An Alternate View of Royalty-Only Models

Anyone who has read the site in the last week knows I am deeply suspicious of publishers who do not offer advances, so I thought it would be useful for folks to get an alternate view from someone whose opinion I respect.

So: Please meet Evan Gregory, an agent at the Ethan Ellenberg Agency (i.e., the agency I’m with; Evan handles much of my foreign rights work), who offers an informed opinion “In Defense of the Royalty-Only Model for Digital Publication.” Check out what he has to say on the subject. It’s worth your time.

Also, of course, if you comment on his site, please show him the same courtesy (and in some cases, even more courtesy) than you show me here. Thanks.

43 thoughts on “An Alternate View of Royalty-Only Models

  1. I wondered about this on a previous thread (http://whatever.scalzi.com/2013/03/10/new-writers-ebook-publishers-and-the-power-to-negotiate/#comment-449072), and Evan’s thoughts about this being not ideal but not 100% awful for authors reinforce what I was thinking.

    Something he doesn’t address is how niche publishers like Ellora’s Cave, Samhain, and others in the “erotic romance” market put a lot of work into micro-targeting their audience, presumably because some portion of their readers find this insane level of slice-and-dice helpful. It goes way beyond “gay werewolf romance”. Their combination of drop-down menus, keyword searches, and various sorting functions means that if your special interest is (for example) medium-explicit stories under 30,000 words and costing less than $5 with three-way scenes involving two guys and an over-40 mermaid indulging in a particular activity, you can find exactly what you’re looking for.

    I’m not sure this would work in any other genre (are there any others where people develop such focused interests??) but it’s fascinating to me both sociologically and from a business standpoint.

  2. (Following up myself, sorry)

    Actually, I can think of one other area where I’ve seen this kind of micro-targeting enabled by search functionality, though not in quite as much detail: fan fiction archive sites.

  3. Thanks for the link, John. Lot to disagree with there, but it’s certain a more useful case for the defense than “Times are hard! Paradigm shift! SUCK IT, OLD MEDIA INGRATES!”

  4. Susan,

    I think all genre fiction has a bit of specialization that could benefit from the sort of categorization that Ellora’s Cave has on their site. Science fiction has all sorts of easily identifiable sub-genres and tropes that authors mix and match. For example, what if you wanted to read a steampunk book, but you don’t like steampunk that’s not alternate history? Currently you’d have to do guesswork on the cover, and maybe parse the cover copy to make a purchasing decision.

  5. I’ll also note that back when we started BiblioBytes, we had none of the infrastructure that is easily available today. A T1 into your office would take 1-3 months to install and would cost more than your rent. When we started there was no commercial Internet, search engines, or web browsers. We had to write the first programs to process credit card transactions.

    That doesn’t hold true today, of course. But to think that the electronic publisher assumes absolutely no risk in the deal is silly.

    Now, on the other hand, what is risky for a small startup is not what is risky for a multimillion dollar publishing firm. But I can point to the corpses of Putnam New Media, Simon & Schuster Interactive, Random House Living Books, and Voyager to show that having a lot of funds behind you is no guarantee of success either.

  6. As one who has published tech books under royalty-only contracts, I can say that Evan’s post is exactly right. When the niche is small, the royalty is large, the rights are retained by the author, and the publicity and production costs are borne by the publisher, such a contract can be a good deal for a writer.

  7. Cranapia,

    I think that digital imprints should serve parallel to, and in support of, the tried and true “dead tree” publishing model. Physical books will always be more convenient and accessible than digital books for a host of reasons, not the least of which is the established order of proprietary control over devices used for access to digital content. The physical book is in no danger in becoming a fetishized version of a once ubiquitous content delivery system, like say, vinyl records. A book doesn’t require additional equipment (except maybe glasses and a light), it never runs out of batteries, and you can use it just about anywhere, and unlike digital content you actually own it and you don’t require anyone’s permission to resell it. Pretty good for an old block of paper, wouldn’t you say?

  8. Evan:
    I don’t think there are many F&SF readers who are that narrowly focused, but maybe I’m wrong about that. I think it works best with a very formulaic genre, which is just the opposite of what I look for in F&SF.

    I feel like there ought to be a way to make a drinking game out of those sites’ search functions.

