eBook rights letter from Random House

[apbschmitz]

Over the years I've had a couple novels published, including one by Random House about 20 years ago. A few days ago I got a note from them, asking if I want to sign off on electronic distribution rights for a 25 percent cut of future sales. Given that there are no current sales to speak of, except for whatever occurs in the used book market, 25 percent of something seems better than 100 percent of nothing. But I wonder if others out there have received similar notes recently, and what your thinking about this is.

[Worldwalker]

You need to ask yourself whether 25 percent of what Random House will let you have for what they do to your book (DRM-locking it, for starters, and let's not even get into their pricing strategy) is worth more to you than 100 percent of what you can earn for yourself. My general rule of thumb is simple: Corporations are not my friends. They're not in business to be my friends, any more than I am to be theirs. In fact, what is good for them is generally bad for me, and vise versa. So if someone like Random House were to make me an offer, my first question would be "what's in it for them?" and my second "just how bad are they lowballing me?" because, when you're dealing with any corporation (or, really, any entity who is not a personal friend) that's what matters. In the case of Random House, publishers have demonstrated their bad faith in how they deal with both writers and readers, and I'd personally be very leery of accepting anything they offer, at least their first offer, because no matter what it is, it's going to heavily favor them. That's business -- and from the other side, good business is having your agent, attorney, or both, as well as other authors, scrutinize any offer Random House sends you. They're not doing it out of the goodness of their hearts, so the sooner you know the score, the sooner you can decide if you want to get into that game.

[wallcraft]

The 25% of something does sound ok. However, it is usually 25% of the 70% of list price that the publisher gets. This is now the standard rate, but there is a strong push by authors and agents to raise this to 50% (of 70%). If you publish yourself, the rate starts at 35% of list and is typically 70% of the selling price.

One place to find out more is The Business Rusch Publishing Series, for example Bad Decisions and the Midlist Writer (Changing Times Part 15).

One other issue is that big publishers price ebooks to protect paper sales. Since you have few paper sales this isn't good. Typical "self published" ebook prices are $4.99, or $2.99, or $0.99. These are low, but you get 35%-70% back and potentially attract more readers. Big publishers price ebooks from $7.99 to $12.99, and therefore make many fewer sales.

[Greg Anos]

Originally Posted by apbschmitz

Over the years I've had a couple novels published, including one by Random House about 20 years ago. A few days ago I got a note from them, asking if I want to sign off on electronic distribution rights for a 25 percent cut of future sales. Given that there are no current sales to speak of, except for whatever occurs in the used book market, 25 percent of something seems better than 100 percent of nothing. But I wonder if others out there have received similar notes recently, and what your thinking about this is.

You don't need to answer this publically, but ask yourself, what were your sales of the previous works? How much "remebrance" of your work still exist in the reader world? Like any business, this is a base number to guess sales at.

And if you self e-publish, you'll need to do lots of marketing work of your titles. On the other hand, you get a bigger share of the profits of your business. There was an article about this last week in the Wall Street Journal (I forget which day.) It's something to review and think about.

[AnemicOak]

Originally Posted by apbschmitz

Over the years I've had a couple novels published, including one by Random House about 20 years ago. A few days ago I got a note from them, asking if I want to sign off on electronic distribution rights for a 25 percent cut of future sales. Given that there are no current sales to speak of, except for whatever occurs in the used book market, 25 percent of something seems better than 100 percent of nothing. But I wonder if others out there have received similar notes recently, and what your thinking about this is.

I assume that's 25% of net not 25% of cover/list. Well, as you say 25% of something is better than 100% of nothing, but you might want to at least consider what other authors are doing with their backlist books and release it yourself. That does of course involve some work on your part and it depends on how much you want to do (formatting, cover design, marketing [although I doubt RH will do much marketing on a 20 yr old title], uploading to stores.

Here are some authors putting out their own backlist title(s)...
http://backlistebooks.com/authors.html

[pdurrant]

Originally Posted by apbschmitz

Over the years I've had a couple novels published, including one by Random House about 20 years ago. A few days ago I got a note from them, asking if I want to sign off on electronic distribution rights for a 25 percent cut of future sales. Given that there are no current sales to speak of, except for whatever occurs in the used book market, 25 percent of something seems better than 100 percent of nothing. But I wonder if others out there have received similar notes recently, and what your thinking about this is.

You might get some income from ebook sales. But Random House are unlikely to actually sell many. They're extremely unlikely to actually spend any money marketing your book. Are they intending to re-issue the book in paperback as well? If so, are they offering any kind of advance in return for this grant of new rights?

And all that ignores the fact that big publishers are extremely poor at accounting for ebook sales. See The Business Rusch: Royalty Statements

If you have the time and inclination, you might well be better off retaining the ebook rights and issuing it yourself as a Kindle ebook. You have to put in the time, but you get nearly 70% of retail of any sales, rather than 25% of 70% (= 17.5% of retail)

[pholy]

I third the recommendation to read the Business Rusch - the whole series if you have the time, but at least whatever seems relevant - there will be some, for sure.

It's not hard to do your own e-publishing - especially if you have original computer files, and there are people and firms that will help. Even the forums here can help, as the initial steps of publishing are not that much different from the conversions we do for the Patricia Clark Library.

[mr ploppy]

What would they do in return for the 75% of your income that they would be taking? I notice you already have something on Smashwords and Amazon, so presumably you know what is involved in publishing your own work in ebook form. Ask yourself if the time and effort you would save by not having to do it yourself would be worth giving away 75% of your income from now until 70 years after you die. If you have any descendents maybe you should ask them for their opinion too.

[pdurrant]

Originally Posted by mr ploppy

Ask yourself if the time and effort you would save by not having to do it yourself would be worth giving away 75% of your income from now until 70 years after you die.

A very, very good point. If you do decide to assign ebook rights, I'd suggest a fixed term contract — perhaps five years, at most?

[apbschmitz]

Thanks to all above, particularly for the link to The Business Rusch Publishing SeriesThat was a new one on me, and I forward to reading through it. I'm inclined to run an experiment — see if my cut from Random House on the long-dead book they published is greater, less than or equal to the take from my recently self-published eBook novel. Blessedly I don't have to decide today.

[pholy]

Another blog worth reading is Dean Wesley Smith's. The post linked is about agents acting as publishers, but DWS has also been doing a series on self-publishing and the business of writing. He is KKR's partner, by the way.

[jkz4000]

It's 25% of what your publisher gets. He gets 75% of the 100% after the Ebooker takes his cut. If lucky you will be good for 1.47 per copy which is SOP. That's on a $9.99 retail. If you got an agent he/she gets 15% too from your end. The math will kill ya. Today a midlist and lowlist author would be better off selling Ebooks him/her/self since the split is better and if not currently in print the rights SHOULD revert back to you. Check your contract. With a publisher authors get a raw deal with Ebooks. Especially backlist books---called "The Long Tail". Check it out. That's why you got the letter so the pub can make money off your old title for essentially doing nothing. No brainer here pal.

[wamerman]

It's entirely off topic, but I just read through your Amazon product description for Valentine's Cafe and felt compelled to tell you that is sounds like a hoot! Downloading the sample right now. Apologies for going off topic. It just seemed like a very inventive story.

--William Amerman