The Business Rusch: Deal Breakers 2012

I have a sticky note on my computer marked “Deal Breakers—by July 30.” It’s a reminder to revise the deal breakers article I wrote last year for the binder that Novelists Inc. give out at their conference every year.

I was scheduled to speak last year, but had to cancel because of problems with the estate we dealt with all fall.  As a result, my article showed up at the convention, but I didn’t.

This year, the kind folks at NINC asked me if I wanted to revise the piece for inclusion in the 2012 binder. I glanced at what I wrote and thought it would be easy to update.

Hah! So much has changed in the past year—in the world of publishing as well as in my own thinking—that a simple update isn’t possible. I also realized that I was long overdue in updating my thoughts on  publishing contracts. So even if you’ve seen some of this from me before, please follow this post and the next, because there will be new material here.

I know many of you only plan to publish indie from now on and believe that contracts don’t apply to you. But when you click yes to the Terms and Conditions on Amazon’s KDP site or on Pubit or on the new Kobo do-it-yourself publishing site, then you’re effectively agreeing to a contract. You should really understand it and how it applies to you. (Most of the angry complaints you see on the Kindle boards about Amazon are from people who’ve never read the Terms and Conditions that they gladly clicked when they put up their books.)

I also get questions from five to six writers per week whose indie books have attracted the attention of foreign publishers or Hollywood or audio markets or theaters.

All of those subsidiary rights (and yes, a foreign book is a subsidiary right) require some contract knowledge and a bit of balls in negotiation. If you haven’t read my pieces on negotiation, please read them now.  If you want to read them all in one place, you can find them in my Freelancer’s Guide short book titled How To Negotiate Anything, as well as in the big gigantic Freelancer’s Survival Guide itself.  You can buy both books in print or e-book form, or you can find the same material in slightly different form here on the website.

In other words, what I have to say about contracts applies to both indie and traditionally published writers. So don’t dismiss the topic just because you believe it does not apply to you. It might in the future. It might have in the past.

Second, let me remind you that an agent no longer has the skills to negotiate a book contract. Things have changed too much. If you feel you need an agent (and that’s a whole other blog post), then add an intellectual property attorney to your business team as well. Let the attorney handle the contract side—with your supervision of course. (If you want to see a list of intellectual property attorneys, see this post by Laura Resnick.)

Publishers have a team of attorneys designing their contracts. Most writers never seek the advice of an attorney on contractual matters, preferring to trust a glorified salesperson/manager (the agent) to handle such things—even though an agent should not dispense legal advice. That’s practicing law without a license, which is illegal in most states. Also, contracts have gotten so complicated that most agents do not understand them at all. I’ve seen contracts renegotiated by agents to be more favorable to the publisher, not less. Why? Because the agent used to be an editor (in other words, she used to work for the publisher), and thought those details had to be in any contract.

If you don’t want such things to happen to you, hire an attorney.

Please remember that attorneys specialize and any old attorney will not do in this situation. Find one who specializes in copyright law. This rule applies whether you are an American author or a European one or any flavor of author in between.

I start every contracts post talking about negotiation because most writers—professional or not—do not realize that contracts are negotiable. In fact, a contract is not set in stone until both parties sign it. An agent or an attorney, for that matter, is not party to a publishing contract. The writer and the publisher are. So it really doesn’t matter what advice your attorney gives you. If you follow it, and sign the contract, then you are responsible for your end of the contract.

If you sign a bad contract, it’s no one’s fault but your own. So learn this stuff. If that scares you, get the negotiation book and combine it with The Copyright Handbook,  so that you understand exactly what you’re doing when you license something. (If you don’t understand this stuff, you will find yourself in trouble down the road.)

The other reason I start with negotiation when I get to contracts is because you have to know at what point you will walk away from a book deal. Yes,  many long-term professionals have walked away from a book contract at one point or another in their career. Sometimes these professionals walk during the negotiation. Sometimes they realize a contract is untenable and pay money to get out of a contract. I very nearly did that in October when a representative of one of my many traditional publishers did something so egregious, I felt I could no longer trust my work to that publisher. Only negotiation and a lot of work on the part of the publishing house kept me in the fold.

Professional writers know what their deal breakers are.  In the past, most writers rarely talked about this. Now it’s becoming part of the conversation, mostly because professionals are walking away from contracts more and more.

Last week, the gifted mystery and science fiction writer, Kate Wilhelm, blogged about her deal breakers. She announced the creation of her new publishing company, done in collaboration with her family. What makes this news is several fold.