  9. Per my previous comment: I’ve published books under both royalty-only and advance models. Only a couple of my books written under an advance model contract have ever sold through the advance (mostly because books about consumer tech have very short shelf-lives, along with that whole ‘reserve-against-return’ deal). Under that model, I get a chunk of change in one go and that’s it. For books I’ve written under royalty-only contracts, I see an initial big month or two of income, and then it quickly tails down to small but steady income. In terms of income to work ratio, I think I’ve done slightly better with my royalty-only books.

  10. Glenn Hauman: Voyager? Multi-million-dollar publishing firm? Well, technically yes, briefly, but I was there, and it was always a shoestring operation—under-capitalized and over-extended. And the reasons for its demise are quite idiosyncratic. (Also one of the coolest places I ever worked.)

  11. I went there to read it, but the page is so poorly formated, that I found it unreadable. Which makes me rather wonder about his experience in the publishing industry.

  12. I think a bigger question is whether or not splitting ebook proceeds with a publisher makes sense regardless of whether you get an advance. I write erotic romance and have friends who’ve signed with most of the major erom publishers (Samhain, Ellora’s, LI, Cleis) as well as those who have gone indie. The latter are finding far more economic success.

  13. If good people use this business model, you can get good results. You can get good results with good people using the worst possible systems. that’s not the problem.

    The problem is this zero-advance model, used by not-so-good people will do nothing but take huge advantage of authors. And zero-advance business model, used by downright evil people, will have people who know nothing about books or the industry or publishing in general start up a website that offers zero-advance deals, put the books on various sites, and let the market tell them which ones are good, at which point the “publisher” pushes the books that sell and ignores those that dont.

    At this point, the “publisher” seems little better than a middle man between the Author and a Print-On-Demand service.

    It is nothing more than evolutionary programming applied to novels. And when you do evolutionary programming, you dont have to know anything about what you’re doing. You just need a large supply of semi-random potential winners, and something to test those potential winners against. A large supply of authors can be acquired if you can sign them with zero-advance. And the thing you test them against is… the market. Ebook publishing can be done with very little money up front, especially when compared to print publishing. And if it sells, you found a winner. If not, you just kick it to the backlist.

    Good people using the zero-advance model won’t do this.

    But the problem is that using a model that requires good-hearted people to produce good outcomes is asking for trouble the moment you acknowledge that there are bad people in the world.

    I saw nothing in Evan Gregory’s post that explains how bad people can’t take this model and abuse the ever-loving crap out of it.

  14. That Mr. Gregory is a class act. Once upon a time, when I was in the throes of agent-hunting (before I decided maybe I needed to re-think my road-to-publication strategy) that guy was in my Top 5. As I recall, he wrote a very amusing rejection letter, too.

    Anyway. I don’t think any author is going to say, “oh, please, don’t give me any of that sexy dirty money.” We all want the seven-figure advance. But for some of us — the people writing books that are outside the market for whatever reason, the books that Big Publishing deems unsaleable — a royalties-only deal makes sense.

    And for the record: I for one would LOVE that kind of micro-niche sorting for books. I’ve been saying for a long time now that somebody needs to find a way to sort and recommend books the way that Netflix recommends movies.

  15. Thanks for posting the link. I appreciate that you are willing o say “hey check out this smart guy and what he says while disagreeing with me and behave on his site”. It’s one of the things that has caused me to become a regular reader of your blog.

  16. Greg,

    Not every book is going to be a winner, and getting kicked to the backlist is going to happen even when your publisher has the best intentions. A long-tail model does have more benefit to the publisher with the tail, than the individual links in that tail, it is true. That’s just business, there’s no morality to that except that which you ascribe to it. Readers will want some books and not others. That decision is not a moral decision either.

    The job of a publisher should be to add value to a written work through editorial guidance, through presentation (cover and interior design) and through marketing (formatting, distributing, cover copy, bookpage copy, sales and promotions). They can’t magically ensure the success of every, or even most published works. I don’t see the evil in having a long tail of titles that sell just enough copies to stay in-print keeping the lights on so that the publisher can continue to acquire newer and better projects.

    Where the evil comes in is when publishers stop being selective, and simply become content aggregators whose aim to make money off of just having an epically long-tail. That’s the Amazon model. Kindle Direct publishing is not a bad deal if you actually have a chance of selling your books to actual readers, it’s not such a great deal if only your friends and family are going to buy pity copies. Amazon doesn’t care whether you’re a serious self-publisher with a marketable project, or a madman whose insane ramblings will only be bought by your therapist to ensure that you aren’t going to bring harm to yourself or anyone else. They’re going to take their pound of flesh, and they’re going to encourage anyone under the sun to sign up for KDP with promises of Konrathian riches to come.

