Rogue Digital Workshop

July 16, 2009 on 10:16 pm | In Elise, Uncategorized | 15 Comments

Emily and I went to the Rogue Digital workshop this morning. I’m going to post my transcribed notes here, but I also want to give my impressions. Emily has pictures and probably her own and differing impressions. So here’s my take.

First, let me thank the organizers of this workshop and those who participated. The workshop was sponsored (schwag, room rental, etc.) by Books on Board, Red Sage Publishing, Quartet Press, Samhain Publishing, and Smart Bitches, LLC.

A special and warm and toasty awesomeness mention goes to Bob of Books on Board, who not only provided rockin’ door prizes, but also pushed the boundaries of sheer awesome-tude with his attitude. Not only was he gracious and warm, he was also genuinely invested in the future of e-books in general, not just at Books On Board. So… special recognition to Bob!

Overall, it was an interesting mix of information, some very general, some very specific, and almost all of it useful. Lauren Dane and Maya Banks were gracious and generous in opening up their experiences to the group, and all the presenters were well-prepared. Kassia Krozser of Quartet Press talked about contracts and some things to be concerned about with regards to contracts and digital rights. Jane Litte of Dear Author talked about the Google Book settlement. Sarah Wendell of Smart Bitches, Trashy Books talked about the comparative cost of self-publishing a print book versus an e-book, Angela James of Samhain Publishing talked about the e-book business model and myths regarding digital publishing. Jane came back to put questions to Lauren and Maya.  There was good schwag, and the tenor of the workshop was informative and instructive. I’m glad I went. Even if it was at 8:30am.

These notes are intended as helpful information, and any mistakes in my listening or transcription are totally on me. So, here are the notes (bear with me, they are extensive):

Kassia Krozser talked about contracts

Territorial rights are now a real concern. With digital publishing, limited territorial rights can rob the author and publisher of sales; digital media readers are very impulse-driven, if they can’t buy it right now, they’ll move on to something they can buy. Since the point of sale is instantaneous, lack of rights in a market may lose that sale

Release pattern is a matter of significant debate. Some argue that a staggered release (traditionally, hard cover, trade paper, mass market paper; more recently, where do digital editions fit in this release schedule?); others argue for simultaneous release. This goes back to that immediate gratification digital readers are seeking

Digital publishing may be moving away from royalties on cover price toward royalties on net.  This is particularly the case as more content is sold on discounted sites like Amazon or other distributors. If the publisher has to pay royalties on cover price, but is only making a fraction of that from the discounter, it significantly impacts ability to put out books.

As an author, it’s key to make sure your royalty structure is as beneficial to you as is reasonable – since you obviously want your publisher to stay in business, you need to be cognizant of the business climate. [jane interjects question: how do you protect yourself as an author while still reflecting the real-world concerns of distribution costs? K responds you need to be aggressive in asserting all publication rights, shopping them around if necessary, perhaps disconnecting print and digital rights]

Possible trend toward chunked content [definition note: chunked content is selling book piecemeal – in a way similar to itunes selling songs as well as full albums, consumers would be able to buy individual portions of a work, say a single poem or essay, or only one author’s work out of an anthology]

Subscription and serial content. This is currently experimental, but Kassia thinks it’s definitely coming.

Authors should consider all possible compensation, not just monetary. Publicity is also compensation.

DRM – Kassia indicates that while it is not totally evil, it’s probably not the best tool to accomplish the goal.

Reversion of rights – this is a big issue with older print runs and the possibility of new digital options opening up for content. As an author, be sure your contract language is very clear (and favorable!) with regards to what constitutes “out of print” and when your rights revert back to you.

Jane Litte talked about the Google Book settlement.

Still in approval stage

DoJ is looking at monopoly ramifications, particularly pertaining to “orphan” books (those for which the copyright holder is unknown or cannot be found)

Most fiction writers come under “commercially available” and “in print” categories

Anything printed prior to 2009 is subject to the settlement UNLESS YOU OPT OUT. This is not an opt-in settlement. The assumption is that you agree to these terms unless you specifically opt out.

Terms: 63% of revenue generated is paid to the Registry set up by the settlement.

The Registry consists  of two representatives for author, two for publisher, but no language on how these representatives are chosen, or what recourse is available if “rights-holders” are unhappy with representatives’ performance.

Registry keeps an “administrative fee” out of the revenue deposited to registry. That fee is not spelled out by the settlement.

Registry then pays the revenue out to the publisher “regularly.” There is no designated schedule for payment of these revenues, this schedule is set by Registry.

If there is a conflict between rights-holders, the matter goes to arbitration with an arbitrator designated by Google and the Registry.  Conflicts between publishers have recourse to the court system, but under the settlement, authors do not have recourse to the court system.

The settlement does not do a good job of addressing reversion of rights or situations with multiple rights-holder (anthologies, for example)

If there are conflicting instructions regarding content from multiple rights-holders, the one which is most restrictive trumps.

If you want to know how the settlement might affect you and/or your works, don’t ask your publisher. Since they are a stakeholder, their answer will reflect their understanding of their best interest. You should ask your agent or an appropriate lawyer.

In addition to the specified revenue streams, Google has made mention of other possible revenue streams for content, including subscription services and print-on-demand services.

