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Posts tagged ‘Random House’

More on the Hydra – SFWA kerfluffle

Back when Random House announced it was starting several new digital only imprints, I greeted the news with more than a hint of skepticism. I’ll admit that the main reason was because I haven’t been impressed with how RH —  or any of the other so-called Big 6 for that matter —  has handled the transition to digital media. But I held out hope that this was a step forward. It was a faint hope, mainly because RH was being mum on contract terms. That is usually a very big red flag that something is wrong.

Well, my concerns appeared to have been valid when SFWA issued a statement saying Hydra, the RH sf/fantasy digital imprint, was not a qualifying market. Among the concerns SFWA had about the Hydra contract are 1) no advance is paid; 2) authors are forced to pay via deductions from royalties for services most legitimate publishers do for free; 3) contracts are for the life of copyright.

Now, to become an active member of SFWA, you have to meet certain requirements. You must have “three qualifying short story sales, one qualifying novel sale, or one professionally produced full-length dramatic script”. If you follow the links, you’ll see what “qualifying” means. Basically, for short stories, you have to be paid at least $50 for each qualifying short story and have a cumulative total in sales of at least $250. For novels, you have to have at least one paid sale of $2,000. That is an advance of $2,000 and not sales of that much.

Random House was pretty quick in its response to SFWA’s action. It posted a response that basically said “you never talked to us and gave us a chance to respond to your concerns.” There’s an offer to meet with SFWA leadership at their earliest convenience to discuss just how wonderful Hydra is and why SFWA is all wrong about it. But the justification in the letter are stunning and not in a good way. Random House proves just how low of an opinion it has of authors and our intelligence.

Let’s begin with the fact they are calling Hydra and its sister-imprints a profit-sharing venture between publisher and author. WTF?!? They justify taking out the normal business costs most publishers, including small and micro publishers, take on by saying these costs could be so much higher and more “stressful and labor-intensive” if the author were to self-publish. The implication is that the author should be soooooo glad Hydra wants to publish their book that they open their pocketbooks and pay for the opportunity. In other words, we ought to forget the old adage that money flows to the author and pay for the privilege of having a publisher put out our book, make empty promises to us and takes money out of our pockets.

Oh, and smile as they do so for the life of the copyright! Do I really need to tell you how bad that is?

But the saga doesn’t end there. SFWA has responded to Random House’s response. There is no doubt, as you read the response, that SFWA leadership means business: You extol your business model as “different”; the more accurate description, we believe, is “exploitative.” Oh my.

The response also makes clear that, while the lack of advance is a very big stumbling block, it isn’t the only one and possibly not even the main one. SFWA also notes that one of their officers has seen the contract for one of Hydra’s sister-imprints and it has the same terrible clauses. That shows a pattern and not a good pattern.

But what gets me is how surprised Random House is acting about this. It’s as though they didn’t think anyone would have concerns about this contract? Didn’t they remember what happened when Harlequin started up their new digital line that was basically nothing but a vanity press? Both SFWA and MWA quickly listed the line as a non-qualifying line for pro sales. Harlequin finally not only changed the terms of their contract but also the name of the line in order to get past the problems.

This conflict between Random House and SFWA points out problems with both sides, in my opinion. First, it shows just how low publishers are willing to sink in order to screw authors. Second, it shows that SFWA is still behind the times because it doesn’t admit that there are those of us out here who are publishing through small digital presses that don’t pay advances and some of us are making far in excess of the $2,000 advance SFWA requires for active membership. As for their requirement of a cumulative $250 in payment for three short stories, there are authors who make much more than that in indie short story sales for ONE STORY. But those authors also aren’t eligible, at least not the way I read the guidelines.

We haven’t seen the end of the Hydra story yet. I just wonder how long it will be before another of the big publishers tries this same sort of head in the sand, let’s screw the authors even more than we are now schtick.



And people wonder why the industry is in the shape it’s in

This past Sunday my critique group met and, as usual, we talked about what’s going on in publishing. One of the topics we discussed was something Kate brought up in her post last week: Archway Publishing. In case you missed Kate’s post, Archway most definitely isn’t a publisher I’d recommend any author go running to. In fact, I suggest you run far and fast in the opposite direction from it. But that was just the tip of the iceberg in news from an industry that is, frankly, trying to tread water as it attempts to figure out how to survive in the digital age. Unfortunately, its efforts aren’t doing anything but keeping the bean counters afloat a bit longer. The backwash from its efforts are drowning, metaphorically speaking, authors and readers who still think they can trust legacy publishers.