    I don’t however, think a publisher would last very long with that model, because after a while authors would get wise that the other books they’re keeping company with are all written by kooks and purchased exclusively by therapists. Serious authors want to be where the readers are at, and the readers aren’t going to stick around a content-aggregator site that spits out nonsense at them.

  17. I’d love a filtering option for SF&F like there often is for romance (even something as ‘simple’ as All Romance Ebooks’ filter). Not necessarily for only ever reading one type of SF&F, but for finding that one type I’m in the mood to read at the moment.

    Also, I’d love a day when readers and writers of one genre don’t slam (even inadvertently) another. The only thing ‘very formulaic’ about romance is that the story’s main focus is the relationship(s) and it have a happy ever after (or happy for now) ending. Everything else, setting, historical time period, subplot, sex, gender, number of partners, humanoid species, etc. is up for grabs.

  18. What gives me pause is the potential distance between these two statements. From the post:

    by not having to pay advances, they had more money to invest in expanding their business, and greater discretion to acquire works. By not having to worry about recouping an advance and by having limited production costs, not only could these small upstarts publish with greater frequency, but they could also experiment with more niche works and sub-genres, and find readerships that were previously not serviced by the larger publishers.

    …and from Evan Gregory’s comment above:

    The job of a publisher should be to add value to a written work through editorial guidance, through presentation (cover and interior design) and through marketing (formatting, distributing, cover copy, bookpage copy, sales and promotions)

    The publisher’s advance is a very tangible promise that they’re invested in actually doing these things for the books on their list, because they literally are invested. They have to add that value to get their money back. If, as Gregory says, the publisher aren’t worried about recouping their advance, then they’re free not to to any of the value-adding he lists. It’s a throw-shit-at-the-wall model, at least in its worst potential form.

    I can see that the no-advance, skinny-business model might be good for seriously specific niche markets, but surely that kind of focus would be better built into the founding of the publisher, rather than coming out of flailing around with more books just to see what happens. The Ellora’s Cave example seems to suport that. And that business was founded on personal ties between publisher and author, it sounds like.

  19. I like how Evan’s piece puts the no advance model in context against self-publishing, not just against the traditional advance model. Many authors have no interest in dealing with the headaches or upfront costs associated with self-publishing and would be more than happy to sacrifice a smaller share of the royalties in exchange for a publisher covering those upfront costs and providing even a modest amount of marketing support.

    As a freelance editor for Carina Press, one of the non advance pioneers he mentions in his article, I’ve seen some of our authors make much more money in their no advance contract with Carina than with their traditional advance contract with other publishers. I talk further about my own thoughts on this model as a writer over at my blog.

    http://bryonquertermous.com/2013/03/12/i-love-it-when-someone-else-says-what-i-couldnt-figure-out-how-to-say/

  20. amergina:
    Just to be clear, I read both F&SF and specific subgenres of romance for fun and for (paid) review. I don’t write either, or any other sort of fiction. I write obsessively researched non-fiction on historical topics of very limited interest to the general public. This makes me very dull at parties.

    The focus on a relationship and the HEA/HFN ending being definitional for the genre are precisely what I mean by formulaic. What varies are the trappings, not the core plot framework. Pointing this out is hardly a “slam”. The best romances have such well-done trappings that you temporarily forget that you already know the ending, and/or they have substantial enough subplots that there is another resolution one cares about along with the core romance. But there’s not a subgenre of romance in which the lovers don’t actually end up together. It’s a very effective formula for pushing people’s buttons, and the resulting “hit” of emotion is exactly why people read them. Writers’ guidelines at romance publishers make this crystal-clear.

    There are formulaic F&SF novels, but there’s no single formula that defines the genre(s) in the way that romance is defined.

