Thursday, March 21, 2013

Publishing Terms at Autharium

Posted by Victoria Strauss for Writer Beware


NOTE:
Since this post was written, Autharium has modified and improved its Terms and Conditions. Please see the addendum at the bottom of this post.  

Over the past few weeks I've gotten a number of questions and alerts about author-unfriendly Terms and Conditions at Autharium, a new epublishing startup. So I thought I'd check into it myself.

Autharium describes itself thus:
Autharium was created with the purpose of discovering great writers and publishing their work. The idea struck the co-founders Matt Bradbeer, Simon Maylott and Aaron Bell when they discovered and became frustrated with how difficult or expensive it was to publish a book, break through the old publishing routes and reach readers...

There is no charge to be published and distributed through Autharium, there are no hidden costs and the royalties are always split in the authors [sic] favour. Our mission is to discover and publish the next great books and the authors behind them.
Authors can use Autharium's online tools to upload, format, and edit their books (which sure sounds like self-publishing, although, according to Autharium's FAQ,  books are "curated" and not everything that's submitted is published). Once books are uploaded, authors can can send them to the Autharium community for comment and review, or submit them for publication. Payment is 85% of net revenue.

Autharium is in beta, and currently free to use. However (and despite the language quoted above), wording on the site and in the Terms and Conditions strongly suggests that there will be publishing and other fees at some point in the future.

So far, Autharium sounds like one of those combination writing communities/self-publishing services, a la Book Country, YouWriteOn, or the recently-defunct WeBook. As long as there's a decent community sharing feedback, and the publishing service is free or low-cost, where's the problem?

As is so often the case, in the publishing agreement.

Trouble appears in the very first clause of Autharium's Publishing Terms and Conditions for Authors (I've bolded the significant language):
1.1 By submitting your Work to Autharium and accepting these Terms & Conditions, you grant to Autharium the exclusive right and licence to produce, publish, promote, market and sell your Work in any Digital Form...in all languages throughout the world for the entire legal term of copyright (and any and all extensions, renewals and revivals of the term of copyright).

1.2 You agree that Autharium shall also be entitled to license retailers, distributors, agents, licensees, sub-contractors and other third parties to exercise the rights you have granted to Autharium under this Agreement.

1.3 The rights granted in paragraphs 1.1 and 1.2 above shall also apply to any adaptation or any abridgement of your Work or any substantial part of your Work.
In other words, by submitting your manuscript to Autharium for publication, you are granting exclusive digital publishing rights to your work, and to adaptations/abridgements of your work, in all languages, for the entire duration of copyright, as well as the ability to license those rights to others. That's a pretty sweeping grant of rights--not what you typically expect to find in the contract of a self-publishing service.

If Autharium decides not to publish your manuscript, it will notify you, and the grant will terminate immediately. But until you receive such notification you are bound to Autharium, and cannot publish your work anywhere else in digital form. Since there's nothing in the contract that requires Autharium to be prompt, or gives it a timeframe in which to respond, you could be waiting for a while.
 
It gets worse. Authors who publish with Autharium can remove their work from sale at any time--but this "will not terminate this Agreement nor cause the exclusive digital publishing rights that you have granted to Autharium...to revert to you." So you can terminate your book--but Autharium will still hold the rights and you won't be able to publish elsewhere unless you can get Autharium to give you permission. (Enquiring minds can't help wondering whether, in such a case, a fee might be involved.)

In fact, per Autharium's Term, Termination, Reversion and Suspension of Rights clause, authors have no termination rights whatever unless Autharium breaches the terms of the Agreement and fails to remedy the breach, or allows a work to become "unavailable in all editions" (and "available" might just mean an ebook for sale on Autharium's own website).

There is so much wrong here.