First, Kate has been a ground-breaker for her entire career. She published her first short story in 1956. She co-founded The Science Fiction Writers of America, the Milford Writing Workshop, and the Clarion Writers Workshop. She and her late husband, Damon Knight, published a lot of valuable guides for writers, and did all kinds of things that were then revolutionary, but are now considered normal.

One thing that Damon did was write a model contract for writers, things that writers should have. Kate and I used to live in the same town, and one of my many memories of her involved her sitting on a corner of her couch, a legal notepad in front of her, making a list of the things that a movie had in common with one of her books, in preparation for a lawsuit that she eventually won.

Kate believes in author’s rights, and in standing up for yourself in publishing. She’s done it for 56 years. I can only aspire to this.

And now, at the age of 84, she’s starting a new venture. Please read her entire post.

As she writes about the impetus for the new venture, however, she talks about deal breakers. She encountered some recently and dealt with them in the only way possible. She writes:  “In the fall of 2011 I was offered a contract that was so egregious that the publishing house that sent it should have been ashamed, and if I had signed it I would have been shamed.”

Please notice her wording there. She puts the onus on both the publisher and the writer, the publisher for even proposing such a contract, and any writer who even thinks of acquiescing to such terms.

She responded to that contract professionally. She writes, “I proposed additional changes to those my agent had already managed to have incorporated and each suggested change was refused. I rejected the contract and withdrew the novel.”

In other words, she declined the deal. The publisher’s terms were a deal breaker for Kate.

In the past, there wasn’t a lot of recourse for a writer who left a publisher over contract terms. The writer could try to sell the book to another publishing house and hope that the terms were better there. Or she could shelve the book until later.

I had a couple of deal breaker contracts in those years, and always managed to sell the book for more money. That became harder and harder in this new century, plus a new wrinkle got added in.

Agents started complaining: We had a deal. I spent time negotiating it. We should accept it. (In other words, the agent wanted payment for his work, even when he wasn’t acting in the author’s best interest.) Because many writers see their relationships with their agents as “a marriage,” the writers would acquiesce, apparently thinking that the agent was an equal partner in the career.

The agent is not an equal partner. He gets hired to do a job, nothing more. And if he fails at the job, he doesn’t get paid because he works on commission. Which means he gets paid only if the client gets paid.

Old-time agents understand this. The big agencies and newer agents (in the agenting biz for 10 years or less) don’t.

I want you to notice something else in Kate’s post. She read her contract, even after her agent went through it, and had even more changes to make. She tried to negotiate, and failed. (Yes, I know, she didn’t hire an attorney, but she has used attorneys in the past. Apparently, after 56 years in the business, she didn’t feel like she needed one in this case—and she probably didn’t.)

Here’s another part of Kate’s post. It’s subtle but it’s important. She’s been in this business longer than the people she was negotiating with. She’s written more books—successful books—than most writers ever will.

Yet she got treated poorly here. This publishing company—and it’s a major company—did not treat her with respect.

I’m sorry. That’s criminal. But that’s what has been happening to long-time professional writers for more than ten  years now. I just corresponded with one today who actually left the business because she’s been so poorly treated in this new decade of the twenty-first century.

But I digress.

I have no idea how Kate initially reacted to all of this.  I suspect she was both angry and disappointed. I know I’ve had those feelings in the past when I’ve been treated badly by publishers.

Then Kate did what Kate always does. She looked at her options.

She writes, “At that point, I could have tried a different publisher but I knew it would have been a repeat performance, because the major publishers are tightening ranks and the contract I had rejected was more or less the new standard.”

Again, Kate has remained aware of all of the trends in publishing. She knows what has been happening to contracts all over the business, and that her treatment by her publisher is not unique (sadly).

She writes, “It wasn’t about the advance, I might add. It was about rights, especially electronic rights, not only those in existence today, but anything that might be developed in the future in any form: who owned them, duration of ownership, how they would be exploited, how and if they would ever revert, and so on.”

Kate wanted to retain as much ownership of her work as possible. Since publishing houses and all of those jobs—from editor to sales manager to publisher—would not exist without us, the writer, the content provider, you’d think we would get more respect.

But that’s going to come in the future, when traditional publishing starts to understand that we’re no longer going to put up with bad service, bad contracts, and bad attitudes.

Kate Wilhelm, at an age when many business people have been retired for twenty years, is so on top of her game that she not only walked away from a contract, she’s now using this opportunity to start a whole new business.

She formed a company with her sons and daughter-in-law, to publish Kate’s new and backlist titles. Then when that “Herculean task” (her words) is complete, Infinity Box will publish her late husband Damon Knight’s work. And the plans don’t stop there.

She adds, “After our initial offerings are complete, we will open the doors to other writers.”