I won’t spend much time on Archway because Kate did such a great job discussing it. However, here is the basic information. Archway is the demon child of an agreement between Simon & Schuster and the infamous Author Solutions. Read this article from Let’s Get Digital for more information about some of the red flags this new venture is raising. Be sure to follow the links in the article as well. If that’s not enough to make you pause before even considering submitting to Archway, remember the old adage: money flows to the author, not from the author. Don’t get blinded by the offer of 50% royalty. That comes only AFTER you have paid for your “publishing package”, a package that will cost you at least $1,999 — and that’s without the additional editorial, premium cover and layout design, etc., they will try to sell you. Ask yourself how many books you’ll have to sell just to break even. So run, don’t walk, as far and as fast as you can away from this new venture.

In the Better Late Than Never Department, Barnes & Noble has finally expanded its PubIt (and that is still a stupid name) program across the ocean. PubIt has finally found its way to the United Kingdom. If you already have e-books for sale through PubIt and stated that you have worldwide rights, it was automatically put on sale in the UK. Pricing will be automatically calculated based on your US sales price unless you click off the box telling it to do just that. While I understand BN’s desire not to rush into anything, the fact that it is so far behind in coming to the UK, much less other overseas markets, makes me wonder if they are still looking at digital sales as something of an anomaly that will go away if you wait long enough.

Then there is the next entry into the Do They Really Think We’re That Dumb Department. In the wake of their announcement that they will be merging with Penguin, Random House has announced the launch of three new digital only imprints. Alibi (which has the worst logo ever. Whoever thought a magnifying glass turned with the handle facing the bottom left would make someone think of an “a” needs to have their eyes checked.) will be the new mystery imprint. Hydra is the new science fiction/fantasy imprint and Flirt the new imprint for “college age New Adult audiences”. We won’t even go into the “new adult” tag. These three imprints join Loveswept, the romance digital imprint.

The reason I tagged this announcement as the latest in the DTRTWTD Department is multi-fold. Let’s start with their announcement of the new imprints. How many PR types were involved in getting the right level of rah-rah-rah before this was sent out. They are “excited to launch three new digital imprints, alongside the existing digital imprint LOVESWEPT, that will feed today’s savvy readers by bringing the best, the boldest, and the newest voices directly to them . . . this digital-only program will seek out the best and brightest names in the next generation of authors, enabling us to cultivate a team of writers in the publishing world’s most prolific and lively genres.  The format will allow us to publish more quickly and to nimbly embrace what’s new in each genre, delivering exciting, fresh, and varied new works every month directly to the digital devices of today’s most eager readers.   Dedicated to affordable, accessible, and accomplished genre fiction, these four imprints will have unprecedented potential, both in terms of breadth and scope.”

Oh, and every book will be assigned to “an accomplished Random House editor and a dedicated publicist. They will also have the invaluable support of Random House’s experienced marketing and digital sales teams, who know how to reach out to and expand each book’s dedicated readership. Not only will authors benefit from working with the finest cover designers to ensure irresistibly eye-catching books, but they will also be offered the unique advantage of social media tools and training that will allow them to connect directly with their readers.”

Now, excuse me for a moment while I laugh hysterically. Am I the only one who “hears” more than a touch of panic in those words. Random House is one of the Big Six, soon to be Big Five. It is one of the publishers that has continued to try to bail sea water out of its leaky row boat in the middle of the digital revolution. But now, it is going to be on the cutting edge of the revolution and will welcome with open arms the newest and brightest of authors into its fold. Gag.

I’ll admit I’m a cynic. As I read the bit about the accomplished editor and dedicated publicist, I laughed. Ask most any author currently under contract with RH about their publicist. Heck, ask about what sort of publicity their books receive and almost every one of them will tell you there is no promotion. So is it any wonder I find it hard to believe RH is going to actually have promotion for this new line?

My cynicism grew with the bit about working with cover designers and being “offered the unique advantage of social media tools and training”. That sounds like so many of the ways companies like Publish America and Author Solutions manage to get money out of authors that it has my internal alarm sounding loud and long. Note that RH says authors will be “offered” these advantages, not that they are part of the program. I may be wrong but it sounds hinky to me.

You can check out their submissions process here. Note that the general submissions page says they invite “queries”. Also note that they define “short content” as being between 15,000 and 30,000 words. What had me scratching my head was how they say novel-length content is “customarily” defined as being between 40,000 – 60,000 words. I don’t know about you, but it’s been a heck of a long time since I’ve seen a SF/Fantasy novel at a mere 60,000 words. Some romances, yes. But even mysteries are running 70 – 80,000 words still, especially if the author is hoping for print editions.