    By way of crossover, I nominated the best romance novel I read last year for the Hugo a few days ago. So did a lot of other people, many of whom would probably say they never read romances. :)

  21. Evan: I don’t however, think a publisher would last very long with that model, because after a while authors would get wise

    the Feds think Bernie Madoff started defrauding investors in 1970. He wasn’t arrested until 2008 when his sons turned him in. Client losses was tens of billions of dollars. Even if people get “wise” about Bernie Madoff, do you think no one will ever try to pull a Ponzi Scheme ever again? Charles Ponzi was pulled his scheme in 1920. The scheme was described in a Charlse Dickens novel in 1844. Sure, people may get wise to teh scammer, but the scam itself has been in operation by someone for at least a century, if not more.

    that the other books they’re keeping company with are all written by kooks

    Evolution doesn’t produce just garbage and kooks. Evolution produced talking primates that landed some primates on the moon. All it took was a large enough source of randomness and some sort of filter to sort the fit from not-fit. Someone who never read a novel in their life and knows nothing about hte industry and has the worst possible intentions, could find a good-selling novel if they just get enough authors to sign up with them. And once they find this one good selling novel, they can point to it and say “look what we can do for you”.

    Some people will look at that result and take it to mean that the publisher caused that success in some sort of a repeatable manner. The publisher will certainly sell that idea. But the reality is that the outcome was purely random and extremely rare on an individual-author basis. And the only “strategy” the publisher employed to achieve success was to sign up anyone who knocked on their door.

  22. Apologies, Susan. Usually when I see “formulaic” thrown around with relation to genre writing (and not just romance), it’s usually in the sense of “Oh, that’s so easy to write,” or “Those books have no inherent worth, unlike [other genre].”

    Yes, you do know the ending of a romance when you start one. (In the same way you know the ending of book that uses the “hero’s journey” trope when you start one.) The art (and the money) is in making the journey interesting. And that’s not so formulaic.

  23. There are a LOT of SF/F readers who really like their specific formulas, be it Supernatural Urban Fantasy, or Manly Man Kicks {Alien/Evil} Ass With His {Starship Fleet|Elf and Dwarf Army}. So the fine granulation Ellora’s Cave has available would actually behoove SF/F publishers to adopt.

    A lot of military SF is as predictable as the monthly Harlequin offerings. Whether the reader wants “Steampunk, But Has to Be Alt-Hist, and No Supernatural Crap”, or “Something Kinda Steampunky, Maybe?” publishers would likely sell more if that information was available. How many books are the various Star Trek novels up to, with your choice of TOS, TNG, DS9, VOY, ENT, reboot, and original-to-print versions? A LOT, that’s how many, and people who read one or two lines religiously would shriek in horror at some others, despite the fact that they’re all recognizably Star Trek.

    I have read a bunch of Ellora’s Cave works, and I appreciate the fact that they have something for everyone. Might be two genetically-enhanced future soldiers having a threesome with an Earth girl; might be a cowboy into heavy BDSM; might be a young couple living in the big city who meet cute at Starbucks. You want it, you got it.

    I’m not surprised they don’t give advances (or Samhain, or other such non-conglomerate-owned houses). But they do package, promote, copy-edit, get cover art that actually bears some resemblance to the content, and all those other publisher things.

    I don’t consider them evil or less-than-worthy markets. If a friend told me she’d sold her Elf-Boy Meets Stripper and they live HEA to Ellora’s Cave, I wouldn’t be all “tsk-tsk, no advance”, I’d congratulate her and make her buy lunch. Ditto if a friend told me he’d sold his Elf-Boy Meets Male Stripper With Whips and Chains HEA, though I’d be less likely to read it.

    So while this crap Random House tried to pull is clearly shenanigans, no-advance can be a good thing. (Carina being a division of Harlequin, I call shenanigans on them too)

  24. Seth,

    A publisher that doesn’t add value to the works it publishes is a bad publisher making inferior products, and people don’t often buy inferior products. Just because a publisher doesn’t have to recoup an advance doesn’t mean that they have less interest in the success of the books they publish.

    Also, pretending that the publishing business as it exists now isn’t essentially run on the spaghetti model (throw it against the wall to see what sticks) is to attribute more foresight to publishers than I think is warranted.

  25. Evan: A publisher that doesn’t add value to the works it publishes is a bad publisher making inferior products, and people don’t often buy inferior products.

    You simply failing to grasp the numbers game that can take place here.

    Say I want to run a scam with stocks. I pick a stock. I send out 256 emails saying I have a great stock-picking strategy, and if they’ll keep it confidential, I’ll share it with them. In the email I tell half the people that the stock will go up tomorrow. I tell the other half the stock will go down tomorrow. Next day, stock goes up. I delete the email addresses of the people I told it would go down. To the half I said it would go up, I pick anohter stock. half of them, I tell it will go up tomorrow. Half I tell it will go down. Next day, stock goes down. I delete the email addresses of the folks I told it would up. I repeat this process until I have 1 person to whom I’ve emailed 8 predictions in a row about stock prices that turned out to be correct. I then offer to give him a prediction for tomorrow for the low price of N dollars.