You can bet that this publishing company will offer fair contract terms and good treatment to writers. After all, Kate has devoted her career to it.

Smart writers are making choices like Kate’s all the time. Gregory Benford now works with Lucky Bat Books to get his backlist out.  I’m not sure if he’s doing his front list or not. Joe Konrath flirted with Amazon’s publishing house, and has now returned to the indie fold, after realizing that his own publishing company has greater reach to readers than the mighty giant Amazon does. (Joe learned the downside to exclusivity—angry fans who don’t want to buy on just one platform.)

Even though I follow trends in the industry, I learned about Kate’s break-out move from another longtime professional, Lawrence Block. He’s been indie-publishing for a couple of years now. He’s doing all kinds of fascinating things, from publishing old stories to collections to a never-ending e-book series of afterwards about his existing novels (of which there are many). He keeps adding to the afterwards book, so I refresh my edition from time to time.

His newsletters are always interesting. The one with the notice about Kate’s new venture put me in mind of a lesson I learned from Mike Resnick about fifteen years ago now.

Mike told me and Dean that it wasn’t our job to worry about the future of some start-up company. We should always “run to the money.” And then when the money gets tight, we should leave that company.

Not surprisingly, Mike is an early e-book adapter too, and has indie published a large number of backlist books. He ran to the money.

Professionals of long-standing, and by long-standing, I mean decades, writers that include Kate Wilhelm, Lawrence Block, and Mike Resnick, are turning to independent publishing because that’s where the money is now. Writers make more money starting their own publishing companies and publishing their backlists (and  yes, folks who whine about the terms, that is indie publishing in all senses of the word) than they ever will through traditional publishers.

Particularly with the current contracts being offered to writers—with the egregious parts of the contract being non-negotiable.

Before you give up on your favorite traditional publisher, however, do a cost-benefit analysis. (See if you’re getting adequate payment for the amount of money you will lose by going with the publisher.) Benefits might not be monetary.

But do not count promises as a benefit. Only count results. So if your publisher promises you bestseller status, and you don’t get it, then that is not a benefit. That’s just a promise, and an empty one at that.

The key to doing business with someone other than yourself—be that someone a traditional publisher, an independent press run by another writer, a foreign publisher, a Hollywood studio, or Amazon.com—is to both understand and negotiate the contract you’re presented. Unless the terms you get are in writing in that contract, the promises you hear, the terms you’re told about, do not count as part of the deal.

Got that?

The best way to measure your value to the publishing house is to negotiate for the best contract terms you can get. What the house is willing to bend on will tell you how much monetary value they believe your work has to them. (It will have a different value to you.)

I recently negotiated one of my traditional contracts with a house I’m quite pleased with. I ended up walking away, but to that house’s credit, they told me this: one of the terms I considered a deal breaker was not available to me because I am not a New York Times  bestseller. Had I been one, they would have budged. It wasn’t worth their while to give up that particular part of the contract with a midlist author like me.

I understand that. It wasn’t worth my while to stay with them in that case. But we parted on friendly terms and I wouldn’t hesitate to approach them again with the right project, if we can come to a mutually satisfactory agreement.

Next week and possibly the week after, I will write about the changes in my thinking about traditional publishing contracts from last year to this year. But for the rest of this post, I’m going to include the points from last year’s article that I believe still hold up in 2012.

Remember as you go through this short list that I am not a lawyer nor do I play one on TV. What you see below are my opinions only. Yours might differ.

I’m listing three points that you should consider when negotiating a contract with a traditional publisher:

1. The Rights You Plan To License.

The first thing every publishing contract states are the rights you will license to the publisher.  In the past, I used to recommend that a writer only license North American Rights—that is, you license the publisher the right to sell the book in North America (in other words, the United States and Canada).  Now, I recommend that you license World English Rights.  Why the change, seemingly in the publisher’s favor?

Here’s why: Most writers stay in traditional publishing so that the publisher will do the work.  It’s hard to hold national boundary lines on e-books.  In fact, in this modern world, it makes your fans angry.  So rather than sell a North American edition only, let your publisher put the book up on Amazon Kindle and in all countries in the iBookstore.  Gain English language readers all over the world.

But—and this is important—do not license World Rights.  Keep the rights to your work in translation.  Your publisher doesn’t need to sell the translation rights for you.  In this modern world, you can do that yourself.  If your book is published in English worldwide, then other publishers will easily see it, and will want to translate it into their native language.  Let them pay you for that, not your publisher.