I checked out the submission link for Hydra, the sf/f imprint. It was pretty much as expected. There are boxes for you to fill out with your name, title of the book, length of the book, etc. They want to know if the book is finished. You can include up to 1,500 words of your work along with the query letter. There is also a space for you to give the book blurb. There are two boxes that caught my attention. The first is where it asks if you have an agent. Folks, if you have an agent, you’d better be darned sure of your contract with them before you submit to any publisher on your own. If your contract is such that they represent everything you write, then you need to be letting them submit your work wherever. At least make them earn their cut of your earnings.

The second box that caught my eye was where RH asks for your publishing history. Now, at first glance, this isn’t anything untoward. Why wouldn’t a publisher want to know if you have anything else out there. But then the cynic in me kicked in again. Are they asking to see if you have a history of being able to finish work and get it into the hands of readers? Or are they asking so they can check your Bookscan numbers to see if you have sold enough to make it worth their while to publish you? Or, even worse, are they asking because they don’t want to work with an author who has had the audacity to self-publish? Remember folks, there are documented cases of authors being dropped by their publishers because they self-published works completely unrelated to what they had sold to the publisher.

Reading through the FAQ also raises some concerns. Because there is no sample of their contract language, the issue of what rights they’d want if they accept your manuscript comes into play. You’d think since this is a digital only imprint, they’d be interested only in digital rights. Don’t bet on it, not when one FAQ entry notes “While most of our titles will be published exclusively in digital to start, some may find a home in print as well.” I’d bet this means their contract will tie up not only digital rights but print — and all other rights — as well. So, if you do submit to them and you are offered a contract, have an IP attorney read it closely.

Another red flag for me is that there is nothing that I’ve seen on the site that discusses contract terms or royalty rates. Oh, the announcement notes that the titles published under these new imprints will be affordable and accessible to readers but it doesn’t give an estimated price range. Nor does it discuss if DRM will be applied. There are a lot of unanswered questions so far and, based on RH’s history, I’m not convinced this is anything more than another way for them to try to line their own pockets at the expense of readers and authors. So, if you choose to take this path, beware and don’t sign anything without reading it very closely.

As I said, I’m a cynic. That means I tend to look at these “wonderful and earth shattering” announcement from legacy publishers with a jaundiced eye. The choice is yours to decide if you want to go this route — either with the new imprints from RH or with Archway. If you do go that way, please make sure you protect yourself by having an IP attorney go over anything they send you to sign. Most of all, remember that money is supposed to flow to the author from the publisher and not the other way. Determine how long and how many books you’d have to sell to make back the investment if you are asked to pay for publishing services.

Amazon strikes again — or did it?

I’ve been laid low this past week by a bug that was both nasty and persistent. It’s been a very long time since something has knocked me out the way this did. What I didn’t realize was how long it had been working up to the final knock-out blow. Now, as I start feeling human again, I can look back and realize that I’d been ignoring it for several weeks — almost a month in fact. The lesson is that I have to start listening to my own advice and pay attention to what my body tells me. (Quit laughing, Sarah. I know I tell you this all the time.)

The problem is that I was entering the home stretch on one novel and had a good feel for how to finish another when this bug laid me out. These are two very different novels, not only in genre but in voice and feel. Worse, the next book in the Nocturnal Lives series was coming together in my head. Now, it’s all gone. I’m going to have to go back and reread the novel I was working on finishing and hope I can get back into that zone. Then I have to get into the second novel, something that is very different from what I usually write. My biggest concern is that I won’t get the ideas back for the Nocturnal Lives novel because, duh, I didn’t write them all down. (Bad Amanda!)

It also means I haven’t been paying as much attention to what’s been happening in publishing as I usually do. I know there was a flurry of twitter-talk about Random Penguin’s buy buttons disappearing for a brief period of time last week over on Amazon. The usual conspiracy theories rapidly emerged. Amazon was doing it in preparation of taking the Random House/Penguin ebooks off-sale if the publishers didn’t play nice. Amazon was doing it as an implied threat to all publishers. The last I saw, Amazon said it was a glitch in the system. Maybe it was, maybe it wasn’t. It doesn’t matter. The case of the disappearing buttons lasted for a very short time and occurred at a time when sales would not have been high. As I said, unless and until more information is known, it really doesn’t matter what happened or why. The buttons were restored and it was pretty much a case of no harm/no foul.

Then there was the story on the news last night about how Amazon is losing the e-reader market. I’m sure it doesn’t surprise any of you to know I heard the story and wondered if I’d somehow been transported to another reality. So, after doing my blog for Nocturnal Lives (my personal blog) this morning, I went looking for confirmation of the report. Color me not surprised to find out the reporter doing the story went for shock factor and not facts.

