In convening a discussion on author contracts, Rethinking the Standard Publishing Agreement, Authors Guild executive director Mary Rasenberger arrived with an impressive trio of panelists:
- Michael Pietsch is the CEO of Hachette Book Group.
- Jonathan Lyons oversees the Literary Law Practice Group at Savur Threadgold LLP and directs rights as a literary agent at Curtis Brown in the US.
- Morgan Entrekin is the highly regarded CEO and publisher of Grove Atlantic.
Rasenberger drew her issues for the panel from the Guild’s Fair Contract Initiative; the Guild is leading a consortium of international author-advocacy groups in calling on publishers to effect contract reforms. She reminded the audience and panel that the Guild reviews as many as 2,000 contracts a year and that many are, she said, “the worst of the worst” for authors. For a quick review of the major points of the initiative, this PDF (archived from 2016) is especially helpful.
Rasenberger opened with the question of how long a publisher should have control of a contracted work. The Guild is proposing general contract durations of seven or nine years, which was pointed out in another panel as the contract term range being used by AmazonCrossing, the translation imprint of Amazon Publishing. Much more common is a contractual term that follows basic (US) copyright duration of “life plus seventy years.”
Entrekin revealed that he loses money on as many as half the books he publishes and that he makes acquisition decisions “not trying to think rationally, economically” but based on his conviction in the value of the material—which may not sell quickly and may need many years to recoup its costs. Still, he said, “I understand the frustration from an author’s point of view, particularly if the book isn’t being published in any aggressive kind of way. Nine times out of ten, if that’s the case and the writer or agent comes to me and asks for reversion” of the rights, “I do revert.”
Hachette’s Pietsch pointed out that, at a point between thirty-five and forty years, there is an opportunity for authors to request a reversion of rights, something “we’ve had many authors exercise,” which creates in many cases an opportunity to renegotiate. But if that potential came up more frequently, as in the seven- to nine-year time frame, he said, “that could have a significant impact on the financial dynamics” of the industry and make it harder to invest in new work.
In a curious counter to one of the Guild’s overarching arguments—that author contracts today are caught in the amber of an old, slow-moving industry—Pietsch went on to designate the long contract terms as a positive:
“There aren’t many businesses in America that have had the same companies intact for 200 years.” Publishing’s “somewhat stable foundation” has been dependent on its ability, he said, to hold contracts and pursue earnings on properties for so many years.
None of the panelists seemed wedded to the option clause, which generally says that a publisher gets first right of refusal on an author’s next book. But in terms of royalty rates—the Guild wants to see the author get 50 percent of net on ebooks—there was less clarity.
In looking at what authors make on print vs. digital sales, Rasenberger said that the Guild had considered Anthony Doerr’s acclaimed and much-awarded All the Light We Cannot See and had estimated that, in standard contractual terms, Doerr would get an average of $4.04 per copy for the hardcover and $2.09 for the ebook, while the publisher’s margin was estimated at $5.44 for the hardcover and $5.80 on the ebook.
Pietsch surprised some by saying he’d be interested in a flat rate across all formats. The current system is rife with special cases, negotiations over profit-sharing and escalators, and other factors that complicate rates. He also said that advances at Hachette have increased, in the aggregate, by some 50 percent in the past decade and a half.
Entrekin said that he’s “done a very wide range of profit-sharing” and other accommodations. He’s “had to learn to adapt and be flexible” especially when he might not be able to offer a major advance to an author “in order to be able to stay in business.” He went on to say, “So I’m open to anything anytime. I probably would prefer a profit-sharing deal to a straight royalty deal.”
Lyons, however, cautioned that “in these profit-sharing agreements where there’s no advance, it does make sense for the publisher to commit specifically to a publicity budget of some sort.” That’s where he sees problems arising. “In actuality, the publicity budget is being split 50-50 between the publisher and author. It’s just a question of committing to a certain amount of money, and that’s just something that publishers are still reluctant to do.”
Bottom line: In these and other parts of the exchange, what was demonstrated was that, as well-argued as the Guild’s canon of demands is, the vagaries of these issues in practice make the debate doubly difficult. The conversation, however, was helpful. More such sessions can only be of value as the industry tries to reposition itself in a more responsive digital context. Lyons said that he has, over the years, negotiated more than 4,000 contracts. All but around five of them, he said, did get signed. “And that’s because we’re all coming from the same place. We all love books.”
Jane Friedman has spent her entire career working in the publishing industry, with a focus on business reporting and author education. Established in 2015, her newsletter The Bottom Line provides nuanced market intelligence to thousands of authors and industry professionals; in 2023, she was named Publishing Commentator of the Year by Digital Book World.
Jane’s expertise regularly features in major media outlets such as The New York Times, The Atlantic, NPR, The Today Show, Wired, The Guardian, Fox News, and BBC. Her book, The Business of Being a Writer, Second Edition (The University of Chicago Press), is used as a classroom text by many writing and publishing degree programs. She reaches thousands through speaking engagements and workshops at diverse venues worldwide, including NYU’s Advanced Publishing Institute, Frankfurt Book Fair, and numerous MFA programs.
