The Word Cloud

11 Comments

• 

  by Pride.James 2 years ago

  Good luck to you Harry, or should that be Your Highness.
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  by Aonghus Fallon 2 years ago

  This is a fascinating article, Harry. I had no idea royalty entitlements rarely out-earn advances - or that publishers still managed to make a profit nonetheless. It does raise a number of interesting questions. Either it was inevitable advances be reduced - or current royalty entitlements (given the publisher is still cutting a profit) are too small. No prizes for guessing how the publishers see it!
  
  And why is Tristram Hunt so hostile to historical fiction?
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  by mike 2 years ago

  Who was responsible for abolishing was it 'resale price maintenance? What will happen when all the bookshops shut? Will 'Amazon' will raise it's book prices? But 'Amazon' don't discount history books anyway. I now borrow history books from the library because they have become so expensive.
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  by Harry 2 years ago

  Relatively few authors earn out their royalties. I never have done once, for example. But that's a sign that my agent has secured me a proper advance in the first place. Publishers can make £££ even if their authors don't earn out. Tho it's also true that publishers lose money or break even on 7 or 8 books out of 10. Strange world, strange world.
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  by Aonghus Fallon 2 years ago

  Your agent may have secured you a proper advance (and I appreciate that a good advance is a gesture of committment on the part of the publisher) but to what degree does it act as a disincentive re future contracts? Or is that an issue, given that the publisher may still make a profit?
  
  I was told that in the film industry only 1 film out of 10 turns a profit.
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  by Aonghus Fallon 2 years ago

  Am I right in guessing that a publisher will justify giving an author a relatively low percentage of the profits (i.e. his royalties) on the basis that he's helping to subsidise his fellow authors?
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  by EmmaD 2 years ago

  Aonghus, royalty rates are pretty much standard, so there isn't cross-subsidising going on between authors: we all get the same sort of cut, and our different earnings are the result of different sales, or, since as Harry says we earn by our advances, different expectations of sales. Cross-subsiding does happen across a whole publishing house, in that 10% of the titles makes 90% of the profits. The problem is that no one knows which titles will be part of that 10% until the sales figures come in.
  
  More importantly, royalties aren't a percentage of the profits, they're a percentage of the cover price (except in the case of some sub and trans rights, where it may be a % of net receipts). That's the key to how a publisher can make money when the advance hasn't earned out. Profit is made of cash from sales, minus cost of advance/production/sales/marketing, so as long as the cash which came in is enough and more to cover those costs, they'll make a profit. By contrast, earning out an advance is about numbers of copies sold, irrespective of the cost of making those sales happen in the first place: either the book sold that many copies, or it didn't. A canny publisher can make a profit by being tough on costs and/or selling tons, but being tough on costs won't affect how much money they owe the author.
  
  The key to your publisher being happy enough with your sales to offer you another contract is that sales were up to expectations, because the advance and all the other costs (except overhead) are based on expecations. Sales of, say, 800 in hb and 5000 in pb of a literary debut will be fine, based on modest costs and an advance of £3000, say, but would be catastrophic if the author had got £100,000, and costs had been run up on marketing and production to match, not least in order to try to recoup the advance. Put it this way, a friend at one of the big publishers, who shall be nameless, says that for one of their recent mega-flops, it would have been cheaper to give away a flat screen TV with every copy. Publishing is a gamble, and however hard-done by, with much reason, we feel, we have to acknowledge that publishers shoulder a huge financial risk every time they publish an unknown.
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  by Aonghus Fallon 2 years ago

  Thanks for all this EmmaD! It's very illuminating. I did read a book about the money side of publishing a few years ago, but seem to have forgotten most of it, and never thought about the distinction re royalties as a percentage of the cover price as opposed to a percentage of the profits. I realise publishers are the risk-takers financially, so I guess they are entitled to cut this sort of deal with the author.
  
  Re 'subsidising' - I just wondered if publishers kept royalties artificially low when compared to the profits they are making (although I can see this would be very hard to quantify, given all the variables) and ensured authors didn't complain via a bit of gentle psychological blackmail.
  
  After all, I can see no reason why the author's association (or whatever equivalent of a writer's union exists in the UK) couldn't pressurise publishers to increase the standard royalty payment. The Screenwriter's guild in the U.S. has won a lot of concessions for their members by their aggressive approach to negotiation. Or is it every author for him/herself?
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  by EmmaD 2 years ago

  Compared to, say, sixty or seventy years ago UK authors are actually in a better position than they used to be, largely thanks to The Society of Authors and the Writers' Guild who are the nearest things we have to a trade union (the former is more about books and publishing, the latter about scripts and broadcasting). Advances were unusual, and authors had almost no control over editing, or any rights to see the cover, nor could they send accountants in to audit their books' accounts so relied totally on their publisher telling the truth (in a trade notorious for creative accounting), while the publisher's cut of rights they sold on was 50% or more - which can be a lot of money if it's say US rights - instead of the 20% it usually is now. These are all now standard things which the two bodies have won for us.
  
  The other thing to thank is the advent of the professional agent: that's when advances really started to rise. Some blame our present troubles on this, which is nonsense: agents can't get more money if publishers won't pay it, and the rise has benefitted small-selling authors too. Indeed, if you looked at the figures I suspect we'd find that this decline in advances is towards figures which once used to be the norm. Which doesn't mean it doesn't matter, only that there's nothing new under the sun.
  
  I don't know if psychological blackmail comes into it: certainly it can be hard not to feel grateful to a publisher, since they're your gateway to your readers, and some find it hard to get out of the position of humble supplication which aspiring writers can't help assuming. That's one function of an agent: if you're too hard-wired for niceness they can be bossy and demanding on your behalf. But basically each book and author stands on its own. I've never heard of an author being told, 'If we pay you more we won't be able to afford to publish all your lovely friends.' not least because the chances of your writing friends being up for the same sort of contract with the same publisher are fairly small. It's more a case of 'If we pay you more we won't be able to afford to publish YOU.'
  
  But it is every author for themself, largely, I should imagine, because there are far more publishers and more potential book authors, and it's all more disparate, than scriptwriters and studios, so collective action is all but impossible to coordinate. I also wonder if there isn't a difference of mentality: scriptwriting is essentially collaboratively, whereas getting book authors to agree to work together is a bit like herding cats: by definition we're introverted individualists...
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  by Aonghus Fallon 2 years ago

  Many thanks again, EmmaD. It's good to know things have improved, and it's interesting to realise just how much of it is due to the professional agent (who is acting out of self-interest and rightly so) rather than the efforts of the writers themselves. I guess what we're looking at it is a case of the market correcting itself.
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  by John Taylor 2 years ago

  A first-time author I met has been advised to hold on to her ms for the time being by an agent friend, on the basis that agents are shedding rather than adding authors to their lists at the moment. Obviously, I don't know the quality of her ms, but the advice doesn't sound very positive.