In fact, hang onto as many rights as you can.  Do not license movie rights or audio rights.  I’d tell you not to license e-rights, but while that was possible in 2010, it’s not possible any longer unless you are a very big name.  Too many booksellers are going digital these days. (I’m looking at you, Barnes & Noble.)  No publisher is going to give up that market.

So in exchange for those e-rights, make sure you keep all the other rights in the work.  License only book rights. Not enhanced e-rights, not application rights, not smart phone rights.  Enhanced e-rights in particular are a place where publishers make outrageous rights grabs.  Make sure you only license the rights to the text itself, not to text with pictures, text with audio.  If you see something in the rights language that you do not understand, do not agree to the terms or sign the contract until you understand exactly what that language means.

Last year, I had publishers here and in  England (England especially) tell me that they don’t need the rights they’re buying. They’re just adding those rights for “insurance” and they will “gift” those rights back to me if I but ask them.

Look at the logic here. If they don’t need the rights, then they shouldn’t ask for them in the first place.  This happens in particular with enhanced e-rights and new technology rights. That’s where the biggest rights grabs are at the moment.

2. The Amount You Will Get Paid For That License.

This one’s a tricky proposition.  Because advances are going down significantly, while the demand for rights has gone up.  Most established writers can make more money with self-publishing over the next two years than they can through their publisher.

The difference is that the publisher pays up front, and self-publishing does not.

There are a variety of ways to look at payment. The best way to examine what you’re getting for the rights you license is the value you’ll receive.

Note that I didn’t say the money you will receive.  Unless you’re a Times bestseller, you’re probably not going to be paid up front what you are worth, certainly not in these times.

So you need to examine the value of what the publisher offers. Here’s how:

1. Do you need the up front money to continue with your writing career? Can you live on that advance? If so, try to get the publisher to pay you on signing and acceptance of the finished manuscript.  Limit your rewrites in your contract to no more than two.

2. Can your publisher get your book into markets that you cannot get your work into? (Make sure you know what’s possible as well. See Dean Wesley Smith’s Think Like A Publisher for that.) Are those markets worth going into? Two years ago, publishers could easily get your books into brick-and-mortar stores. Now, lots of brick-and-mortar stores are gone or cutting back on their titles. Is it worth losing a large chunk of your income for the opportunity to get into reduced brick-and-mortar market?

3. Does your publisher do quality e-books? I can name several traditional publishers who do not do high quality e-books, trying to drive readers to hardcovers instead.  If your publisher does a crappy e-book product and the market is moving to e-book, realize that your readers will blame you for the bad product, not your publisher.

4. Does your publisher do a timely e-book? Last year, one of my traditional publishers delayed the e-book of my latest release to the consternation of me and my fans. I lost hundreds of sales weekly because the publisher believed that the delay would increase sales of the trade paper.

All it did was make readers angry at me. Even now, that particular publisher does not put my books in all e-book markets. So I constantly get letters from fans about inaccessibility of my books.

When my contract came up for renewal last year, I asked the publisher what he needed to satisfy the option. I also told him that unless he offered me a significant advance and a change in e-book policy, I would not license my book to his company.  We parted ways quickly after that, and I can’t be happier.

Why do I insist on an e-book that’s published simultaneously with the hardcover? Because, in this madcap busy world, readers who want the book now will forget that the book exists when the e-edition finally appears six months from now. Each day a traditional publisher delays causes significant lost revenues—and subjects the writer to confused and angry e-mails.

5. Will your publisher promote your book? I don’t necessarily mean whether or not your publisher will have an ad budget for your book. But is your publisher sending out galleys? Contacting the sales forces of local bookstores? Making sure the book bloggers know about the title? If your publisher isn’t doing any of those things, then you’re not getting value for your dollar.

Here’s how I look at a book advance.  If the publisher wants a lot of rights, the publisher must pay for them.  With advances declining, it’s less and less likely that a midlist writer can receive a good advance in exchange for the rights she’s licensing.

Yet I continue to sell into traditional publishing. Why?

Because I’m using traditional publishing to advertise my indie-published titles under the same name. When Wickedly Charming, my Kristine Grayson novel, appeared from Sourcebooks, the sales of all of my indie-published Kristine Grayson novels jumped dramatically.  They hit a higher plateau and have stayed on that plateau.

Sourcebooks is promoting Kristine Grayson in venues that I have yet to reach. Instead of me spending advertising dollars to get the word out on my book, I’m getting paid to advertise.

In the advertising business, they call what I’m doing a loss leader.  I am losing some upfront money to bring someone to my product. Is it worthwhile? It was on the first Grayson book. Since I wrote this piece last year, I’ve published two more Grayson books with Sourcebooks. The increase in sales has not been as dramatic.

