Once upon a time (with one notable exception, mentioned below), the only literary agencies that engaged in publishing ventures were marginal agencies whose micro-publishing divisions existed in large part to make money on clients whose work they failed to place, or scams where agency clients were shunted into pay-to-publish arrangements (often without revealing the connection between the agency and the publisher). If an agency owned a publisher, you could pretty much automatically cross them both off your query list.
That’s no longer so.
Last week, prestigious UK agency Ed Victor Ltd. announced that it was going into publishing, with an ebook/print-on-demand division called Bedford Square Books. Bedford Square will launch in September with six titles, and will focus on backlist (out of print, rights-reverted) books by agency clients.
According to Mr. Victor (quoted in The Bookseller),
My colleagues and I have for some time been of the opinion that a number of great backlist titles by our clients, currently out of print or reverted, should be available to the book-buying public, either because they are as relevant as ever, or because they are classics in their field. We believe this is a valuable service not only for our authors, but also for readers. Although it is our intention to concentrate on our of print and reverted titles, we may publish original books if there is a compelling case to do so.
Only days later, two other major UK agencies–Curtis Brown and Blake Friedman–confirmed that they were considering similar ventures. And these three agencies are not alone. A few weeks earlier, citing frustration over trade publishers’ ebook royalty rates, agent Sonia Land released e-versions of 91 Catherine Cookson books via her own company, Peach Publishing. Similar frustrations spurred agent Andrew Wylie to establish Odyssey Editions in 2010, to epublish backlist titles from the agency’s many famous clients (a subsequent confrontation with Random House, which claims digital rights to pre-digital titles, was quickly resolved). In 2009, Scott Waxman of the Waxman Literary Agency founded epublisher Diversion Books, which focuses on new titles rather than backlist. And then there’s the granddaddy of them all, Richard Curtis’s pioneering Ereads, created in 1999 to publish electronic and POD editions of backlist books by Curtis’s clients and other established writers.
It’s no coincidence that members of the UK’s Association of Authors’ Agents are reported to be privately discussing whether to remove a clause in the AAA’s Code of Practice that prevents agents from acting as publishers. According to Piers Blofeld of Sheil Land (quoted in The Bookseller), “There are obvious issues and potential conflicts of interest, but at heart the role of an agent is to offer advice and support to a writer on their writing career. We’re here to maximise their earnings. We’re not simply there to act as an interface between authors and publishers—that landscape has gone.”
This potential new role for agencies reflects the rapidly-changing realities within the publishing industry. In a very tough publishing climate, agencies are looking for new revenue streams (publishers too, hence the pay-to-play divisions that are popping up at major houses–though with the advent of free electronic self-publishing, I think the POD bubble may be ready to burst). Just as important, the relative ease and economy of digital publishing makes backlist publishing a natural lateral move for agencies with deep catalogs of rights-reverted books and in-print books to which the publisher does not hold electronic rights. It’s an important trend, and I think we’ll be seeing many more of these ventures in the coming months and years.
So, good for agencies. Good for authors? That depends on the terms. Ed Victor will give authors 50% of net, but doesn’t say what net will consist of–and authors will be paid after only after production costs have been recouped from the initial receipts. Andrew Wylie has an exclusive deal with Amazon, limiting his books’ availability to the Kindle. Still, despite such uncertainties and/or limitations, publishing through their agents may be very appealing to authors who want to bring their out of print work back into circulation but don’t want to DIY (and despite the current frenzy over electronic self-publishing, there are plenty of them).
What about authors who do want to DIY, though? Having a publishing division might certainly be an incentive for an agency to discourage such efforts–and if the agency’s author-agent agreement includes interminable agency language, the agency might even be tempted to argue that its claim extended to publishing. What about authors who’d rather their agents tried to re-sell their out-of-print work to a trade publisher? If the agency has its own publishing division, how motivated will it be to do this for books it could easily and perhaps profitably publish itself? How much pressure might it bring to bear to encourage clients to allow it to exploit their rights directly? What about the allocation of resources–how much of an impact might running a publishing division have on an agency’s focus on selling new titles, even if the agency outsources much of the work?
And what about new clients with yet-to-be-published manuscripts, or existing clients whose manuscripts don’t sell immediately? So far, most agency publishing ventures concentrate on backlist–but that may not continue to be the case. For an agency with a publishing arm that publishes new work, to what degree might the prospect of publishing a client itself compromise its motivation to aggressively market the client’s manuscript to other publishers–or, for a prospective client, to offer a publishing deal rather than representation?
Even for unimpeachably reputable agencies, adding a publishing division poses a multitude of conflict-of-interest issues (as Piers Blofeld acknowledges in the quote above). For practical as well as ethical reasons, agencies that are considering an expansion into publishing MUST consider these issues, and come up with policies to address them. One possibility, for agency-owned publishers that will be issuing new work as well as backlist: raising an impenetrable wall between the different branches of the business–i.e., new work by agency clients would never be contracted by the publisher, and new authors signed by the publisher would never be offered representation by the agency.
