The Business Rusch: Writers and Traditional Publishing Companies

The Business Rusch: Writers and Traditional Publishing Companies

Kristine Kathryn Rusch

Once upon a time, not so very long ago, writers had limited choices if they wanted to publish books. Sure, the writer could spend thousands of dollars self-publishing, and wind up with thousands of books in a garage and no place to sell them. Only a handful of writers spaced over fifty years managed to succeed that way.

But for the most part, the writer’s choices boiled down to this: If a publisher offered to buy a book, the writer could decide whether or not to take the offer.  It was pretty simple really: the writer tried to make the offer better, but the situation boiled down to take-it-or-leave-it. Writers with self-confidence left bad deals on the table, but not without anguish.

Writers with business sense often didn’t approach certain publishing companies with their work at all because that publisher was known for screwing the writer, never paying royalties, rarely publishing a book, or making excessive demands on the writer (forcing dozens of rewrites without ever paying, for example). By deeming certain companies impossible to work with, the writer had even fewer choices of places to publish.

At some point in a long-term writer’s career, she could chose between offers on the same book, usually in an auction situation, with a hot property. The savvy writer in that situation would pit publishers against each other to get the best possible deal for the writer. Every writer hoped for such a situation, but when faced with it often had trouble deciding what was best.

The best deal didn’t always equal the most money, although as the decades went on and corporate think took over, the most money and the best deal were often synonymous. (Corporations often put the most money behind that thing they have invested the most money in, not necessarily the best thing, but the most expensive thing.) The best deal usually included a vision, a marketing plan (often negotiated into the contract), escalators on royalties, limited rights purchase, and excellent royalty rates.

None of those things were a guarantee that the book would do well. While the royalty rates and escalators got handled by the accounting department and would happen once the book went on sale, the marketing plan, the vision, and actual support of the book itself often got tossed out the window if the editorial team that bought the book left the company. Some new editorial directors, concerned more with their own careers than the books they inherited, would actively kill a line designed by their predecessor. (This has happened to me personally three different times—fortunately, in two instances, I was able to buy the book back from the publisher before publication.)

These things still happen on both large and small scales. A large-scale case hit the news just last week. Kaplan Publishing, which those of you who have taken the SAT test recognize for its ubiquitous test prep books, tried to add a trade line. The problem is that they did so right at the beginning of the economic collapse.

Kaplan reassessed, as good businesses do, and dropped the trade line this year, firing staff, and disbanding everything from editorial to publicity to sales. The problem was that no one told the authors. One author, Dr. Yvonne Thorton, with a major bestseller to her name (The Ditchdigger’s Daughter) had sold a book at auction to Kaplan, foregoing other companies that offered more money for Kaplan’s better promotion model.

By the time her new book came out, Kaplan had decided to abandon the trade line. By the time she noticed that her book had been published “dead” as the phrase goes, there was only one guy left in the trade arm’s office, and he couldn’t do anything. I suggest you read about this case if you ever think of going with a traditional publisher, because these things happen all the time.

Traditional publishing companies have a lot of inventory—books written by writers—and these publishing companies are dealing with the inventory as they would any other product. The problem is, that for the writer, the inventory, the product, might be the only thing they worked on for the past five years.

Folks, when any business has a term for something, that means the something is common. I’ve had at least a dozen books published “dead” either here or overseas. What happens is that the publishing company has decided to move away from that genre, or the editor left and no one picked up the slack, or the publisher has decided to quickly get rid of “excess inventory,” which your book is part of.  The first time that happened to me, it happened at the end of the horror boom, and my publisher cut their horror line. They published my novel, co-written with Kevin J. Anderson, anyway, with a terrible cover and no support. They dropped the second book on the contract, returning it to us like bad fish.

The next time I had a book published dead, the editor had left, and the publisher loathed the replacement editor.  The publisher decided to destroy the replacement editor’s career, and actively ruined the book line that the new editor was overseeing, so that the new editor could be fired. I managed to buy one book back from that debacle, but another got published dead right into the mess.