According to Publishers Weekly, Amazon’s Kindle family is used by 55% of e-book buyers. This is up from 48% for this time last year. Apple, with the iPhone and iPad, holds a 15% share of the market. This is up 2% over last year. It is interesting to note that the increase came from iPad use. According to PW, iPhone use as an e-reader fell 2% over the past year. Barnes & Noble’s Nook held steady at 14%. Note, however, that this is down from their high of 22% in the third quarter of 2010.

So where, you might ask, did the reporter come up with the headline that Amazon was losing the e-book reader battle? I wondered the same thing. So I checked the breakdown from PW and the light bulb went on. The Kindle, as opposed to the Kindle Fire, has seen decreasing use. It has fallen from 48% last year to 37% this year. Ooooh, that means the Kindle is dying.

No, it doesn’t. What it means is that there is still a large portion of the e-book buying public that wants a dedicated e-b0ok device. However, with the introduction of the Kindle Fire, those who want a multi-use tablet/e-book reader that doesn’t cost as much as a laptop have a viable option. All you have to do is look at those numbers to see what I mean. The second quarter of 2011 showed no Fire market. As for the second quarter of this year, Kindle Fire sales account for 18% of the e-book reader device sales. Not only does that cancel out the losses for the Kindle, but it increases the market share for the Kindle family by eight percentage points (if my math is right).

But saying that Amazon is increasing its hold on the e-book device market wasn’t nearly as exciting as saying the Kindle was dying. Sigh. Rolls eyes.

Now to go find breakfast and to start wading through all the emails and work that is waiting for me. Maybe I’ll even be able to get some writing done today.

More Random Penguin and other thoughts

It’s election day in the U.S., so thoughts are scattered, to say the least. So, in the closest I’ll get to politics on this blog, I’ll simply urge those of you who haven’t voted yet to do so. And so ends the political bent of today’s post. Now onto the continuing saga of Random Penguin and other publishing news.

Let’s start with the “other” news first. Publishers Weekly has announced that e-books took a 22% share of the market during the second quarter of this year. This is up “only” 1% from the first quarter of the year but represents an increase of 14% over the same time last year. To put this into perspective, hard covers and trade paperbacks dropped 2% and mass market paperbacks dropped 3% (assuming I’m reading the article right).

Now, the naysayers will say that this means e-books are reaching their maximum sales rate. I disagree for a number of reasons. The first is that the figures come from Bowker and there is no explanation for how they came up with their figures. If they are using the same sampling method, or one similar to, that used by Bookscan, then the figures are merely an estimation of sales and not actual numbers.

The second, and more important, reason I don’t think we are seeing the point where e-book sales go flat or start decreasing is because there is an artificial ceiling in place right now. That artificial ceiling is DRM. It prevents most people from buying their e-books from a variety of major stores. Most folks think that if they have a Nook, they can only buy from Barnes & Noble. It’s the same with the Kindle or the Sony Reader, etc.

Going hand-in-hand with this is agency model pricing. Publishers following this model are pricing e-books higher than they are mmpb versions, causing people to delay buying a number of e-book titles they would otherwise. The problem with this is that it doesn’t lead to delayed sales. It leads to no sales because folks forget about going back to buy the mmpb when it comes out. This is not a situation of time making the heart grow fonder. No, it makes the brain forget.

The interesting thing pointed out by the article is that while BN physical store sales seem to have fallen, independent bookstores are holding firm. Yes, they represent only a small part of the market, but they are doing something right. Their numbers remained where they were. This is a situation where no growth is a good thing. As long as they hold steady, they can build on what they are doing right and correct what they aren’t doing right. They aren’t locked into a corporate business plan that doesn’t consider local needs or wants. They can, in short, serve the needs of their customers and build a strong customer base.

And now we have the latest on the Random Penguin merger. Scott Turow, president of the Author’s Guild, has weighed in on the merger, calling it “an unsettling announcement”.

His first concern is that the announcement understated just how much of the U.S. market the newly merged company would control. He says the 25% figure cited by Random House is more likely 3t%, with the share in certain markets being even higher. Because of this, he states that the proposed merger “merits close scrutiny” from the antitrust folks at the Department of Justice and FTC. Pardon me if I find it slightly ironic that he is now asking for DoJ to look at this possible merger for antitrust violations and yet he condemned the DoJ for looking into the alleged collusion between Apple and the five publishers for price fixing.

I will give it to Turow for cutting to the chase when it comes to the reasons behind the merger. He buys the cost-cutting arguments put forth in the announcement about as much as I do, especially if they don’t close any lines or conduct major and massive layoffs. As Turow says, “those potential efficiencies for such large publishers are probably minor.  Economies of scale only go so far.” He’s right. Just as he’s right to say that this proposed merger is more about trying to cope with the changing “ongoing restructuring of the book industry”.