A big part of the dizzying pace of change in publishing is the rapidity with which the lines are blurring–between publishers and self-publishing, between booksellers and publishers, between agents, editors, and publicists, and between agencies and publishers. More and more, there are no hard and fast rules, and nearly everything needs to be evaluated in context. To top it off, the scams are still out there. It’s more vital than ever to be an educated writer–to continuously inform yourself about the publishing world, and to keep abreast, as much as possible, with what’s going on within it.
In a universe of change, knowledge is your greatest ally–and your best defense.
No, they're not the same, and royalties paid on net profits are a major contract red flag.
I began to compose an explanation, but then it struck me that this would be a good subject for a blog post. Watch for it on Monday or Tuesday of next week.
Victoria, are royalties based on net profits and net receipts the same thing?
Interesting post, as always. In this fast changing world, it's hard to see where we're going. If agents are publishers, who's going to give advice to writers re publishing?
My impression is that the digital revolution has rocked traditional publishers to their foundations, opening cracks where agents have slid in and turned themselves into publishers.
So writers may well need new kind of agents…How about strengthening corporate structures that already knit together writers in a given genre, like the Romance Writers of America etc?
Good and interesting read.
If it concerns backlists, I'm convinced agencies opening a publishing house for backlist publication pose not that much of a conflict of interest. Out-of-print and rights-reverted material is available now and there are indeed a lot of writers who don't fancy DIY (me, for one).
My guess is that in the future there will not be such a thing as a backlist. With all the POD and e-book possibilities there is no reason for publishers to revert rights. They can keep a title alive forever at barely no costs.
Agencies know that too, though, and they will in future have to focus on publishing new material to keep their investment profitable. For backlist publishing will make them and the author money, but in time that will peter out. Only a handful of titles will sell forever.
The part on publishing new material, that in fact might pose severe conflicts of interest, unless both the author and the agency realize it will not be an author-agency alliance anymore, but an author-publisher alliance. Which will herald a new era. Or more precisely an old era: the publishing world before the agent came into being. Back to square one. 🙂
I've seen a number of less-than-reputable small publishers' contracts that pay royalties on net profit (wholesale price less production costs and other deductions). It's a way for an unprofessional or greedy publisher to shift costs onto authors. But net profit royalties are not something you expect to find in contracts from reputable publishers, either large houses or independents.
Sorry, where I have the word "analysis" it was supposed to be "analagous." Darn auto-correct.
Jeffrey 1:06, You're quite right about Hollywood accounting practices. However, it's not analysis regardless of whether you're talking about net or gross. In publishing, royalties are never based on *profits* at all. The author's royalty is calculated based on either the listed cover price of the book, or the net price, which is the price at which the publisher sold it to the retailer. Profits never enter in to the equation, nor does the price at which the consumer buys the book.
Rich, the contract language you quoted isn't new–it's been around for quite some time–I've blogged about it twice. It is indeed something to beware of. But with all due respect to Ms. Rusch's experience and success, I don't agree with what I feel to be the alarmist tone of her post (Ms. Rusch's husband, Dean Wesley Smith, has a major anti-agent bias, and I am guessing that Ms. Rusch shares that, at least to some degree).
Things are changing. Writers need to be careful–and educated, especially in the face of new ventures like the ones I've written about here. But most agents are not evil ogres licking their chops at the thought of the pounds of flesh they can extract from their clients.
Any business relationship depends on a balance of interests. A writer who blindly trusts his or her agent is a fool (something that has ALWAYS been so, for as long as agents have existed). But so is a writer who goes into every relationship expecting to be screwed. The reality, most of the time, will be somewhere in the middle.
Haters gonna hate. Writer Beware has at least two angry Anonymi haunting our blog and occasionally leaving nasty comments. (Guess why they're angry.)
Onelowerlight, it's true that it's incredibly easy to self-publish these days, and a lot of authors and author collectives (such as Backlist Ebooks, for instance) are taking advantage of that to re-issue out of print works. But many authors–especially older authors, whose works exist only in hard copy–are either intimidated by the process or just don't want or don't have the time to DIY. For those authors, I imagine that letting their agents do the work is very appealing.
Of course, as I said in my post, it all depends on the terms. Speaking for myself, I would never sign a life-of-copyright contract for digital publication of my backlist.
How much credibility should your vitriolic allegations carry with us when they don't even carry enough credibility with you for you to be willing to attach your name to them?
Oh, so when your friends who are literary agents start publishing ventures, it's not a scam because "you said so": But you can go and commit any kind of slander on anybody else that you want ? I get it now!! You are nothing but a bunch of pigs from the gutter, sorry but that's just an opinion, and I am entitled to my free speech.