The most recent time I had a book published dead was with my novel Fantasy Life, part of Pocket’s aborted modern fantasy line. My novel was supposed to be a hardcover lead. By the time the book came out, the editor had been gone for nearly a year, the publisher had left, and the novel had no editor at all. No one in the house even knew the book existed. Some poor managing editor shepherded the book into print, slapped a bad cover on it, and didn’t even know that my contract and letters back and forth with the team stipulated hardcover first, with tons of promotion.

Once upon a time, back in the land of no choice, a writer had to do what she could to save her career when such things happened. She had to change her name or be savvy enough to see the handwriting on the wall and rescue the book before publication (usually by buying it back and canceling the contract) or find some other publisher to buy a bunch of books before the “dead” book came out, so that the other publisher would throw a lot of money in the mix to save the other books.

A lot of careers ended because writers didn’t know how to handle the situation above.

On the other hand, a lot of careers got made when traditional publishing did everything right. The publisher followed the original marketing plan—or designed a better one. The book sold better than expected and the publisher printed more books to accommodate that. There was good buzz inside the publishing house before the book came out, so someone there decided to take the book out “big”—yet another term, the opposite of publishing dead.

For every sob story, there is a good story of things that went right or better than expected.

Back in the old days, writers effectively tried to hit the lottery with their small product. That was like throwing a toy boat into Lake Michigan and hoping someone noticed. Sometimes someone did. Usually the toy boat sank without anyone noticing.

As I mentioned above, these things still happen—good and bad. But with the option to self publish and make a lot more money, why would an author ever throw her work into that gigantic lake?

The obvious answer is the simple one: If the publisher offers enough money up front, the author might be willing to do so. Although that didn’t work out well at all for Dr. Thorton. Just because a traditional publisher makes promises and throws a lot of money at a book doesn’t mean that the publisher will come through.

But it might be a good risk to take. The chances of a book that gets a large advance—and by that I mean at least mid-to-high six-figures—doing well are much greater than a book that gets a small advance.

But very few writers ever hit that mid-six figure jackpot. Even fewer do on the first novel. Plus, the chances of something going wrong are greater in the current publishing environment as everyone—from publishers to agents to writers—struggles to figure out exactly what’s going on.

I recently went over my fall royalty statements from all of my various traditional publishers. There are some publishers that clearly are underreporting royalties, even though many of us have railed about this repeatedly. Things have gotten so bad that some companies aren’t issuing royalty statements at all. One of my publishers, for example, did not give me a royalty statement for a book that came out in May. (The royalty period ended June 30.) The stated reason? The book hadn’t been on sale long enough to matter.

Um…by contract, I’m due a royalty statement no matter what. Of course, I’m following up on that ridiculousness. (One of many ridiculous things from this traditional publisher, who “forgets” to do things like sending out review copies and nearly forgot to send me a copy edit on the book due out quite soon now. I suspect the fiction line is in trouble at corporate headquarters, because I’ve seen this behavior before—except for the royalty statement nonsense.)

So let me clarify: I went over all of the royalty statements that I received from all of my traditional publishers. These statements covered the first half of 2011.  Then, I chose to examine a statement closely from a publishing company whose royalty statements are accurate. This company is working hard to be transparent, which I appreciate.

The numbers I got from the company for my e-books are in the same ballpark as the numbers I have from WMG on the e-books under the same byline. I’ve seen other numbers which confirm that the numbers I’m getting from this company are accurate.

Using this royalty statement, I did a comparison of the amount of money I would have made if I had self-published the book compared with the amount of money I made because the traditional publisher published it. I did this for the e-book only.

Here was how I figured it: The traditional publisher put a $6.99 price on the e-book, but sold it at $5.49, which I would not have done.  I would have used the $6.99 price, since the book was new. (I put backlist at $4.99; front list at $6.99.)  The contract I signed with this publisher pays 15% of net on e-books, and I had an agent on the deal.

The time period was also short, a little over one month from the time the book came out to the end of the royalty period. That made the comparison very easy.

The sales of this e-book that month were no different from backlist titles by this byline. So the traditional publisher added no value on this e-book (for the front half of 2011).

It seemed like a good opportunity for a comparison.  So I did the math. I was startled by the number that I came up with.