    How much money have I spent so far? Zero. email is free, email addresses can be scraped from the web.

    How much do I have to know about stocks? Zero. I pick stocks at random. But because email is free, I can make up for my complete lack of understanding of stocks by playing a massive numbers game and running a con.

    After 3 days, there are 64 people I’ve made 3 successful “predictions” for. After 4 days, there are 32 people I’ve made 4 in a row successful stock predictions. After 5 days, there are 16 people I’ve made 5 in a row successful stock predictions. After 6 days, there are 8 people I’ve made 6 in a row successfule “predictions” about stock pricess.

    All it takes is one person to nibble and I’ve made profit. After 8 days, no one bought in? OK. Go find another 256 names and do it again.

    That’s what zero-cost up front makes possible.

    Note that this doesn’t mean anyone with access to free email and stock tickers must become scammers, but if you get an email from someone saying they have a stock-picking strategy, they might be correct many times in a row, and still not know a damn thing about stocks.

    Just because a publisher doesn’t have to recoup an advance doesn’t mean that they have less interest in the success of the books they publish.

    If you want to argue that the No-Advance business model, when used by good people, allows them to them to acquire niche books, then fine. If you want to argue that No-Advance business model allows good people working as small publishers with little cash to operate a successful business, then fine.

    But if you’re going to argue that someone who pays authors zero dollars to acquire 10,000 or 100,000 books is going to be just as interested in the success of those books just as much as someone who pays $10k to acquire a single book, then you’ve lost all credibility.

  26. Greg,

    Sure. If you’re receiving a $10K advance you can be certain that you will be making at least $10K from publishing your book, whereas if you are accepting a royalty only deal your accepting the risk that you can make $0. But as far as the publisher’s interest is concerned, when it comes to selling a book with an advance, they’re only going to invest enough to recoup the advance, and the size of the advance is usually a good indicator of just how much effort they’re going to expend. I would hardly call this a more moral system.

    The advances they offer are determined by a profit-and-loss statement which bases its measures on past performance of similar books. Thus an author writing literary fiction is probably going to receive a relatively low advance (or more likely than not, no advance, considering the publisher blew their whole budget on the celebrity memoir), and receive relatively little attention, whereas a celebrity memoir is going to get a very high advance and receive quite a bit of attention. Is that because the individual celebrity memoir is inherently more interesting than the literary novel, or even necessarily a better product, or even more likely than the literary novel to sell more copies?

    Under a royalty only model, it’s not that the publisher has no interest, it’s that the interest is the same across each title, because the expenses of publishing each title is the same, and the expectation of sales is not tied to an advance that has been proven time and again to be a poor indicator of future sales. Even if the royalty-only publisher is playing a numbers game, it’s only a scaled-up version of what a publisher does anyway, and that is to put out a bunch of stuff and hope one or two are big enough hits to balance out the flops.

  27. @Greg and Evan

    Just because a publisher isn’t paying an advance doesn’t mean they don’t have an investment in the book. I know how much I make as an editor for a no advance house and it ain’t cheap. Neither are the copy editing and cover design and production and other set-up costs. That’s what was so egregious about the Random House deal and why I hate ALL no advance models being lumped in with that one no advance model.

  28. Evan: But as far as the publisher’s interest is concerned, when it comes to selling a book with an advance, they’re only going to invest enough to recoup the advance, and the size of the advance is usually a good indicator of just how much effort they’re going to expend.

    But for some reason, you only apply this logic to Advance-Paying publishers. If I were to apply your logic to No-Advance publishers, then a No-Advance publisher is going to invest NOTHING in the book. And NOTHING is a good indicator of just how much effort they’re going to expend.

    Under a royalty only model, it’s not that the publisher has no interest, it’s that the interest is the same across each title, because the expenses of publishing each title is the same, and the expectation of sales is not tied to an advance

    And suddenly… magic.

    No. All you’re saying is that the No-Advance publisher doesn’t care about any particular book. Which is what I said earlier. They sign up 1000 books, it costs them nothing. And if 1 of them sells well, they make a profit, because it cost them NOTHING to sign up the other 999 books.