- A life-of-copyright grant term. I've said elsewhere that life-of-copyright grant terms are not a problem as long as there's precise reversion language that ensures that authors can get their rights back once sales fall below stated minimums. However, that's in reference to publishers--not glorified self-publishing services like Autharium. Life-of-copyright terms are completely inappropriate for such services (this is one of the things that made the agreement for Dymocks' recently-terminated D Publishing service so horrific). Even a fixed-term contract isn't desirable when you're self-publishing.

- An exclusive grant term. Exclusivity is also not desirable when you're self-publishing, unless the publishing service is offering something major in return (such as payment for ebook lending, as with Amazon's Kindle Owners' Lending Library). You want to be able to maximize sales and readership by publishing to as many platforms as possible; exclusivity prevents you from doing that.

- A claim on rights beyond ebooks. Autharium publishes "in Digital Form," which is sweepingly defined as "any and all electronic and/or digital forms and media whether now known or later invented or developed." This conceivably could include not just ebooks but audiobooks, enhanced ebooks, and video games. Additionally, Autharium claims the right to publish in all languages, and to license your rights to others. All of this negates one of the main benefits of self-publishing: minimal encumbrance of your rights. A self-publishing service should not require you to grant rights beyond those necessary to provide the service.

- Authors cannot terminate at will. Another of the major benefits of self-publishing is control. If you lose the right to terminate an agreement at any time, for any reason, you're giving up a huge amount of control--especially if the terms of the agreement don't allow you to publish anywhere else.

- Inadequate definition of out-of-print. See life-of-copyright, above. If you can't terminate at will, there should at least be clear, objective reversion terms that allow you to regain your rights after a fixed period of time or once sales fall below stated minimums. Otherwise, the publishing service can hang onto your rights for as long as it chooses, whether or not your book is selling. Autharium's vague out-of-print language, the effect of which is to enable it to keep a death-grip on your rights as long as a single electronic edition of your book is available on a single website somewhere, is completely inadequate.

- Will eager authors discover these unfavorable terms? I signed up for Autharium and uploaded a document. I got as far as the Publishing Options page, where, before they can submit for publication, authors are required to check a box to accept Autharium's Terms and Conditions. Not only is it not stated that these are the publishing terms and conditions (there are also general terms and conditions), the link provided goes nowhere. Often enough, authors barely skim Terms and Conditions or publishing agreements, even when they're easy to find. Making authors work to find them is practically a guarantee they won't be read.

In response to criticism elsewhere, Autharium staff have argued that Autharium is a publisher, not a self-publishing service, because "we do not publish everything submitted." However, publishers don't leave formatting, editing, and cover art to authors, or allow authors to set book prices. Those are hallmarks of self-publishing services. And even if we cut Autharium a hundred miles of slack and agree it's a publisher, its reversion language still sucks.

All in all, a bad deal for authors.
EDITED 11/1/13 TO ADD: Autharium's Publishing Terms and Conditions have been changed.

- The Publishing Terms and Conditions now make clear--and the Autharium website has been re-vamped to ensure--that merely submitting work for feedback by the Autharium community does not subject that work to a grant of publication.

- By submitting for publication, you are still granting Autharium an exclusive license to your work in digital form, as well as adaptations and abridgements of your work, which Autharium can in turn license to various third parties. But instead of the legal term of copyright, the grant term has been shortened to five years. This is renewable automatically (and apparently indefinitely), but after the initial five years you can email Autharium at any time with a termination request, and your rights will be reverted. You can also revert rights three years after publication if your book has sold fewer than 20 copies in its third publication year or in any year following.

- You can petition at any time to remove your work from sale (though this doesn't terminate the agreement).

-The definition of "Digital Book Form" has been limited as follows: "For avoidance of doubt this does not include physical or audio book forms, videos, film, television, merchandise or game forms."

- Autharium is still free (apart from the 15% cut Autharium takes of sales revenue).

I'm still concerned that the exclusive nature of the publication agreement, as well as its claim on "adaptations and abridgements", isn't ideal for a self-publishing service (and I would still define Autharium as a self-publishing service, despite its provision of an editorial review). Overall, though, the terms it offers are greatly improved.