When all of the factors were taken into account, the traditional publisher paid me 10% of what I would have earned on my own had I published the e-book myself. At 70% of the cover price (from Amazon, etc), I would have earned about $800 on that e-book. From the traditional publisher, I got about $80 on the same e-book.

This frontlist book came out in the middle of the darkest part of the publishing downturn, as Borders disappeared (and wasn’t ordering), and Barnes & Noble hadn’t yet determined what they were doing with books. So the paper book only sold 5,000 copies.

Compare that with the first novel published under that byline, which came out more than 10 years ago. At that point, the first novel under that new pen name sold 30,000 paper books in its first month of publication. Different time period, different market, different company, and a completely different world.

Right now, we all—the traditional publisher and me as well—consider that shipment of paper books at that point in time, on an unusual book, a complete success, given the book’s advance and the expectations we all had.  I should also note that I am happy with this company’s marketing efforts, its covers, and the penetration the company got into stores.

Still, that 10% e-book number bothered me, and made me ask the question: What could the traditional publisher do for me that I couldn’t do for myself?

I have some answers to that question, and I’ll be getting to those later on. But looked at from cold financial point of view—and with the expectation of an exponential growth in the e-book market—the traditional publishing route looks like a bad deal.

Yet I’m going to continue to traditionally publish some books, even though I am a midlist author and am not receiving mid-six figure advances on my books.

Why?

Because I’m a fast writer. I can afford to make one book per year (at least) into a loss leader. I look at it this way: Instead of paying an ad company to do the advertising for me, like James Patterson is right now, I’m paying a publishing company to introduce me to a new market, paying with lost revenue. I’m taking a pay cut to find a new market that I wouldn’t have found on my own. Weirdly, by doing this, I get cash up front.

I mentioned last week that the jury is out on whether or not this method works. But that’s really not accurate. With this particular company, I know—because of other promotions and things that are happening in the second half of 2011—that the gamble is paying off.

However, I made the same gamble with another publisher at the same time, and that one is actually hurting my writing career (under a different byline). The e-books are consistently late (months after the paper book comes out, which makes it company policy, imho), hurting e-book sales dramatically. The first book I did with the company went very well. The last two have been a nightmare. No review copies, late production making it impossible for me to do some of the promotion myself, almost no promotion inside or outside of the genre, book design that’s so simple I could do it, covers that are okay but not great, and on and on and on.

I have gotten no added value from this company and I have had a lot of problems. In fact, some of this company’s policies—like the e-book debacle—have actually angered my fan base, which is exactly not what I want.

So, what I have learned is this: some traditional publishers are worth taking a gamble with as the world of publishing changes, and some traditional publishers must be avoided at all costs.

What I look for in a traditional publisher will probably differ from what you look for. But we must all assess the company before we sign a contract. And that’s different than before.

What else is different is this: We no longer need to have a take-it-or-leave-it attitude. Now we can approach each company and every contract with a “what can you do for me?” attitude. It’s the same attitude that Barry Eisler took last spring, when he turned down St. Martin’s Press. He believed that St. Martin’s couldn’t do anything he couldn’t do.

Then Amazon approached him with an offer on that same book, and he made the assessment again, deciding that Amazon could help in areas that he would have difficulties with. He made the right decisions for him all along.

In this new world, writers shouldn’t blindly choose between traditional publishing and indie publishing. Writers need to learn how to assess all the offers that come to them and then see what will benefit the writer the most.

Then the writer is going to have to do something most writers haven’t done in the past: the writer will have to negotiate.

Let me repeat that: The writer will have to negotiate.

That doesn’t mean that the writer must handle the actual back-and-forth herself. She can hire an intermediary, be that an agent or an attorney. But the writer has to control the negotiation herself, and make all the decisions herself.

Why am I stressing that? Because the changes in the industry mean that agents at the moment have a different agenda than the writers they represent. The agent might not want a writer to say no to a $50,000 deal from a traditional company because the agent wants the commission. But if the writer does the book herself, the agent won’t get a commission (or shouldn’t—never give an agent a commission on a book you publish yourself. Ever.)