Turow goes on to note that the new mega-publisher will have greater negotiating power with retail outlets. His concern is that it will come at a great cost to the literary market and, as a result, to readers. “There are already far too few publishers willing to invest in nonfiction authors, who may require years to research and write histories, biographies, and other works, and in novelists, who may need the help of a substantial publisher to effectively market their books to readers.” He’s right there. It is a problem we already see and one which, I fear, will be compounded by this merger.

But my concern goes even further. As noted in an earlier post, I doubt the new company will keep all 250 or so imprints alive. I doubt we will see more authors and new titles being offered. What I do see are more poor imitations of what they see as their best sellers and the newest, bestest fad. This is bad news for readers and for authors. It is yet another reason why I think we will see more authors going indie or going with small presses, no longer the bane of the industry.

Bigger isn’t always better and, I’m afraid, Random Penguin will prove that adage. I hope I’m wrong, but my gut says I’m not.

Random Penguin

Last week I received an email from a friend — hi, Taylor! — who asked if I’d seen what was heating up the twitter feeds from a lot of folks in publishing. That was the first I’d heard about the possible merger between Random House and Penguin. I read the initial articles and then read the next group where it was speculated that Rupert Murdoch might throw his hat into the fray. I’ll admit, I both laughed and shook my head in bewilderment at the way some folks were greeting the possible merger with tempered joy and yet the thought of Murdoch getting involved sent them scurrying like rats looking for shelter. Whether it was because they don’t like Rupert’s (AKA Fox News) politics or were afraid he’d actually require writers to write what readers wanted and not the politically correct tripe some of them have been cranking out, I don’t know and, frankly, I don’t really care.

We now have confirmation that the two publishing houses will be merging. Random House’s parent company will be the majority owner and will have more members on the board of directors. (You can see the official announcement at the Random House site.) It is anticipated that it will be the second half of next year before the merger is concluded — and that assumes there are no legal complications along the way. Considering the fact this is a merger of multi-national companies it is possible that it will take longer and that any significant delay might cause the agreement to fall apart.

Still, it is interesting to see how the media is handling the announcement. The New York Times notes that this merger could “set off a long-expected round of consolidation as the industry adapts to the digital marketplace.” John Makinson of Penguin who will serve as the new company’s chairman noted that they decided to make this move now, so they wouldn’t be “a follower”. Sounds to me like he realizes they were late getting into the e-book era, or at least adapting to it, and is now trying to avoid doing that as the landscape of publishing changes. The question is, is this concern not to be left behind again so great that the companies made a knee-jerk reaction and jumped before they should have?

Some hard facts. The merger will create the largest “consumer book publisher” in the world. It will have a global market share of something like 25%. This market share is based on such current best sellers as Fifty Shades of Grey as well as Penguin’s backlist of classics from authors such as Orwell.

There is speculation that one reason for the merger was to combat the growing influence of Amazon and, to a lesser extent, Apple. Forbes specifically noted Amazon’s growing footprint in publishing as the company continues to woo authors to the KDP platform as well as expanding its own publishing lines. It wouldn’t surprise me at all if that wasn’t one of a number of considerations for the merger. However, whether the creation of a Super-Publisher will take much of a chunk out of Amazon remains to be seen. My own thought is that it won’t. At least not unless the new Random Penguin figures out how to have a consumer driven user interface with good customer service.

Other details of the merger have continued to emerge. Random House’s parent company will own 53% of the new Random Penguin and will nominate five directors. The remaining four directors will come from Penguin’s parent company. There is also a clause requiring the two corporations to retain their interest in the merger for at least three years. Makinson, Penguin’s chairman and CEO, will chair the new company and Random House CEO Markus Dohle will be the CEO. It is claimed the new company will save money on warehousing, distribution, printing and “central functions”.

But this is what interests me and, to be honest, is something I find hard to swallow. “We will have more than 250 imprints in this company,” Dohle said in an interview with Reuters. “We want to preserve and give those imprints even better and richer resources.” Okay, color me skeptical, but how often do two companies merge and there aren’t changes in the way both companies operate? If this merger is to make more money, does anyone really believe they won’t cut those imprints that aren’t pulling their weight?

And this is what worries me as a reader and as a writer. Not only does the merger of two of the Big Six mean there are now fewer players to bid on works out there making the rounds, it means there are going to be even fewer slots, at least for a couple of years, for new authors to break into. It also means that authors who are publishing through the imprints that will be cut — and don’t fool yourselves into thinking there won’t be casualties — may very well find themselves with orphaned works they can’t get back without jumping through legal hoops.