Friday, March 15, 2013

For Those of You Who Are Wondering Why Someone Might Want to Launch a Class Action Lawsuit Against PublishAmerica

Posted by Victoria Strauss for Writer Beware

Here is an example of the sort of solicitation PublishAmerica authors receive daily (if not more often).

http://www.publishamerica.com/

Dear author:

For authors with multiple titles only!

The March Madness Multi-title option is here!

We're offering two of our most popular services for ALL of your books, for one low price!

Your own Literary Agent

+

Direct Book Distribution

combo package

for ALL of your books

That's right, ALL your books, one low price, two high exposure services!

**Go to www.publishamerica.net/MarchMadMulti

to activate this super combo deal for only $179.

Direct Book Distribution: Bookstores that use Direct Distribution receive a bookstore discount of up to 55 pct, which is more than 10 times than what they may get elsewhere. And the books they order to carry are returnable . This means that the bookstore can return unsold copies to PublishAmerica's direct distribution center.

Our March Madness Multi-title option will add ALL your books to our Direct Distribution system. Your local bookstore will love it. In fact, we'll get on the phone right away to negotiate the bookstore's first next order of of any one, or all, or your books! They will also keep their Ingram option. PublishAmerica books are non-returnable through Ingram.

PLUS

Your own Literary Agent for ALL your books:

We'll shop ALL of your books around the industry! Our literary agency department takes their job very seriously. Last year they submitted PublishAmerica books to publishers all over the nation and the world. We'll contact publishers and urge them to take a serious, close look at every one of your books for a possible transfer of publication rights. We'll let them know that should they be interested, we'll clear the path and transfer the rights to them smoothly!

The average agented book was introduced to 15 other publishers in 2012. The vast majority of these are U.S. publishers, some really big; twenty percent is foreign, including countries as far away as Germany, South Africa, Australia, India, and Spain.

** Go to www.publishamerica.net/MarchMadMulti to activate today! You will be contacted within 48 business hours by our Special Services Department so we can begin working for your ALL of your books in earnest!

Must choose a shipping option to activate. No use of coupons is allowed.

Include ALL of your books today!

Thank you,
--PublishAmerica Special Services Team

Tuesday, March 12, 2013

Random House Announces New Terms at Digital Imprints Hydra, Alibi, Loveswept, and Flirt

Posted by Victoria Strauss for Writer Beware

Yesterday afternoon, I had a cordial conversation with Allison Dobson, Director of Digital Imprints at Random House, about the the recent controversy over deal terms at Hydra, Alibi, Loveswept, and Flirt.

Based on strong criticism from writers' groups, authors, and agents, Random House has decided to make major changes in its digital contract. Allison was kind enough to share these changes with me. She asked me to keep them confidential until they could be officially posted on the Random House website, which is why you didn't see this post yesterday.

A pdf of the announcement is here. Briefly, here are the changes:

- Authors will now be offered their choice of two options: a re-worked profit-sharing arrangement and a traditional advance-and-royalties deal.

For the profit-sharing arrangement, there's still no advance. But Random House has eliminated all chargebacks for digital editions, so the split between author and publisher is 50/50 of net revenue (actual sales income) from the first copy sold. In other words: no setup costs, no 10% deduction for sales and marketing. For print editions, if they are produced (and this won't be frequent; these are primarily ebook imprints), there will still be a chargeback for actual production and shipping costs (these costs will be fully broken out for the author ahead of time if a print edition is planned). Random House will cover general publicity costs for the imprint, and up to $10,000 of book-specific publicity. Any book-specific PR above that amount will be borne by the author and deducted from net revenue before the profit split--but such expenditures will be optional.

For the advance-and-royalty deal, authors will receive a traditional publishing contract, with the publisher covering 100% of costs. There will be an advance, and royalties will be paid at Random House's standard ebook royalty rate of 25% of net.