If the writer hires an attorney to do the negotiation for her, then she has to know what she wants from the negotiation. Because an attorney will only do what the client wants. The attorney makes recommendations, but never takes action on his own. (Unlike agents, who often make decisions without asking the writer at all.)

I know many of you are terrified to negotiate anything. I have several chapters in my Freelancer’s Survival Guide that will help the most timid person learn how to negotiate. You can find them for free on this website, in the entire book The Freelancer’s Survival Guide, or in a short e-book called How To Negotiate Anything. If you’re afraid to negotiate, read this and start to educate yourself on how to do it.  If I can do it – and I used to run from negotiation—anyone can do it.

But how can a writer adequately evaluate a publishing company she has never worked with? How does she know if the company is late making payments or doesn’t put out e-books on time? How does she know if the company makes it extremely difficult, if not impossible, to revert rights on books long out of print?

She can’t, not from personal experience, not until she’s actively involved with the company. So it becomes more and more imperative that writers talk with each other and share information, honest information, about their traditional publishing companies.

A lot of publishing companies have a non-disclosure clause in their publishing contracts. The writer cannot talk about the terms of the deal that she has signed.

But there is so much information that this writer can give another writer that won’t violate that non-disclosure agreement. The writer should be able to answer simple questions like: What are the pros and cons of working with Traditional Publishing Company A? or Are you happy with your experience at Traditional Publishing Company A? or Would you recommend a friend sign a book deal with Traditional Publishing Company A? or Knowing what you know now, would you have signed your deal with Traditional Publishing Company A?

A “no” on any of the last three questions would be a red-flag.

Also, the writer considering an offer from Traditional Publishing Company A should talk to a writer who seems (from the outside) to be happy with the company and one who is not happy with the company. Just because someone had a bad experience doesn’t mean you will. And in fact, the bad experience might not be bad from your perspective. I’ve often learned more from someone’s bad experiences than the good ones—especially if the bad experiences can be mitigated with a contract term or two.

So you educate yourself about the publishing house before you sign the deal. You negotiate the deal on your own or through an intermediary.

And here’s the important thing: In this day and age, never ever ever sign a multi-book contract. The multi-book contract forces you and the publisher to stay together even if the relationship doesn’t work.

Writers have a lot of clout now because we can say no to a bad deal. We no longer have to take or leave what we get offered. We can not only walk away, we can walk somewhere else—and often, somewhere better.

The more of us who stay in traditional publishing and negotiate better contract terms, the more that will help the writers who decide to only publish traditionally.

Whether you want to go indie part time or not, you as a writer must now take a position of power. You need to negotiate from the position of power, not from the position of someone who is grateful for attention. Even if you never indie publish anything, this new world can benefit you—if you let it.

Next week, I will tell you how to evaluate a good traditional publisher and a bad one. I will tell you what to look for, and whether or not those things can be mitigated through a good contract or if a contract won’t help you at all.

Writers need to step into our new-found position of power. We need to stand up for ourselves whether we’re traditionally published or indie published or both. We need to learn the business so that we can make the best deals for us and for our work.

It would help if we work together to do this. Not band together, because we’re all individuals. But we should share information, share tactics, and share experiences—without trying to force someone to be like us.

We have writing communities. It’s time to put them to good use.

I spend a lot of my fiction writing time working on this blog. Today, between the obligatory pie-baking and Thanksgiving prep, I didn’t manage to get any fiction work done at all. This blog took all of my available writing time and honestly, without a donation or two, that means I lose money. So if you’re getting value out of this blog, please leave a tip on the way out.

And, since we in the United States are giving thanks this week, let me thank you all for coming to the blog, contributing through information, e-mails, comments, links, and donations. I greatly appreciate all of it. Thank you!

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“The Business Rusch: Writers and Traditional Publishing Companies” copyright 2011 by Kristine Kathryn Rusch.

 

 

 

 

 

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26 Comments

  1. Happy Thanksgiving, Kids. Hope the next storm doesn’t blow y’all away …

    Steve

    Reply
    • Thanks, Steve. Happy Thanksgiving to y’all too. It’s not this storm that we’re worried about. The previous storm was the tough one…

      Reply
  2. Kris said: “No review copies, late production making it impossible for me to do some of the promotion myself, almost no promotion inside or outside of the genre.”