I suspect that the loss leader theory only works for a few books, rather than an entire series of them.

Which brings us to:

3. The Number of Books You License in This Contract.

In the past, every writer wanted a multibook contract.  It gave us security, and it made sure that the publishing house put an effort into publishing our work. The publishing house had a lot of money and future profits at stake, so the house worked harder on multibook contracts.

Now, with things changing as rapidly as they are, multibook contracts no longer provide security. They might harm us by locking us into contract terms that won’t be good for us in 2013 or 2014.

Right now, go with a one-book contract. It gives you flexibility to negotiate better terms for you in the future, terms we may not even be able to envision now. (Did you know what an app was in 2008? If you signed a multibook contract that year, you are probably still fulfilling that contract.  And it’s out of date.)

And that’s all, folks, at least for the moment. Three deal breaker points that have remained the same out of five for last year. I suspect I’ll have at least three more in the next few posts, plus some more in-depth explanations.

Last August, when I wrote the initial piece, is decades ago in the changes that have occurred in publishing. Some of what I wrote no longer applies given what has been happening in publishing these last three months.

I’ll address those points in the remaining articles in this series.

Speaking of series, my post on Perfection led to a mini-series for me. I hadn’t expected to do that, but your comments, on the post itself and in the e-mail, led to the longer posts. Thank you!

And thanks to everyone who donated. As I’ve said before, I make my living writing fiction, so this nonfiction blog has to remain self-supporting. If you’ve learned anything, if you like what you’re reading, please leave a tip on the way out.

Much appreciated.

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“The Business Rusch: Deal breakers 2012,” copyright © 2012 by Kristine Kathryn Rusch.

 

 

 

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43 Comments

  1. Very informative post. Thanks!

    Reply
  2. I used to be an attorney. I do not practice any longer.

    In international contracts, I will insist on choice of law and choice of venue provisions. Even though most countries are signatories to the Berne Convention, the courts in other countries interpret the provisions differently. It is the court’s interpretation that governs, not the words of the convention. I want a court that uses the interpretation I am familiar with. I also want a court that moves the case forward and decides quickly. My preference is for American federal copyright law with venue in the Eastern District of Virginia.

    I have refused a contract with an artist in India because she insisted on Indian law and Indian courts. Indian courts are glacially slow. Remember the Bhopal gas tragedy (December 1984)? The lawsuits from that are still in appeals. That means none of the victims have seen a dime from their judgments.

    Reply
  3. Another great piece of advice, thank you so much. Why do I have the feeling all this negociating stuff is like dealing with a snake ?

    As an indie, I recently signed with Google Play. I was very surprised not to find a description field for my ebooks whith Google.

    And now, Google Play has just launched in France. And when you look on the virtual shelves, searching by genres, my ebooks are not there.

    You have to type my name to find me. And I’m not the only indie writer in this case. I have looked at my Google’s contract, and it didn’t say indie’s novels would not be indexed.

    On the contrary, there are legacy books, but in very short supply : less than forty (40) for the sub-category “epic” fantasy. Such a number is a shame for a company like Google.

    What I believe is that Google, who had an agreement with a number of trad publisher in France (like La Martinière), has favored these publishers, or at least has prioritized them.

    And I do not mention the tax problem with them (their European siege is in Ireland, with 23% of tax for ebooks).

    So, have you had the same problem in the US with Google ? Are there as many ebooks on the virtual shelves like on the ones of Kobo or Amazon ? Did the indie publishers felt betrayed like I do ?

    Reply
    • I haven’t gone directly to Google, Alan, although I have heard a lot of complaints about them. Hmmm. I will ask on one of my lists. Thanks!

      Reply
    • Another complaint I’ve heard about Google that keeps me away is their discounting policy. They will discount your ebook on their own whims, and then Amazon will price match it. Authors have gotten burned when their best seller has its cover price cut in half (or to zero) and their biggest market (Amazon) follows suit.

      Reply
  4. In the UK, if you join the Society of Authors, they have lawyers who will look over the contract for you, and tell you of any red flags. They won’t negotiate the contract for you, but their advice is invaluable.

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    • The Authors Guild in the US does that too, but as long as Turow is president, I’m not recommending that anyone join. Maybe in the future. You UK writers, you might check this out. Thanks, Lynne!

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    • The Writer’s Guild UK (mainly scriptwriters, but novelists are eligible) also have a similar service for Candidate and Full Members.

      Reply
  5. Kristine,

    This was a solid education in traditional publishing contracts and some things to look out for. Thank you.

    I’ve purchased both the Kindle version and the print version of the Freelancer’s Survival Guide because of the Business Rusch. Great reads, highly recommended.

