better to do something because you want to, or you have hit that point in your career (or in life) that makes a change possible.

As Dean and I planned  these futures workshops, we had discussion after discussion about what’s going on in indie publishing right now. In addition to the burnout, lots of writers who were the early adapters of self-publishing have disappeared. They quit, pulled their books down (!), pulled down their websites, and moved onto other things.

Even the early gurus of self-publishing have either given up or gone back to traditional publishing in whole or in part. Considering how outspoken some of them were about the evils of traditional publishing, you (I) have to wonder what caused the shift. And the silence. None of them are blogging any more.

I suspect I know. Because Dean and I have been around forever, we’ve seen a lot of writers come and go. In traditional publishing, the average length of a writer’s active career is about ten years. That clock usually starts with the first major professional sale, and ends when the writer either can’t handle the crazy of traditional publishing any more and/or when the writer can no longer sell a book to any traditional publisher due to a variety of factors (including but not limited to declining sales numbers, burnout, difficulty of working with the author, burnout, difficulty of working with the publisher, burnout).

. . . .

The thing Dean and I have come to realize is that indie careers have a shelf life as well. Most indie writers seem to be disappearing after five to six years of really hard work.

Much of that is burnout. Some of it, though, is that hamster wheel of doom and the mature market. When a market is new, it’s in a boom cycle and everyone gets rich. When a market is mature, it’s in a sustainable place where some get rich, while others make a healthy living, but nothing more.

The tricks of the boom cycle don’t work in the mature market, and making the shift to a different way of doing things is hard.

I’ve examined those things in the past, but the one thing I didn’t examine is a whole different side to the hamster wheel.

Writers who make a good living writing something they don’t want to be writing. Writers who aren’t writing what they love.

I think every long-term writer has gone through this phase, and the writers who end up with decades’ long careers have figured out a way through it.

. . . .

I’m seeing indies hit the same problems. Sure, they might have liked writing billionaire erotica a la Fifty Shades of Gray, but after a book every two months for the past five years, writing that subgenre has gotten old. And the indies find themselves in the place that Dean (and I) found ourselves in years ago: they’re making such a good living at what they’re doing that walking away is hard.

Or walking away will be detrimental to their families. I was single when I quit writing nonfiction. The only person who might have gotten hurt when I cut my expenses and took a day job was me. At that point, I rented an unfurnished apartment and couldn’t afford to buy a couch. I lived with one living room chair and a futon on the floor for a year—not something someone with a spouse and two kids can do.

That trapped feeling—the feeling that you have to keep writing this particular thing, whatever it is, no matter what—makes everything worse. You got into writing for the love, and now it’s no fun at all, but you need the income.

You are trapped by your success and that’s harder to get away from than being trapped by failure.

. . . .

The one option that is not sustainable, however, is to continue writing books you no longer enjoy writing with no way to get to writing what you love. At some point, you’ll have to add in writing books of the heart. If you don’t, you’ll burn out and vanish like so many indies before you.

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 PG previously mentioned, he spent an enjoyable week in October attending and presenting at the Business Master Class conference mentioned in the OP, organized by Kris and her husband, author Dean Wesley Smith. In addition to their writing, Kris and Dean regularly hold workshops on various topics for authors. See WMG Workshops for more information.

PG has a couple of responses to the OP.

Where is the Revolution Today?

The Passive Voice sprang from PG’s fevered brain in 2011. Since its beginning, PG has uploaded almost 18,000 posts, proof that a little OCD can go a long way.

The first post on TPV was titled, Imagine There are No Bookstores , based on a now-disappeared post by a small publisher which discussed Amazon ebooks and their potential impact on traditional publishing and bookselling.

This post appeared in February, 2011, the same month that the Borders bookstore chain filed for bankruptcy. This bankruptcy would remove 650 large bookstores from the market within a very short span of time. Publishers large and small took large writeoffs for books Borders had sold but would never pay for.

In the previous year, 2010, Amazon reported $14.9 billion in book sales.

In 2010, Barnes & Noble had 720 trade bookstores plus 637 college bookstores (acquired in 2009). Barnes & Noble launched its ebookstore in 2009 as well.

Barnes & Noble reported 2010 sales from its trade bookstores of $4.3 billion, down 4.5% from the prior year.

In 2018, Barnes & Noble, still the largest bookstore chain in the US, continues its long decline.