I’ll be honest, I’ve already talked with a couple of authors I know who have books with one or the other of these publishers. I’ve told them to check their contracts and their statements. If they have rights they need to get back,, they need to do it now, before they get tied up in the lengthy merger process. Authors and their works are nothing more than assets to these companies, something to be traded on and used. So here’s my advice to each of you. If you are an author with either of these houses, check your rights. Do what you need to do to protect yourselves because the companies won’t.

If you work for these companies as editors or support staff, I hope you are getting your resumes together because there will be personnel changes. You’ve seen it before as the companies downsized. Get ready for the next round.

As an aside, I hope everyone in the New York/New Jersey area is safe this morning. My thoughts have been with all of you in the path of Sandy.

If it’s Tuesday. . .

This weekend was my first vacation in a long time. Three days without trying to write, edit, read slush, etc. What I quickly discovered was that I needed the time off–badly. Even when I’ve supposedly taken time off the last few years, I’ve always had the laptop with me and that means I still tried to work some. This weekend, which was devoted to all things family at my son’s university, had none of that. It was great. The problem is, I came home exhausted, spent all day yesterday making a very small inroad into the stack of stuff on my desk and now my brain isn’t working. I think it is still in bed. Maybe that’s why my head is echoing so badly. So, the post I’d planned on for today will wait until next week because I have to be able to think to finish it. Instead, I thought I’d post links to a several articles of interest.

1. Random House’s e-book price increase for libraries. Here are two articles concerning whether libraries are or are not boycotting RH after the publisher’s exorbitant price increases. The first is about a group of libraries that are boycotting RH and the second casts doubt on whether there is a large-spread boycott.

I tend to agree more with the second article. Libraries will be cutting back on the number of RH e-books they order, but they won’t boycott. The reason is simple. It is important to remember that library patrons don’t know how much their local library has to pay for a book, be it digital or hard copy. All they care about is that they are able to check the book out. This is becoming especially important for those patrons with e-book readers. So, in order to keep their patrons satisfied, libraries will continue ordering from RH, if at lower numbers. After all, these same libraries are still having to explain to their patrons that they have nothing to do with why the patrons can’t check out e-books from Penguin, et al–the other members of the Big Six that refuse to release their e-books to libraries.

2. Hatchette on DRM

This is probably the one story I had to read several times, and from several different sources, to make sense of. The basic issue came when Maja Thomas of Hatchette called DRM a “speedbump” that doesn’t prevent e-book piracy.  Thomas went on to say: There’s a misconception that somehow the digital format of books has made piracy increase, or become logarithmically more serious. But piracy was always very easy to do, because scanning a physical copy of a book [takes] a matter of minutes. A physical book doesn’t have DRM on it.

As I read this, I was nodding, even smiling a bit, because someone at a legacy publisher was finally getting it. Could it be that Hatchette was coming to its senses? Had a cold front finally hit Hell? The short answer is a resounding “NO”.

From Hatchette CEO, Tim Hely Hutchinson: DRM (Digital Rights Management encryption, on which we insist) divides opinion. Our view is that the advantages greatly outweigh any perceived disadvantages. While DRM cannot prevent file-sharing by the most determined pirates it can and does act as a brake on the casual sharing of files and, in the overwhelming majority of cases, it works in the background without causing problems for anyone.

First off, he only sees “perceived disadvantages”. I guess I just “perceive” a problem in trying to buy an e-book from Amazon and then read it on a Nook, or vice versa. Or I just “perceive” it as a problem when I lose my Adobe Digital Editions account and can no longer legally read those DRMed titles on any reader or computer.

Second, he seems to think it is only the “most determined pirates” who are out there breaking DRM. I have issues with that statement on two levels. First, the fact he is calling everyone who breaks DRM pirates. That implies, at least to me, intent to illegally distribute a title after DRM has been broken. Now, unless you include reading a title on a different type of device, also owned by you, as piracy, then no. Most people breaking DRM are doing so in order to make viable backups of their e-books that they know they will be able to read in years to come, no matter what sort of device they own at the time. My other issue with this is that it doesn’t take a lot of determination to break DRM. Less than two minutes of googling will take you to sites with step-by-step directions or to a site where you can download plug-ins for Calibre to do it for you. It isn’t hard to find or do.

So, there is no change in policy at Hatchette and, at least for the moment, DRM is going strong among legacy publishers.

3. Department of Justice’s investigation into Apple and 5 of the Big 6 for price fixing.

Yes, I’m still smiling over this. After two years of waiting for someone in the legal system to realize exactly what Agency Pricing is, the DoJ finally seemed to be stepping forward. The news coming out about the investigation has been generally sparse and comments are usually from unnamed “persons” close to the investigation. In other words, the news may be reliable or it may not. Only time will tell.