It is imperative that the author consider how the settlement may affect him/her and decide whether it is in his/her best interest to remain in the settlement or opt out.

Sarah Wendell – costs associated with print and digital self publishing

Shared illustrative numbers from an author who self-published a book in both print and digital formats. Here are the numbers:

Print: costs included time, formatting, editing, cover art, ISBN, typesetting costs, print copies. Total cost, not including distribution costs or marketing/promo/etc. $5538.50.

E-book: costs included time, formatting, editing, cover art, ISBN, ebook formatting software. Total cost, not including distribution costs or marketing/promo/etc.: $3821.42.

Point: self publishing e-books is nearly as expensive as self-publishing print books.

Angela James talked about the e-publishing model.

The model for digital publishing has been around since the early 1990s, and hinges on no advance, but a higher royalty rate.

Digital publishing has some good content, but because it is easy to set up a digital publisher – all you need is a website and content – there is a “crapload of crapalacious” stuff out there, too.

When digital publishing started, the market was very limited, so the possibility of earning out an advance was nearly non-existent. This led to the development of the model of large royalties on cover price instead of an advance.

Because e-pubs are not constrained by the need to earn out advances, the publisher can take more risks on content and explore more niche markets. This allows digital publishers to be ahead of trends instead of behind them (paranormal, m/m, ménage, for example)

Digital publishers still need to pay back the costs of the book, but the royalty model allows more flexibility in doing so.

Big misconception is that digital publishers have huge profit margins.

35-40% of cover price goes to the author.

40-75% goes to distributors (assuming publisher is using distribution sites other than their own website. Note that this puts the total over 100% already. However, because publishers can negotiate downward on the distribution costs, Angela assumes 40% for purposes of this exercise)

Editors (in e-pubs, editor pay is often royalty based) get another 5%

Flat costs associated with the book: copy editor, cover art, formatting, marketing, promotional costs, business overhead.

Angela estimates the average e-book for her makes about 5% profit. That is, for every $1 made by selling books, Samhain pockets around 5 cents on average.

Why shouldn’t epubs do advances? Because instituting advances means that in order to assure profit, epubs would have to eliminate risk, which means that they would revert to, essentially, the NY paper pub model.

Because epublishers put out so many books, how do you know when you are cannibalizing sales? Angela says careful scheduling is key  and that the sticking point would be when you don’t have break-out authors anymore. If you are so saturated in your market that no author can break out of the pack, then you are probably cannibalizing your sales.

Jane with Lauren and Maya

Jane: How long before you earn enough that you would be PAN eligible?

Lauren: Usually in the first month. Definitely by the second month.

Maya:  The same, the first two months. The first day is the most sales, then it drops off after that.

J:  Have any of your single title digital releases sold more than your advances from NY publishers?

L: Almost all of them.

M: Almost all of them. The e-books have certainly outsold advances from earlier NY contracts

J: Do you still make money on your backlist in digital publications?

M: I love Kindle. Yes, the backlist plateaus, but Kindle will often give you a spike in sales.

D: Yes, I’m still making nice money off my backlist. The backlist spikes when there’s a new release.

J: Do digital backlists sell better than print backlists?

L: I can’t make a comparison because I don’t have the numbers.

M: I can’t tell monthly numbers because of how print is reported, but the ebooks are very steady, but the print books have sold more.

J: Both of you continue to publish in digital even though you are in print. Why?

M: I like monthly checks. If I contract an e-book, it’s published within 6 months and I start getting paid right away. There’s also a lot of cross-over buyers. My e-pubs have definitely helped sales of my NY books.

L: The money and the immediate feedback of knowing how you are doing. E-publishing allows me to write the book I want to write, a lot more flexible. NY is more writing to market. [side note: Angie notes that she still R’s Lauren’s stuff]. I value my readers and like to follow up, too.

Questions:

Q: How do you get your rights back?

L: Think about what you will and will not sign away, think about what is important to you and what you are willing to negotiate in the contract.

Sarah: You are taking on the role of your own business advocate, so you have to be cognizant of that. “If you don’t like it, don’t do it.”

Q: What were the four types of revenue in the Google Books settlement?

A)    advertising B) commercial/retail sales C) institutional subscriptions and D) per page print fees.

Q: What is a huge red flag about epublishers?  If they won’t negotiate the contract, is that a red flag?

Angie: Some things in the contract should be negotiable, but not everything in the contract will be negotiable.

Sarah: she and Candy renegotiated world digital rights after the book was published, so never too late to ask

Bob: Romance loses sales because of lack of worldwide digital rights. Be sure you have them.

Jane: many publications aren’t willing to negotiate modification of worldwide digital rights language, and how can the author exploit that? Also, at what point does the balance shift to digital publishing as an attractive option for authors?

Margueritte Labbe: some red flags for me are spelling errors in the contract, bad formatting. Be sure to ask questions of other authors published with that publisher, and trust your instincts.

Q: [from twitter!] How do you get crossover readers?

M:  Mainly from a good website and by talking to readers.

D:  The publisher site, promotion and marketing. “You are your own best promotion.”

Q: At what point do you consider an e-book to be successful?

Angie: 750-1000 copies, but it varies. More copies needed for shorter books.