    Even if the royalty-only publisher is playing a numbers game, it’s only a scaled-up version of what a publisher does anyway,

    No. It’s not. Because a No-Advance business model allows you to run a publishing company without knowing anything about the industry. If it costs you nothing to acquire books, then you can acquire thousands of books, without even reading them, and whichever one sells well, is where you get your profit.

    It’s like that stock-picking scam. Because I can email thousands of people for free, I could run my stock picking scam using nothing but a computer program and zero understanding of stocks. And if I send out 10,000 emails and get 1 sucker, I’ve made money.

    So, NO, it is NOT a scaled up version of the numbers game that an Advance-Paying publisher plays. And advance paying publisher cannot go fishing for books without knowing something about books and without knowing somehting about the market. They will quickly go out of business. They can’t afford to acquire 10,000 books which sell zero copies.

    A No-Advance publisher CAN afford to pay advances on 10,000 books which sell zero copies because it didn’t COST THEM ANYTHING to acquire those books. A No-Advance publisher CAN IN FACT afford to play a entirely different numbers game.

  29. That last para: A No-Advance publisher CAN afford to pay advances on 10,000 books
    should read: A No-Advance publisher CAN afford to pay no advances on 10,000 books

  30. @Bryon Q:
    Carina wasn’t one of the publishers I looked at when I was doing my informal survey, but within the no-advance “erotic romance” e-book publishers, the three things that struck me as actual positives in the contracts were:

    1. author retains copyright
    2. no rights grab: usually limited to digital publication, sometimes print or audio for publishers who do those, but negotiable
    3. short, finite length of time before automatic rights reversion; usually 2-4 years, one was 7 years, and some contracts actually have early-termination options for the author. No worries about shenanigans with definitions of “out of print” or “copies sold”, which are particularly fuzzy concepts with e-books.

    And while it isn’t a contract term:

    4. The turnaround times were usually lightning fast (under a month) and those that had longer ones generally accepted simultaneous submissions. Having heard about the legendary response times (several years) from some F&SF publishers, that impressed me.

    In the unlikely event I were shopping a novel around and looking at no-advance presses, those four elements would certainly weigh heavily with me. If I correctly understand the current status of their no-advance contract, RH/Hydra and its sister imprints still fail on at least the first three and have other major problems as well. I’d have to be mightily impressed with what else they offer to overlook all that.

    If you’re free to speak about how Carina handles those elements and what their average turnaround time is, I’d be interested to hear.

  31. Thus an author writing literary fiction is probably going to receive a relatively low advance (or more likely than not, no advance, considering the publisher blew their whole budget on the celebrity memoir),

    …wait. How often does that actually happen? That a respectable advance-paying publisher “blows it all on a celebrity memoir” and then tells a lesser-known mainstream author “Sorry, we usually offer advances, but our accounting was so bad this year that we have to make an exception for everyone who isn’t a celebrity”? And then, what, they have no budget leftover for copyediting and cover design and distribution and marketing too? We’re still talking about respectable, worth-submitting-your-manuscript-to publishers? Can you give an example?

    Overall to the topic: In general I’m sympathetic to the idea that smaller presses who can afford less overhead but have a known niche market can make their authors significant pay on a royalties-only contract. I’m not convinced that Random House can justify their royalties-only contract for that reason, even if the rest of their contract met the standard requirements that Susan, just above, lists. They’ve got a pretty sound financial footing. They can afford to pay authors up front.

    And I agree with Greg that if you look at the advance as the limit on how much you can expect a publisher to invest in your book (rather than, as I’m used to doing, a guarantee that they will invest), it remains logically consistent to see a $0 advance the same way. If a $2,000 advance means you can only expect the publisher to market that book until $2,000 has been recouped, how does that logic not lead us to expect no marketing at all on a $0 advance book? (Not that I’m saying royalties-only publishers don’t market their books; I have every respect for Ellora’s Cave. I’m just saying that’s precisely why I don’t buy into this particular interpretation of the advance figure.)

  32. Greg,

    If you think you can make an e-book a best-seller with no formatting, no cover, no editing and no marketing, then I encourage you to try. In the meantime, here on planet Earth, that stuff costs money. Just because the advance isn’t an additional expense doesn’t mean there are no expenses. A publisher still has to recoup those expenses, and thus they would necessarily have to choose works that could sell enough copies to do so. Admittedly, the threshold for recouping is a lot lower for e-books than physical books, especially without the additional expense of an advance. It is, however, not nothing. The costs are certainly substantial enough to limit the number of titles they can afford to take on.