The collapse of Leisure Books seemed to really start the ball rolling for the demise of the way publishing conducts business. As more people starting writing, good or bad, I imagine many decided to skip a first reading and a rejection by an apprentice at a publishing company or an agency and publish their own stuff. The big corporate publishers and their few almost pet writers will have to adapt or go under. It amazes me how fast the change is coming. When Amazon becomes its own publisher, things will change for sure. But it all boils down to promotion, and without major bucks, a promotional success is like hitting the lottery. If you must self-publish, do it yourself, don't pay anyone thousands of dollars for something you can do much cheaper yourself, and never sign away your rights in a self-publishing deal.
This is a clear conflict of interest and it smacks of desperation on the part of agencies to "maximize profits" and "leverage assets." Coupled with this long and illuminating post by Kristine Rusch, and it looks to be that there is a disturbing trend of agents representing their agencies interests moreso than their writers'. For example,
The agreement called for the agent to have the right to represent the writer’s work in all forms for the duration of the copyright of the work, even if the relationship between the agent and the writer was terminated. I blinked, damn near swallowed my tongue, and told the writer not to sign the agreement. Even though the agency was a reputable one, this clause was horrible.
Too late, though. The writer had signed the agreement a year before I looked at it, and something had happened between writer and agent to call that clause into question.
Who's going to advocate for the writer if the agent will not?
I don't understand why anyone with half a brain would sign on with these agent-publishers. Using free and open source software, I can produce a professionally formatted ebook in less than an hour–and I'm not a computer expert, just a blogger with a basic understanding of html. Why take only 50% of "net," whatever that is, when you could take 100%? And if the agents are providing other value that is exclusive to the epublishing process, why not contract with a freelancer for a fixed rate instead of paying a percentage for the life of the copyright?
And as for the piracy argument, Brandon Sanderson in his class at BYU made the very astute observation that anyone in this day and age can get a book for free–if not through piracy, then through a library or ebook lending. Readers are not merely consumers, they are patrons, and if they love your work, they will gladly support you by paying money for the product even when they could get the project for free.
RSMellette, that's a very good point about the ambiguity–both personal and professional–of negotiating a publishing contract with your own agent. Something I should have mentioned in my post.
Francis, I never feel more grateful to be in publishing than when I'm hearing about the film and music businesses. The stuff that happens there makes authors' problems look tame.
Just remember: Publishing is the only business that makes Hollywood look moral.
Actually, the gross vs. net issue in Hollywood isn't as clear cut. Having worked as one of those creative accountants I can tell you it gets very complicated very quickly. It's contract-based accounting, which means you'd better know what you're signing "break even" can mean many things. Even "gross" can be limited: "Gross Theatrical" "Gross Free TV" "Gross supplemental markets" – and what do you do when a studio sells your property to itself for well below market value? Gross might be a dollar.
That's why you need an agent. And why, if your agent is your publisher, you need an entertainment attorney.
It's mind-boggling to consider all the ramifications of the changes in publishing these days. And I am sure lots more changes are coming. I agree with Jeffrey who commented that authors need to be betting a percentage of gross, not net. Who wants to place bets on when that will happen?
Discussed just this issue with my agent last week – raised by him, I should add, not me – small agency and they won't be going down this route for the foreseeable future, but he too wondered about the problems which might arise from conflating two roles like this. As you say, with things moving and changing so quickly, it's as well to be aware of developments at least! Interesting post!
Noted the new ventures talk about ebooks mostly. The fact is that ANYTHING published digitally – books, music, video – is subject to piracy. If the day ever comes when digital is the norm, publishers are going to need an army of monitors and lawyers. As both a writer and a publisher, the only digital works are those intended to be free in the first place – casual poetry, essays, etc. For serious work, I'll stick to paper.
I do agree that the backlist, being low volume, is ideal for keeping authors' works available. I just don't see why the original publisher or author (depending on who has the rights) would need go to an agent/publisher particularly.
That would seem like a conflict of interest. At the same it's a natural move considering all you need to be successful in ePublishing is a networking platform and agents in theory know all about that, so what would the traditional publisher's role really be?
Hmmm…sounds like these agencies are hedging their bets. Smacks of some sort of like "insider trading" to me.
So does that mean that these agencies' writers have to go with the agency publishers once their rights revert?
Will the reversion clause not be in those agencies' contracts any longer?
Can a writer choose to self-publish their own out of print works at a price point of their own choosing?
Does the agency maintain the standard percentage of the profits or do they get a publisher's share?
Writer's should take a lesson from Hollywood where royalties are never, ever, ever based on net profits. All royalties are based on grosses because you can't trust studio accounting. Perhaps we'll soon need a new type of author advocate to help us negotiate with agents.
Hm, I was wondering the same thing as RSMellette…
I'm not one to be suspicious of literary agents, not even after this post. But it's extremely important to be AWARE of this, so thank you for bringing it to our attention! I had heard rumblings but didn't fully realize what was going on.
This sounds like the Manager vs. Agent issues in Hollywood. The former can be a producer, the latter can't.
So who does one turn to when negotiating a publishing contract with your own agent?