- The contract will still be life-of-copyright, but the reversion clause has been improved. As I've explained on this blog and elsewhere, I don't have a problem with life-of-copyright, as long as it's balanced by precise reversion language. That is now the case. Three years after publication, the author can demand reversion if sales fall below 300 copies over the 12 months preceding the demand.

- Random House will still take both primary publishing rights and subsidiary rights, but performance rights and transformative digital edition rights are no longer included. If Random House wants to acquire these, it will negotiate separately. Random House is also open to negotiation on other subrights.

Overall, I think this represents a significant improvement. I was impressed with Allison's openness to discussion, and with what seemed to me like a sincere commitment to responding to criticism and making the digital imprints' contracts more author-friendly.

Monday, March 11, 2013

Another Class Action Suit Launched Against PublishAmerica

Posted by Victoria Strauss for Writer Beware


I wasn't optimistic that I would ever be writing a post like this, after the class action filed last year against PublishAmerica was dismissed.

However, on January 31, 2013, the Maryland law firm Z Law and the New York law firm Giskan Solotaroff Anderson & Stewart (the same firm that is currently investigating Author Solutions Inc.) filed an amended complaint (the original complaint was filed last November) against Willem Meiners, Larry Clopper, and PublishAmerica LLLC on behalf of Diana Waterman, Jennifer Grant, Danita Clemons, and the class of PA authors in similar situations.

The amended complaint was filed in the Circuit Court of Maryland for Frederick County (case number 10-C-12-003498 OT), and can be read in full here. The electronic case record can be viewed here.

Plaintiffs allege breach of contract, unjust enrichment, fraud, violations of the California Business and Professions Code (for untrue advertising), violations of the California Unfair Competition Law (for unlawful business acts and practices, unfair business acts and practices, and fraudulent business acts and practices), and deceptive acts and practices under New York General Business Law.

The allegations of fraud, unjust enrichment, and breach of contract are similar to those of the earlier complaint, but where the previous complaint sought judgment under the Maryland Consumer Protection Act--and was dismissed in large part because it failed to adequately demonstrate that PA authors should be treated as consumers under the Act--this complaint focuses on laws governing business acts and practices, both in Maryland and in the home states of the named plaintiffs. Does it have a better chance of success? That remains to be seen.

The complaint's Preliminary Statement is worth quoting in (nearly) full.
2. Defendant markets itself as a “traditional advance and royalty paying book publisher” that is home to over 50,000 authors.

3. As PublishAmerica openly states on its website, it specializes in books and authors “who face and overcome hardships and obstacles in life.”

4. Defendants shamelessly prey on ambitious first time authors and those who have faced significant personal hardships, luring them into exploitatively long contracts, often as long as ten years -- that can only be broken for a high fee.

5. On its website, PublishAmerica uses the tagline: “We treat our authors the old-
fashioned way–we pay them.” Nothing could be further from the truth. PublishAmerica makes money from its authors, not for them. As alleged below, authors published by PublishAmerica have no chance of selling their books to a general audience.

6. PublishAmerica makes its authors’ books unsellable in a number of ways. The most obvious is pricing. Plaintiff Waterman’s paperback children’s book is priced at $24.95. By contrast, Curious George, a beloved children’s book, is available online at Houghton Mifflin Harcourt for $6.99. In fact, Plaintiff Waterman’s book is priced significantly higher than all of New York Times’ ten best-selling children’s books. See Exhibit 1 attached hereto.

7. PublishAmerica sabotages its authors’ ability to sell and market their books by printing them with errors. These errors are inserted by PublishAmerica itself. Plaintiff Grant’s book has glaring typographical errors. On the side binding of the book, the word “collection” is misspelled as “collectrion.” If that were not enough, on every other page, the title of the book is misspelled, replacing “romantically” with “roimantically.” These errors humiliated Grant once the book became widely searchable on the Internet. Notwithstanding these glaring errors, PublishAmerica prices Plaintiff Grant’s book at $30. This price is notably higher than the top ten selling fiction paperback books. See Exhibit 2 attached hereto.