    Reply
  6. You’ve given me lots to think about. I plan on self publishing my romance line but my YA was something I thought I would send out. It’s a fantasy so there are two houses that I thought I would try-Tor and DAW. The only thing is neither one of them does eletronic submissions so I have to send it by mail with SASE for a response. That means I need one of those reply coupons for them to use to put a stamp on so they can reject me. Those coupons are very expensive here. I’m from Canada so this is out of pocket expense. It would be a gamble.
    If I got my romance line up and going I could always introduce the YA to them since a lot of women read YA.
    I think a laywer is most important now because of all these clauses that you mention. It’s just too mind boggling!

    Reply
    • And getting more mind-boggling, Vera. Check out Carradee’s post below. I do think we all make our own choices though, and take our own risks. We just have to know what we’re getting into, imho.

      Reply
    • You might want to also consider Baen who prefer electronic submission via a webform with your email adress in the RTF, no SASE required. All the details are on their website under the About Baen menu, FAQ page item.

      Reply
    • As a fellow Canadian, there are three easy alternatives to IRCs, which are indeed expensive: First, while a house may not accept electronic submissions, they often are willing to reply electronically, which obviates the need to pay for return postage, and saves that money. Second, if you do need a paper response, American stamps can be purchased for considerably less than IRCs in any Canadian (or for that matter any) city with a stamp store (for collectors), or from the USPS by mail. Check out their website and you can choose what your return mail will look like. Third, and probably easiest, send a few bucks to an American friend of family member and have them send you some stamps back. Make sure that you get the right denominations whether you go for solution two or three, and you will set yourself up for responses as required.

      Reply
      • When Konrath was still trade publishing, didn’t he write a blog post along the lines of ‘I don’t send SASEs to publishers because it makes you look like a loser’?

        So you could adopt that approach; if they want the book, they’ll pay for a stamp or send an email.

        Reply
  7. Another great post. As someone who beginning to take a serious look at the current publishing market, you’ve given me more in this blog posts then I would have learned in five years of slaving away at the keyboard, then wondering why I’m not making any money.

    But I still don’t know how they can use accounting tricks that in any other business outside of Hollywood or Washington DC would result in the law swooping in and arresting everyone. Publishers got away with a lot of crap in the past, and they haven’t learned that the author isn’t a wage slave anymore, but an independent contractor with more power than before.

    Again, great post!

    Craig

    Reply
    • I suspect those accounting tricks will change, Craig, as the industry changes. But then, I’m an optimist. :-)

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  8. Thank you! That was thought provoking and timely. There are so many changes and so many rapid changes in publishing at the moment it’s good to be reminded and made aware of all the different possibilities.

    Going to check out Kate’s post straight away!

    Reply
  9. Some contract terms are appalling, like ones that effectively give the publisher the right to use the story in any format existing or to be invented for the duration of the copyright. I don’t care if the contract’s “non-exclusive”—the nature of it means that the author can no longer guarantee “first rights” in any format to anyone. (And to offer a flat fee for all that? Bye.)

    And I agree with the “Oh, we’re not going to use that” line. I’ve heard (and walked) from a few contracts this year alone that refused to take out of the contract the things that they claimed weren’t going to be used. And then there are the contracts I’ve walked from in the past 7 years, and the ones I should’ve walked from and didn’t… (Fortunately not for anything that truly matters to me.)

    Then there are the publishers who pat you on the head and insist that the contract isn’t actually saying something it explicitly says. To that I wonder: Do you even read your own contract, or do you really think me that gullible?

    Sure, I’m no lawyer, so I’m not qualified to give legal advice or anything like that. But I’m good at logic and at parsing things for what they actually mean, both best-case and worst-case scenarios. I also read contracts and Terms of Service on purpose. (As long as it remains a logic exercise, I find it fun—but then when I encounter one of the O.O ones and realize that people actually sign it… That gets depressing.) So I’m not entirely incapable of making judgement calls on my own contracts. ^_^

    Anyway, thanks for addressing these issues, Kris! I refer all my writer friends (and others…) your way.

    Reply
    • It’s getting worse, Carradee. When someone like Kate can’t get her contracts changed, it makes me wonder what’s happening to the bestsellers as well. Ugly stuff at the moment. Thanks for the post!

      Reply
  10. Thanks Kris–this is great! I’m getting close to actually (Indie) publishing my first novel, so this is exactly the kind of stuff that I not only love reading, but need to read right now.