Reuters has reported that a settlement may be reached between DoJ, Apple and at least some of the publishers in the upcoming weeks. Possible outcomes could include Apple no longer being able to force publishers to agree not to price their e-books lower at other outlets than they do at Apple. It could also shift pricing responsibilities from the publishers to retailers. In other words, it could return e-book pricing to the “wholesale model” that had been in effect prior to Apple’s entry into the market and the advent of Agency Pricing.

If this happens, it is also possible that the results will trickle down to small presses and self-published authors. Part of the contracts we agree to with Amazon, B&N, etc., when we put our e-books up for sale through them is that we will not offer our titles for less anywhere else. In other words, we are agreeing to our own form of Agency Pricing. It will be interesting to see if there will be a trickle down effect from the retailers with regard to those enrolled in the KDP, PubIt and similar programs. I doubt that there will be. However, it is something we will have to keep our eye on.

Okay, I’m off to find another cup — or six — of coffee. Then I must finish the final edits on Nocturnal Haunts. Then I have digital proofs to check before I approve ConFur (a short story in the ConVent universe by Kate Paulk), First Blood (a short story by Sarah Hoyt, writing as Sarah Marques, in her Vampire Musketeers universe), Pinked Djinn and Candy-Blossom (short stories by Dave Freer) for publication. Then it’s on to checking the digital proofs for Scytheman, book two in Chris McMahon’s trilogy begun with The Calvanni. And that’s just the tip of the iceberg.

Tuesday Thoughts

by Amanda S. Green

For the past week, I’ve been pretty vocal about my feelings about the Amazon v. IPG dust-up, Random House’s huge increase in the price of e-books for libraries and the double standard some authors have when it comes to Barnes & Noble v. Amazon. What these three issues are indicative of is the way the industry is changing. And, as with any major change, folks are taking sides. Some are clinging with their last fingernails to the old standard. Others are embracing the change with open arms, seeing change as a necessary step if the industry is to survive.

Me, I love the changes even as some of them scare me. But change is necessary. Publishing has become stagnant, relying on business plans that became out of date with the dawning of the digital age. I’ll give you the fact that the last five years have brought more changes in technology and consumer demand than most anyone could have predicted. However, when those changes started happening, and when they started being embraced by the consumer public, publishers should have taken a moment to think about it and then they should have started acting. But they didn’t. Instead, they tried to build protective walls around the old model, hoping beyond hope that the changes would soon disappear and authors would continue trusting all that came out of the gilded board rooms in New York City.

But the public has embraced the new technology. More than that, the public has become vocal thanks to that new technology. Social media, discussion boards, websites and blogs such as this one have become sounding boards for readers and authors to talk about what they see as the problems with traditional publishing. E-books are here to stay, whether the legacy publishers like it or not. The question now becomes, are they going to go the way of so many record labels or will these publishers find a way to survive?

If legacy publishers are to survive, they are going to have to take steps now. There is a lot of negative consumer feelings to overcome, not to mention bad business practices for years now. Then there is the growing discontent of authors, especially a number of mid-list authors, those same authors who have been the workhorses for the publishers and yet have also been the least appreciated authors over the years. So, what do they need to do?

With regard to the purchasing public, it’s really quite simple. First, publishers have to stop believing the public is as dumb as it seems to think. The average person does understand that it doesn’t take a much money to produce an e-book as it does a hard copy version of the book. Most of the time when you see a publisher or distributor trying to justify the high price of their e-books, they list the same services being needed for the e-book as are needed for the hard copy book, i.e. cover design costs, editing, proofreading, page design, etc. They don’t seem to get that we know they aren’t designing new covers or doing completely new edits for the e-book as opposed to the hard copy. Heck, after the last two e-books I’ve read from major publishers, I’ll lay odds they don’t have anyone doing quality control on them. And, before you ask, one of them was a NYT best seller and yet the layout was horrible and difficult to read. The errors in the text were mirrored from the digital edition to the paper version. So, no, that argument doesn’t fly.

The truth of the matter is, publishers are still trying to protect print sales, especially their hard cover sales, from being diluted by e-book sales. So, instead of staggering releases, they price the e-book as much, if not more, than the mmpb version. Now, there are those readers out there who will pay the higher price for some authors, just as there are those readers who will rush out to be the hard back of certain authors’ books. But to charge $9.99 or more for a book that has been out for years, in paperback, is ridiculous.

Something else publishers need to do is get away from the agency pricing model. Readers want to be able to shop around and find the best price for a book. By letting different online vendors discount e-books at their discretion, just like stores can do with their stock, it will help drive sales. They don’t have to give complete pricing control over to the vendors. But there should be some wiggle room for the vendors, something to help encourage them readers to buy an e-book they might not otherwise because of the cost.