8. The simple fact is that the only consumers who will purchase these overpriced, poorly published books are the authors themselves.

9. PublishAmerica then bombards its authors with services ostensibly designed to promote, improve, and sell books that PublishAmerica knows cannot be sold. But as alleged below, these services are often themselves a scam or simply fictitious. For example, PublishAmerica offers to correct its own publishing errors – for a fee.
I've highlighted the allegations that were unfamiliar to me. Although they fit perfectly with the many other aspects of PublishAmerica's business model that Writer Beware has received complaints about over the years, I still find them shocking. The complaint includes many other gems, including a couple of PA's famous "tone" letters and examples of PA's solicitations for bogus marketing services.
 
Plaintiffs are asking the court to approve the class, to order PA to release and return publication rights, to order PA to pay actual damages, restitution, and court costs including attorneys' fees, and to order "such other, further relief as may be determined to be just, equitable and proper by this Court, including but not limited to punitive damages."

The contact person for Giskan Solotaroff:

O. Iliana Konidaris
11 Broadway, Suite 2150
New York, NY 10004
Direct: 646-366-5140
Fax: (646) 964-9610

I'll keep y'all posted as this works its way through the courts.

Thursday, March 07, 2013

SFWA De-Lists Hydra; Random House Responds

Posted by Victoria Strauss for Writer Beware

Following on my post last week about unattractive deal terms at Random House's new digital-only imprint, Hydra, the Science Fiction and Fantasy Writers of America has determined that Hydra will not be a qualifying market for SFWA membership.
SFWA has determined that works published by Random House’s electronic imprint Hydra can not be used as credentials for SFWA membership, and that Hydra is not an approved market. Hydra fails to pay authors an advance against royalties, as SFWA requires, and has contract terms that are onerous and unconscionable.
In a blistering blog post, SFWA President John Scalzi also criticized** Hydra's terms:
This is a horrendously bad deal and if you are ever offered something like it, you should run away as fast as your legs or other conveyances will carry you.
Today, Random House responded to the critics, including me, in an open letter. As the letter requests, I'm posting it here in full, redacting only Ms. Dobson's phone number.
Dear John, Victoria, Jaym and SFWA Members,

We read with interest your posts today about the new Random House digital imprints and our business model. While we respect your position, you’ll not be surprised to learn that we strongly disagree with it, and wish you had contacted us before you published your posts. We would appreciate you giving us an opportunity to share why we believe Hydra is an excellent publishing opportunity for the science fiction community by posting ours below to them.

Hydra offers a different-- but potentially lucrative--publishing model for authors: a profit share. In the more traditional advance- plus-royalty model, the publisher takes all the financial risk up front, and recoups the advance before the author earns any cash royalties. With a profit-share model, there is no advance. Instead, the author and publisher share equally in the profits from each and every sale. In effect, we partner with the author for each book.

As with every business partnership, there are specific costs associated with bringing a book successfully to market, and we state them very straightforwardly and transparently in our author agreements. These costs could be much higher--and certainly be more stressful and labor-intensive to undertake--for an author with a self-publishing model. Profits are generated once those costs are subtracted from the sales revenue. Hydra and the author split those profits equally from the very first sale.

When we acquire a title in the Hydra program, it is an all-encompassing collaboration. Our authors provide the storytelling, and we at Hydra support their creativity with best-in-class services throughout the publishing process: from dedicated editorial, cover design, copy editing and production, to publicity, digital marketing and social media tools, trade sales, academic and library sales, piracy protection, negotiating and selling of subsidiary rights, as well as access to Random House coop and merchandising programs. Together, we deliver the best science fiction, fantasy and horror books to the widest possible readership, thus giving authors maximum earning potential.

As a last point to the SFWA leadership, my colleagues and I would welcome the opportunity to meet with you at your earliest convenience to discuss the advantages of the Hydra business model, describe the program overall, and respond to any of your expressed concerns. Please let me know a good time for us to set up this meeting.