    One thing that I’ll add–I’m also an attorney, but specialized in fields outside of copyright (environmental and antitrust). In addition to my own review, I fully plan on getting a proper copyright attorney to look at any deals that may come my way, be they legacy publisher, Hollywood, translation, whatever. A couple hundred bucks is a small price to pay when you consider that the deal could be worth much more down the road. Who knows? Anyone’s indie novel could become the next great French sensation, or Hollywood hit! By retaining as many rights as possible, you never foreclose a potential avenue to success, however odd it may seem initially.

    Thanks again for all of the hard work and sage advice you and Dean put into these posts; I would be utterly lost without them!

    Reply
    • Thank you, and thanks for confirming that lawyers specialize. So many people do not understand this. Law is a complicated biz, and no one can know all parts of it. Thanks for the post, DJ and good luck with the book!

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  11. Kris wrote: “Also, contracts have gotten so complicated that most agents do not understand them at all.”

    Yep. I increasingly hear from writers who have a business problem, and when we discuss it, it emerges that their agent (whether current or since fired) was/is UNABLE to explain and/or clearly does NOT UNDERSTAND (and/or can’t be bothered to find out) what the contractual clauses mean which (yep) the agent accepted a professional commission to “negotiate” and advised the writer to sign. And so the writer is left alone with the problem, and is asking others writers if they’ve dealt with a similar problem and/or asking me if I think they need a lawyer or if I can refer them to one so they can, among other things, find out what the HELL the agent =actually= advised them to sign which is now screwing up their careers and/or income.

    Kris wrote: “I’ve seen contracts renegotiated by agents to be more favorable to the publisher, not less. Why? Because the agent used to be an editor (in other words, she used to work for the publisher), and thought those details had to be in any contract.”

    Indeed. I so dearly wish writers would stop spreading the notion that someone knows how to negotiate a binding legal agreement on their behalf simply because she once got laid off by a publishing company.

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  12. Kris wrote: ” Agents started complaining: We had a deal. I spent time negotiating it. We should accept it. (In other words, the agent wanted payment for his work, even when he wasn’t acting in the author’s best interest.)”

    Yep. I remember an agent telling me that a verbal agreement he’d made over the advance level meant the deal was not “legally binding. Er… REALLY? I hadn’t SIGNED anything, hadn’t even SEEN a contract, and had yet to discuss a single of the 25-or-so legal clauses that could be IN the contract. But the agent was claiming I was now in a “legally binding” deal???

    The agent had made the sale and wanted to be paid, so he was talking bullshit to keep ne on board and in line. This happens a lot. I wasn’t planning on pulling out of that deal, but when you DO decide to pull out, or if you contemplate it because the terms are bad and the publisher won’t negotiate—it’s not uncommon for the agent “representing” you to go ballistic, because if you walk due to bad terms, they won’t get the commission on that deal.

    Yes, there are ethical agents who will say, “You’re doing the right thing. Let’s go.” But it’s a situation which relies on the agent being a principled and ethical individual who can make the right judgment call when his own self-interest is in a patently conflicted situation. I think it just makes much better business sense NOT to have the self-interest in your way during negotiations. to ENSURE that your advisor is acting ONLY on the basis of your own interest and his/her expertise, rather than influenced (really, potentially, or theoretically) by having pressing bills for which he needs/wants that commission check for this deal pronto.

    I DID contemplate the possibility of walking away from a deal which my literary lawyer was negotiating, since there were disagreements during negotiations of some specific (and important) fiscal terms. I felt confident that my attorney’s advice was not at all influenced by self-interest there, after weeks of negotiation had already occurred, since she would be paid the exact same sum for the work she’d invested (i.e. the hourly-fee bill which she’d send me) regardless of whether or not I signed the contract in the end. (Fortunately, since she was well trained in negotiations, she kept calmly persisting in negotiations until we found a solution, though her advice about the ramifications of what NOT finding a solution would mean for me ensured that I probably would have declined to sign if we had not indeed found that solution in the end.)

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    • Er, I mean “now legally binding,” not “not legally binding.”

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  13. Anthology contracts – and shared-world anthologies too – are sharing the rot. The last one I was invited to included a contract that paid no more than the “old” style, but claimed ownership of everything forever for the creator of the shared world.

    For $0.06 a word, losing the ability to use the story in reprints or file off serial numbers and build on it is pretty steep.

    Reply
    • I currently write in a gaming universe, and I know up front, its “Work for Hire”. I get paid $.04 a word, rounded to the nearest hundred, and I have no rights to the stories or the characters. But I accept that, because it isn’t my universe, it’s the game’s universe, the background is very detailed.

      But I am learning things that I’m finding useful. Writing to a deadline, editing, getting a story to flow right, discovering what I need to do to build my own universe. I’m sharpering my writing and getting paid for it!