    Kris, I’m curious what kind of promotion you (or the publisher) would have done on this book. In the past, you’ve said don’t promote beyond having a good cover and blurb, just write. And I had the impression that mid-list books don’t get any promo from the publisher. Did I misunderstand? I’m still trying to sort out the whole promotion/marketing thing myself–lately I’ve been doing nothing but writing. Sometimes, though, I wonder if I could be getting more sales with some kind of marketing effort.

    Reply
    • Tori, reviews are promotion. Not just with the big review places, like Publisher’s Weekly, but also with bloggers, etc. Then there is simply the ability to put a cover on a website, or to let people know when the book will appear. The company catalog is also promotion that goes to bookstores. All of this stuff I can do, if I have the cover or the page proofs. I can also put excerpts up, etc. It takes little time and it lets readers know the book is coming. Ad buys aren’t very effective, except in a few instances, but reviews get readers to the books much quicker than anything else.

      Reply
  3. Great post as always, Kris! From what I’ve heard, in the last year or two traditional publishing contract terms have gotten significantly worse for the writer as traditional houses try to hang on/acquire all the rights they can. My working assumption has been that as more writers walk away from bad deals, industry standard terms would begin to shift back to a position more favorable to the writer, giving the writer a better position from which to negotiate. But based on your recent blogging and Dean’s (i.e. 95% of writers will never indie pub) I’m beginning to wonder if my working assumption is wrong. Do you have a sense how things will shake out Thanks!

    Reply
    • I am hoping that with education, Steve, even the traditionally published writers will walk away from a bad contract, knowing that they have other options. I’ll be dealing with this more indepth next week. It’ll also be up to writers organizations to tell their members not to accept certain terms, and writers themselves to inform their friends that there are other ways. You don’t have to indie publish, but you will have to stand your ground and walk away occasionally. If writers do that much, then the contracts will improve. The problem is that right now, the agents are caving on almost everything, desperate to get a deal. And when that large agency used the royalty debacle with a major publisher to improve terms only for their NYT bestseller and not for any of the midlist writers, I got furious. That’s how agents are behaving these days (in general)–not as writers’ advocates, but as drowning people, clutching whatever they can to save their businesses. I’m hoping writers will wake up and start negotiating on their own, which will improve things for all of us.

      Reply
  4. Wow, a post on thanksgiving! Hope you’re eating turkey right now! So in a case where the publisher doesn’t follow through on things stipulated in the contract, what recourse does the writer have?

    Reply
    • Livia, great question. For things stipulated in a contract, well, sometimes you have recourse and sometimes you don’t. I’ll deal with this a bit next week, but the short version is this: If it has to do with money, you can usually get the publisher to change practices, pony up, fix the mistakes, etc–with the threat of legal action at times, but you can. If they fail on the marketing side, yes, you can call that a breach of contract, and pull the book back but here’s the problem: you’re closing the barn door long after the horses have escaped. Long, long after. And then you would need a protracted legal suit to prove that the publisher didn’t do (or make best efforts to do) what he said. By the time the writer realizes that the publisher will fail on the marketing plan, the book is often in the stores and has been for a while. Look at the Kaplan case. Yes, she can say the contract is breached (if, indeed, it is), but the book is published, and has been published dead. That means no other traditional publisher will touch it. The best she can do is get the rights back and self-publish it, but because Kaplan still exists, they might want to hang onto the book and might fight for it.

      The question I always ask myself is this: Do I want to litigate last year’s problem or write the next book? If you look at my bibliography, you know my answer. I also am the Colonel Tom Parker of the publishing industry: screw me once, and I’ll paste that contract clause on my fridge until I learn the clause. Then I’ll make sure I either never have that clause in a contract again–or I put it in one of my contracts to my benefit. (For those of you who don’t know, Parker was Elvis’s manager, and that was Parker’s business m.o.) I make mistakes. I just hate making them twice.