Many thanks and all the best,
Allison Dobson

Allison R. Dobson
V.P., Digital Publishing Director
Random House Publishing Group
I think we'll have to wait for time to show whether Hydra really represents a lucrative business model for authors (I note RH's careful pairing of "potentially" with "lucrative"). Hydra is speculative in more than just the genre it publishes: it, and digital-only imprints like it, are experiments, with authors as guinea pigs.

I also note that in an email I saw from Random House, ebook setup costs (editing, design, production) were estimated as "usually" amounting to "no more than a few hundred dollars"--so I can't help wondering what level of services authors will actually receive.

In fairness, from what I've heard, Hydra is very willing to negotiate, and some authors seem to have been able to arrange considerably better terms for themselves. (I would love to be more precise, but I don't want to inadvertently identify the people who've contacted me. If you're curious, write to me and I'll tell you.)

I'd welcome the chance to meet with Random House staff to discuss these issues. Hopefully this can be arranged in the near future.

-----------------------------

** While I agree with most of John's points about Hydra's deal terms, I don't agree that life-of-copyright contracts are an automatic red flag. For one thing, they're standard in the publishing industry (and that includes many smaller digital-only publishers). Is this fair? Does the publisher need it? Maybe not. But it's a fact.

For another thing, as long as there's precise reversion language that ensures a book goes out of print when sales fall below a reasonable minimum ("reasonable" being keyed to the publisher's average sales expectations), life-of-copyright doesn't have to be a problem. The publisher does not get to hold your rights indefinitely. When your book stops selling, you can demand reversion and get your rights back. I've done this, so I'm speaking from experience.

I have seen terrible life-of-copyright contracts where reversion was left entirely to the publisher's discretion, or where there was no reversion clause at all. If a life-of-copyright rights grant is not offset by good reversion language, or if the publisher is unwilling to insert it at the author's request, writers absolutely should run away. But in principle, life-of-copyright contracts do not have to be scary.

Monday, March 04, 2013

Law Firm Investigates Author Solutions Inc.

Posted by Victoria Strauss for Writer Beware

The New York law firm of Giskan Solotaroff Anderson & Stewart LLP has opened an investigation of Author Solutions Inc. (ASI), alleging deceptive practices.
Authors using Author Solutions have complained of deceptive practices, including enticing authors to purchase promotional services that are not provided or are worthless, failing to pay royalties, and spamming authors and publishing blogs/sites with promotional material.
They're calling for contact from authors who believe they've been the victims of these and/or other deceptive practices. The contact form is here.

Giskan Solotaroff Anderson & Stewart specializes in, among other things, consumers and small businesses in class actions. Where possible, they enter into contingency fee arrangements--i.e., they take a percentage of the winnings rather than a fee. Given that Author Solutions is now owned by Pearson, there are some deep pockets here, which  may make a lawsuit more feasible than it has been in the past. (To my knowledge, no lawsuit has actually been filed; this is a preliminary investigation only.)

I've blogged about ASI and its questionable practices a good deal over the past few years. For background, here's a selection of my posts:

Pearson Buys Author Solutions (but questions about ASI's business practices remain open--will Pearson address them?)

A Partridge in a Penguin Tree (ASI expands into India).

Archway Publishing: Simon & Schuster Adds a Self-Publishing Division (outsourced to ASI, and it's eye-poppingly expensive).

Fake Jared And His Friends: Author Solutions' Misleading PR Strategies

Democratization or Disinformation? (ASI's misleading "white paper" on independent" publishing).

Posts by others:

Writer and editor Emily Suess is a relentless critic of ASI, and has exposed many of its business practices and collected many complaints from unhappy authors who've used its services.

Mick Rooney of The Independent Publishing Magazine has a long piece on the Giskan Solotaroff investigation and related matters.

Author and blogger David Gaughran deconstructs the ASI empire.