      Down the road, then yes, contracts are going to be negotiated out for my own stories. Right now, I’m sharpening my skills and building a reputation.

      Craig

      Reply
  14. I hired an entertainment lawyer to close my deal for two book options. I’m glad I did. The contracts were over twenty-seven pages long and some phrases I thought meant one thing actually meant another. It took a few months to close the deal, and for a week or two I was on pins and needles during the negotiation process.
    Right now a screenplay writer has been hired and the project is in the development phase.
    I’m still not sure what to do about all the rights I do hold. I’m one of those “wimps” that would love to have an agent guide me.

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  15. Thanks for such an informative blog post, Kristine. Happily, I do think things are swinging in authors’ favour.

    I’ve just attended the RNA conference in the UK, and what I found fascinating was the change in publishers’ attitudes.

    At the same conference two years ago the various publishers present were all “this is what you need to do for us if you want to catch our attention” (i.e. don’t call us, we’ll call you).

    This year, all three publisher talks I attended revolved around “this is what we can offer you” and ended with the words “thank you, we appreciate that you have a choice”.

    Wow!

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    • Wow, Romy, that is different. Maybe things will change faster than I had thought. Thanks for this.

      Reply
      • “This year, all three publisher talks I attended revolved around “this is what we can offer you” and ended with the words “thank you, we appreciate that you have a choice”.”

        Wow! That’s an unexpected sea change–and a very positive one!

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  16. http://www.harlequinlawsuit.com/ This is what happens when you don’t read and understand the contract terms or when the changes in publishing catches up. I was told a former president of RWA, Gayle Wilson, is party to this action.

    Excellent post, Kris, thanks.

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    • Thanks, Russ. Gayle Wilson is a party to the action. I’m going to spend some time looking at it. It has to do with the future posts on this topic.

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    • I don’t agree with you there, Russ. (By way of disclosure, although I got all my rights reverted from Hq years ago and am therefore not subject to these practices or involved in this lawsuit, I know many of the parties involved and have been closely following negotiations on this matter since last year (Hq’s PR claim of being “surprised” by this filing is nonsense, given how many months the lawyers for the “class” have been trying, with success, to get HQ to negotiate) since I believe it’s an extremely important case.

      The -contract- terms said the writers would get 50% royalties, which is what they understood, signed for, and expected.

      The lawsuit being filed includes a charge of breach of contract over this matter.

      The writers didn’t sign a bad contract with regard to e-royalty rates (in fact, 50% of net is a BETTER rate than the major houses offer in recent years), nor a contract whose royalty rates they didn’t understand.

      They signed a contract which, they now alleges, Hq’s creative accounting practices have breached and violated.

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      • um, I meant “trying withOUT success” (I really need to proofread my posts…)

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  17. Most helpful. I had my big deal breaking fight with traditional publishers a long time ago–and now have my first novel in 20 years novels on its way to market from a good indie publisher who will do print and digital and may revive the best of my back list, too.

    This happened organically, through friends, not agents. The only piece of the puzzle I’m missing is how to sell sub rights. Back in the day, film options and foreign rights always sustained me through the NEXT novel. What’s the best way to handle these in the new publishing landscape?

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    • To answer your question, Joyce, I’ve written about this a lot, particularly in this post: http://kriswrites.com/2011/05/11/the-business-rusch-writing-like-its-1999/

      You can make the deals yourself with an IP attorney. The foreign publishers & Hollywood & everyone else will come to you through your e-mail or your website. (Make sure you have a contact button there.) They will ask who your agent is. Tell them you handle things yourself. If things get to a contract phase, then hire an IP attorney.

      Your agent gets the inquiries the same way.Very few agents solicit foreign publishers. The publishers query them after they’ve heard about your book. Plus there are all kinds of other shenanigans that happen–such as an agent changing the contract in their favor (happens a lot) or turning down deals not worth their while (meaning their commission would be small), but are worth yours. And you’ll never know about the deals. I could go on, and probably should in an update post.

      Thanks for the comment–and congrats on getting the books out again.

      Reply
      • In fact, I was talking just recently with a writer who did the math and realized that foreign subrights sales/income has been better in this writer’s career, over the years, during periods WITHOUT an agent than WITH. Which was one of the factors in this writer deciding to quit the agent-author business model for good after recently firing another agent.

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        • My sub rights sales are all better without the agent, and I’m finally getting royalties on most overseas projects. Hmmm. Makes you wonder about past royalties, doesn’t it? When you have two layers of agents to go through, one set of which you don’t know and you didn’t hire, then there’s even more chance of dicey and hard-to-trace accounting practices.

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