There is something else that, to me, is just as important than lowering price. If publishers are to win back the trust and loyalty of readers, they have to do away with DRM. Digital rights management didn’t work with music. It isn’t working with e-books. People want to be able to read their e-books across different platforms. They don’t want to lose the ability to read an e-book because the have changed computers, etc., and no longer have a “license” for a particular title. They don’t want to have to go through a lot of hoops, some of the technically illegal, to read an e-book bought from Amazon on their Nook or from B&N on their Kindle.

There are two different levels this would have to be changed. The first is on the publishers’ end. They add their own DRM to books AND they limit the number of devices it can be read on. Most limit their titles to 4 – 6 devices, but I have seen some limited to just 1 or 2. I don’t know about you but that is limiting. In my household there are two PCs, two laptops, two kindles, an iPod touch and a tablet. Guess what, that is more potential reading devices than would be allowed to read most titles from legacy publishers.

The second level of DRM comes from the retailer, be it Amazon or BN or Sony or whomever. Many of them will tie an e-book download to a particular device. In other words, if you tried copying a title on your kindle and reading it on your laptop, there’s a good chance you wouldn’t be able to because of different device IDs. That needs to change.

Yes, yes, I know what the argument is. DRM is attached at both levels to prevent piracy. I even saw a quote earlier this week where a publishing insider commented that DRM was there to “encourage” readers to do the right thing. In other words, publishers think most of us are crooks and would sends hundreds or thousands of copies of our e-books out, cutting into publisher profit. I don’t know about you, but I’ve just been insulted.

The real issue is what are we, as customers, buying when we buy an e-book. Most of us think we are buying the book, just as much as we are buying the book when we buy the hard cover or paperback version. But, according to the publishers, we are only buying a license to read the book, hence all the restrictions. This is also why we can’t sell an e-book after we finish reading it.

The reality of it is, publishers are in a huge battle to win back readers. Over the last couple of years, traditional publishers have taken black eye after black eye, usually because of actions by the big six. Price increases on both print and digital version have cut into the public’s ability to buy as many books as they once did. The very short shelf life of most books in stores. The declining quality of editing, proofreading and even the physical construction of books has become a concern. We hear more about the lack of editing and proofreading in e-books because, for whatever reason, those errors seem to stand out more than they do on the printed page. Yet, all too often, if you compare the two versions, you’ll find the same errors in both. Then there are the books that fall apart after being read only once or twice, the ones with pages missing or whole sections printed upside down or backwards. Yes, I’ve had it all happen to me as have a number of others.

But where the publishers are really hurting themselves, because they are harming public institutions, is their stance with regard to libraries. The big six’s decision to either not make their e-books available for loan or to limit those loans to an artificially low number or, sigh, to charge what can only be called extortionate fees for these e-books hurts every library patron, even those who don’t read e-books. How? By forcing libraries to decide what books, or e-books it won’t purchase for its collection in order to buy e-books.

Oh, I can hear the publishers now. They’ll tell you they are willing to “discuss” these terms–if libraries give them enough statistics to warrant it. Besides, they’ll say, no one but the librarians will know. Well, no to both. First, the statistics they’re asking for don’t exist right now and are such that libraries can’t collect them. How in the world is a library going to tell a publisher how the loaning of an e-book will impact the sales of that same e-book or the hard copy version of it? How can a library discuss the impact of being able to loan the digital version of a book v. the number of times the physical copy of that book is loaned out IF THEY CAN’T AFFORD THE DIGITAL VERSION?

As for the myth that no one but librarians will know, I laugh. No, I guffaw. Librarians aren’t the meek, silent stereotypes from the old movies. They are professionals who have to justify their budgets to their city and county officials. They talk to their patrons. In this day and age when libraries are fighting for finances to stay alive – and they are adapting to the changing technologies and demands of their patrons – they aren’t holding back.

And shall we talk about the way publishers treat many, if not most, of their authors? Smaller and smaller advances, that somehow never seem to earn out. No push or promo for books. Late payments. Quarterly or semi-annual payments, even on e-books. Dropping authors, saying their books just didn’t catch on with the public, when those authors’ books are still available on bookstore shelves a year or more after publication (and this in a time when most books don’t stay on the shelves more than a month, maybe two unless it hits best seller status). There’s more, but you see where I’m going with it.

Is it any wonder the public is starting to look at traditional NYC publishers with a jaundiced eye?

Is it too late for legacy publishers to change course and survive? Quite possibly, at least if they want to continue in their current configuration. The next few years will be interesting, not always fun, often scary, but publishing will survive. There will be casualties, however, and I have a feeling a lot of them will be in NYC as the guilded board rooms realize they are on the publishing equivalent of the Titanic.

(Cross-posted here.)