In 2018, Barnes & Noble had 630 trade bookstores. Barnes & Noble spun out its college bookstores into a separate independent business in 2015.

Barnes & Noble reported fiscal 2018 (April 2017-April 2018) retail sales of  $3.5 billion, down 5.4% from the prior year.

Amazon no longer publishes its book sales numbers in its annual reports to securities regulators or elsewhere that PG was able to locate, likely because, compared to the rest of Amazon’s sales, book sales are not large enough to be material from a financial point of view.

The Bookseller reported that Amazon’s 2017 revenues from book sales were up 46% in the UK.

In sum, the retail book business today is increasingly centered on Amazon.

Physical retail bookstores are in a continuing long decline. Publishers Weekly reports that, in 1991, there were 11 US bookstore chains that had 13 or more outlets, with total outlets topping 3,000. In 2017, the five chains on Publisher Weekly’s book chain list had 1,076 outlets. Just since 2011 the store count has fallen by 32%.

PG is going to cut off his expatiations at this point and continue them in another post.

Suffice to say, PG doesn’t believe that the revolution is over for authors and publishers. Electronic and communications technologies will continue to grow apace over at least the next several years and the population at large will continue to want stories, so the future is still bright for storytellers.

 

 

 

 

How Do We Measure Commercial Success in Publishing?

31 October 2018

From Publishing Perspectives:

Given all the problems, how is it that publishers rarely go broke? Even if they’re losing money, invariably someone steps in to buy them. Of course the purchaser may be mad, but the big publishing acquirers are themselves still in business and by all accounts performing well.

So what is the trick and how do we measure commercial success? There seem to me to be five measures, all important but all with shortcomings.

When you ask a literary agent or an author how well a book is doing the answer is usually measured in number of copies sold—either large to show excellence or small, the publisher’s lack of marketing effort. Of course numbers of copies is now a fairly meaningless measure, except to emblazon on the covers of bestselling novelists, as it’s perfectly easy to sell tens of thousands of copies as an ebook at one cent each.

Even when the books are sold at a reasonable price, the numbers may well camouflage an outrageously high advance or huge imminent returns from retailers, either of which would lay the publisher low. I remember a distinguished publisher telling me with pride that one of her books had sold 70,000 hardbacks. I discovered later that 65,000 copies were returned and the advance was £400,000 (US$513,000). The resulting loss was greater than the profit made on many a successful commercial novel.

A better measure, of course, is net sales value and it’s certainly true that increasing sales revenue is a good thing in most cases—but not when the increased sales are made by absurdly high discounts to retailers or by dumping stock and destroying a market.

And so we move on to profit, the measure most focused on by publishing managers at all levels and in all departments.

Not everyone understands profit. Highly intelligent journalists and politicians confuse profit and sales when discussing how little tax some corporations pay. The problem with profit as a measure is that it can be subjective. How publishers account for stock, authors’ advances, capital expenditure on computers and warehouses, plus central overhead allocation—all can distort profitability in one direction or another.

Of course, the single biggest beneficiary of overstating profitability in the UK is Her Majesty’s Revenue & Customs agency, and the reason profitability is so important is that governments use it to calculate taxation.

No truly independent business would use profit as the key measure of success.

. . . .

Arguably the only thing that matters is cash generation and publishers are pretty good at generating cash as, by and large, there’s little need for significant capital expenditure. We don’t need to build factories or have huge non-revenue-generating R&D departments (unless we view editorial as that). And so any surpluses generated by sales of books should turn into cash as long as the surplus isn’t eaten up by over-printing and unrecoverable advances.

But building up cash reserves is not in itself an indication of success.

What really matters, in my opinion, is the building up of publishing assets—the author contracts in filing cabinets (or preferably on a secure hard disc), the licenses, the distribution arrangements, the brand value of imprints.

Of course, these assets are hard to value. With a public company, the share price is some indication, but we all know that financial markets are imperfect and are affected by short-term external factors and sentiment. With private companies, there’s not even that objective approximation.

It’s precisely because asset value is so hard to measure that it rarely gets the attention it deserves but that doesn’t mean it should be ignored. Truly understanding asset value is what distinguishes a good publisher.

A favorite example is Penguin’s acquisition of Frederick Warne in 1983. I don’t have access to its accounts back then but I’ll wager that sales were static, profits were minimal, cash generation was zero. Frederick Warne did however have an asset: Beatrix Potter’s Peter Rabbit series and a few others), which Peter Mayer recognized as a publishing jewel ready for commercialization.