      Reply
  5. Hi, Kris,

    Thought provoking post, as usual. Hope you and yours have a great Thanksgiving and even more to give thanks for next year than this year.
    Tori, another thing publishers can do to support books is pay the extra so your book gets displayed in the center aisle stands. That will catch the eye of readers that don’t normally go to your section, be it mystery, romance, or SF, and buy the book outside their usual genre.

    Reply
    • Thanks, Mike. You’re right. There are lots of little things that traditional publishers do that writers either don’t see or understand as marketing, when it actually is. And I hope you had a great holiday!

      Reply
  6. You know, I wasn’t even think how the agents might be effecting all this. (Honestly, I think very little about agents since I don’t have one.) BLEH! That will definitely slow down the migration to a better world. Thanks for the reply, Kris!

    Reply
  7. I like the way you phrase things. It’s hard for writers to “band together” when they are so differently situated.

    A brand new writer who has spent the past few years trying unsuccessfully to get an agent,, a NYT bestselling household name, and a mid-list writer who is practiced at the game are so differently situated that it’s hard to see what they have in common.

    I hope the established writers understand what you’re trying to do and use some of their clout to help the upcoming generation. From what you’ve said Simon and Schuster will survive. Let’s hope the best of the upcoming generation of creative writers also survive.

    Reply
    • Exactly, Teri. I hope that writers see this and do start working with each other to share information. I too would like creative writers to not just survive, but thrive in this new world.

      Reply
  8. Thanks for clearing that up, Kris. I get confused easily when it comes to marketing, lol. It’s not something I’m good at.

    Reply
  9. Kris, thank you for being direct and open about the issues you and others face in getting your work published. It offers one a lot to think about and the fact that your points are well laid out will enable anyone to make the decision to go traditional or indie a personal and informed one.

    The insights that you and others, like Michael A Stackpole, provide are going a long way to ensuring that there is transparency in the publishing industry. And just in doing so are proving the need and use of Free Speech.

    Thanks again and have a great holiday.

    Reply
    • You’re welcome, Sven. Thanks!

      Reply
  10. I bought back the third book on a three book contract years ago because the series was dead. Numbers rule.
    I think the entire paradigm of publishing has changed. Even more interestingly, as I see agents and traditional publishers try to switch over, is that there is a two year lag. If you weren’t starting to surf this wave two years ago, you’re way behind. Most new businesses and technologies take at least that long to learn and become proficient at. I’m starting to get approached by those who didn’t toss their surfboards in the water back when it was apparently filled with sharks. I also see many who are still so scared of taking chances, they’re going to be left further behind.

    Reply
    • I completely agree, Bob. The paradigm has shifted. What some of us who understand this have to realize is that a lot of writers will still go traditional first. We have to help them use their power as writers in this new world to get better contracts, to learn to negotiate, and to just plain have a place to jump when things go awry (which they will). I also agree about taking chances. I’m watching so many in this new world flail–from publishers to agents to writers. It’s sad and difficult, especially when I’m so excited about how it is all going.

      Reply
  11. Hope you had a great Thanksgiving, Kris. The entire Kaplan situation is just appalling, especially the lack of recourse-the fact that caught in a situation like this there is so little an author can do.

    Reply
    • JR, there is very little the writer can do, and it can be scary. But we can do one thing: we can write the next book and make better choices the next time.

      Reply
  12. Wow. These last two columns are eye-opening. I really appreciate you using hard numbers and doing the math to make educated comparisons. Thanks, Kris.

    Reply
    • You’re welcome, Melissa. Glad it’s helping.

      Reply
  13. (Oh, and by “things stipulated in the contract”, I was specifically thinking marketing promises and such)

    Reply
  14. Thanks, Kris. Your blog is a calm, clear voice of sanity and is very close to the top of my thankful list.

    Happy Thanksgiving

    Reply
    • You’re welcome, Rebecca. I hope you had a great holiday. :-)

      Reply
  15. Kris, thanks for these posts. I’ve been debating the indie vs traditional option on the next book and you’ve given me a lot to think about. For many reasons, including the time investment required for sales, negotiation, and ultimately publishing, I’ll probably go indie again. But the book after that? Maybe not. I’d love to hear your thoughts on small press vs the big NY names when you have the chance. Thanks again!

    Reply

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