The asset value of Frederick Warne was hugely greater than any of the traditional measures of success would have indicated. Both Peter Mayer and Peter Rabbit emerged triumphant.

Link to the rest at Publishing Perspectives

As regular visitors will have noted, this business relationship between the author and publisher generates far more money for the publisher than the author.

Copyright Savvy

27 October 2018

From Kristine Kathryn Rusch:

Gloria and Emilio Estefan have an estimated net worth of 700 million dollars. Jimmy Buffett has an estimated net worth of 550 million dollars.

What do those artists have in common? They kept control of the copyrights to their songs. They maintained control of those copyrights starting in the 1970s, when other musicians signed away those rights because they were told that to keep those rights was a deal breaker.

Both Buffett and the Estefans walked from deals that wouldn’t allow them control. They understood the value of hanging onto the work they created—and they eventually learned how to leverage those works into a variety of other businesses.

. . . .

For example, Buffett maintained the rights to “Margaritaville,” which was such a major hit in 1977 that it seemed to be on the radio 24/7. Songs that sold better in 1977 aren’t even played much anymore, including “Undercover Angel” (yeah, that song), and “Best of My Love.” Yet “Margaritaville” has spawned restaurants, hotels, and casinos, as well as a tequila brand, beach wear, and shoes, among other things.

And Buffett didn’t just expand his empire with that one song. For example, he now has a bunch of bars named for a hit song he had with Alan Jackson called “It’s Five O’Clock Somewhere.”

The licensing and business opportunities don’t keep Buffett from pursuing his art. He still writes songs, and tours, playing music and managing his empire (which has more than 5,000 employees).

All because he was both savvy enough and desperate enough to hang onto his copyrights.

Fiction writers who are traditionally published rarely hang onto their copyrights these days. It’s almost impossible to do so and sell a book into traditional publishing. The contracts have changed so much from the 20th century that writers are essentially signing their rights away just to get $5000 and the chance to see their books “in print.”

. . . .

But with the disappearance of major bookstore chains, and the decreased distribution of paper books, as well as the downward sales trend of overpriced ebooks, you’d think that traditional publishers would go the way of the Dodo, but they’re not.

And why not?

Because their business model is changing.

The major traditional publishers, the ones we call the Big Five or Big Four or Big whatevers, are part of international conglomerates. And those conglomerates have become rapacious—not for works they can publish effectively—but for intellectual property.

Since the rise of Silicon Valley and the growth of venture capital in the past decade or so, intellectual property has become a valuable commodity. Technically, it was always a valuable commodity, but convincing courts and financiers of that used to be difficult as hell.

Not any longer.

In fact, the growth in IP (intellectual property) valuation—figuring out (guessing) how much a particular intellectual property will increase in value over the 70 years after the author dies—has become a business in and of itself.

. . . .

What the large traditional publishers are doing, though, isn’t copyright theft at all. They’re taking advantage of writers’ ignorance. They’re legitimately buying all of the licensing rights in a copyright, and hanging onto those rights for the term of the copyright. They are transferring value from the writer into their own traditional publishing company.

Publishers aren’t the only ones doing this. Major literary agencies are doing the same thing. Their contracts with writers call for a shared piece of the copyright of anything they represent, usually 15% of that copyright.

Fifteen percent of Jimmy Buffett’s net worth is 82.5 million dollars. And that’s in 2016 numbers. Who knows what 15% of his empire is worth in 2018 dollars.

. . . .

Those traditional publishing companies are gambling on the ignorance of the writers. The companies, remember, are small cogs in the gigantic wheel of a conglomerate. And those conglomerates aren’t just random compilations of unrelated businesses. Most of them are multimedia companies. They own gaming companies, TV networks, movie studios, and all kinds of other media companies that will allow them to easily activate parts of the copyright to a book that writers would normally sell separately.

These conglomerates want properties they can then turn into franchises. Right now, the book publishing arms are terrible at knowing what kind of IP they actually have. For example, if there is suddenly a poodle craze across the U.S., most publishers have no idea if they have novels featuring poodles.

But give the companies a decade or so. I’ve already heard of employees coming into the companies to go through the IP and list the keywords about each property. At some point in the not-so-distant future, someone at a traditional publisher might hear about a poodle craze, and have an employee compile a list of all of the poodle IP in stock. Those books might be reissued or licensed for film or become graphic novels or t-shirts or stuffed animal poodles—and the authors might not see a dime from any of it, because of the contracts they’ve signed.

. . . .

So…while writers and editors are lamenting the possible demise of Barnes & Noble, and are actively wondering what will happen next to these “endangered” traditional publishers, the conglomerates that own those publishers are increasing in value with each book contract signed.

Traditional publishing as we knew it in the 20th century is long dead. The possible demise of Barnes & Noble is just a last gasp of the old order disappearing.

Traditional publishing in the 21st century shouldn’t even have the word “publishing” attached to its name. The publishing part is skimped over, so that the asset gets activated. Then it becomes part of the company’s portfolio.

Personally, I’d rather keep my own copyrights and control of my own work.

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.

$400M Fiction Giant Wattpad Wants To Be Your Literary Agent

1 October 2018

From Forbes:

It took a less than an hour in 2013 for Anna Todd to change her life. The Army wife and part-time babysitter had spent a lot of time reading fan fiction, stories by amateur writers about existing fictional universes and real-life celebrities. So her erotic tale about Tessa and Hardin—a wholesome college freshman and a tattooed bad boy who is a thinly veiled stand-in for singer Harry Styles—came together quickly when she sat down to type the first chapter of After on her phone. Todd posted it to Wattpad, one of the world’s largest destinations for online reading and writing.

After has since been read more than 1.5 billion times on Wattpad. It’s now a bestselling book series, with 11 million copies sold after Wattpad brokered a mid-six-figure deal for Todd with Simon & Schuster. She fully credits Wattpad with getting her in the door. “If I had sent After to any publisher, there’s no way they would have even read it,” says Todd, 29. Wattpad got paid for its work, taking an estimated 15% of Todd’s book earnings–about what a typical literary agent would charge—and it’s also a producer of the After movie that began production in June. The lucrative evolution from Wattpad post to mainstream book to Hollywood movie is precisely what Wattpad wants to see more of.

“We had built the audience for the writers, the platform for them to share their stories,” says Wattpad cofounder Allen Lau, 50. “But we did have the idea, ‘Hey, we have millions of stories already. Perhaps we can expand that.’”

Wattpad’s 65 million active users (most of them women under 30) spend 383 million hours a month on its site and its mobile apps, reading pieces like “Brave,”a yarn about the Harry Potter character Neville Longbottom, and “Taking Selfies and Overthrowing the Patriarchy With Kim Kardashian.” Wattpad has more than 4 million writers, who post an average of 300,000 pieces a day. The company brings in an estimated $19 million in revenue, mostly from ads on its site and from stories sponsored by companies like Unilever who want to advertise alongside a specific writer or genre. Nearly all its writers are unpaid; several hundred make money from ad-sharing revenue and 200 of those also earn from writing sponsored content and inking publishing deals with Wattpad. That lean business model means Wattpad is profitable. It has few costs beyond bandwidth, its 130 employees and the Toronto offices. The model “is a great way to seek talent without having to pay huge amounts for it,” says Lorraine Shanley, a publishing industry consultant.

. . . .

Since Wattpad doesn’t own the rights to the stories on its site, it’s morphing into a talent agency for its authors, cutting out the famously fragmented and high-touch world of literary agents. By bypassing the middle man, Wattpad can funnel the most popular pieces directly to book publishers and TV and movie studios while taking a cut of the authors’ deals.

. . . .

Lau and Yuen weren’t the only ones plunging into digital fiction. FanFiction.net, where EL James wrote the stories that became Fifty Shades, had launched in 1998. But FanFiction.net rarely updated its site as the Web evolved, and it still looks pretty much like a Web 2.0 message board. Traditional publishers have tried their hand, too. In 2008, HarperCollins launched Authonomy, where users could upload manuscripts and editors would read the five highest-rated stories each month. By the time the site shut down in 2015, the publisher had picked up 47 books for publication. Macmillan’s five-year-old Swoon Reads plans to release 22 titles in 2018, but with more than 70,000 users and 700 manuscript uploads, its reach is far smaller than Wattpad’s.

Wattpad has not only the bigger size but also the burning desire to avoid another of FanFiction.net’s errors: letting a craze like Fifty Shades happen without getting a piece. To that end, Wattpad has put together more than 100 book deals for its authors over the past four years (not including foreign rights deals), likely collecting the typical 15% commission of a literary agent.

Link to the rest at Forbes

 

 

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