    Any publisher that releases oodles of books with poor formatting, poor covers, minimal to no editing, and minimal to no marketing is not likely going to be very successful.

    Furthermore, since authors are human beings and not mindless deal making automatons, they should be able to evaluate whether they believe a publisher is a good partner for them based on more than just royalty share. If they visit a e-book publisher’s website, or online store, and see that none of the books have covers, most have horrible grammar errors, and they’re all written by crazy people then they can and should run away screaming.

  33. Nicole,

    I was, perhaps being a touch cynical. The publisher wouldn’t offer a deal with no advance, they would just not offer a deal at all, because literary novels are too expensive and too low margin, and because they blew their entire budget on the celebrity memoir anyway. So sorry. Best of luck placing your book elsewhere. That was the idea. I was just being a bit flip about it.

  34. Evan: If you think you can make an e-book a best-seller with no formatting, no cover, no editing and no marketing, then I encourage you to try.

    how the holy hell do you defend this No-Advance business model as allowing niche books, and then change the goal posts to best sellers??? The whole point, according to your own words is that this is for niche markets. Not best sellers. Which means, these people are already making profit by selling extremely low numbers.

    But on a larger point, you’re not being exactly honest in portraying No-Advance versus Normal-Advance publishing. Instead, you keep taking the best-case No-Advance (good people publishing niche books that couldn’t be published any other way) and comparing that to the worst case Normal-Advance paying publisher (a bunch of idiots who blow their wad on a stupid celebrity memoir and cant afford to acquire anything else).

    If there are idiots in the Normal-Advance paying market, then you are being completely unfair and unrealistic to say that the No-Advance market is populated solely by fairy godmothers who grant publishing wishes to down trodden authors who can’t get a break. If Normal-Advance publishers can be stupid and greedy and do something that screws over the authors that submit to them, then the human condition REQUIRES that there will be stupid and greedy people in the No-Advance publishing industry.

    Intentional or not, you’ve been dishonest in your portrayal. And it renders everything you’re saying as suspect.

    People aren’t concerned about good people using No-Advance publishing model. They’re concerned about the greedy people, the stupid people, and conmen, and the scammers using the No-Advance publishing model to fleece authors.

    Furthermore, since authors are human beings and not mindless deal making automatons, they should be able to evaluate whether they believe a publisher is a good partner for them based on more than just royalty share.

    You’re making an argument for laissez-faire publishing.

    It would be not entirely unlike arguing that Ponzi schemes should be legal and just leave it to people to figure out whether the investment broker is legit or a scammer. They’re not mindless automatons, they should be able to evaluate whether they’re a good partner. Right? Except, the Ponzi scheme got its name in 1920. It was described half a century earlier in a Charles Dickens book. Federal investigators think Bernie Madoff started scamming investors in the 1970’s and he wasn’t arrested until decades later, after tens of billions of dollars have been lost. It’s been around for more than a century, and people STILL get snookered by it.

    So, no. This argument doesn’t fly. There are conmen and there are honest people. And the question isn’t whether honest people are stupid. The question is whether conmen are better liars. And the answer is that there are always conmen out there who are better at lying than many people are at detecting a lie.

  35. Thanks for posting the counterpoint…Interesting reading. Also, I’m very sorry, but I must…”Gay Werewolf Romance” is probably one of the best band names I’ve read in a while.

  36. Greg,

    Scammers exist, but they existed before a royalty-only digital publishing. Your point was that a less-than-legitimate publisher could vacuum up a whole bunch of rights, and through the law of averages hit on some success, and exploit that success to further vacuum of rights while providing no value to authors or readers. I was saying, I don’t believe such a numbers game is possible, because in order to attract that many authors in the first place you’d have to have some legitimacy with which to attract them, and in order to have success you’d have to have readers willing to buy the product. Since both those things are hard to come by, even for honest publishers, I don’t think a big time publishing scam is something authors really have to fear.

    More what they have to fear are incompetent publishers. You’re right, not every publisher is equipped to be a publisher, and the royalty only model does lower the barriers for entry for fools and brigands. I don’t, however, see a Bernie Madoff of online publishing being a possibility. There’s just not enough money in publishing for it to be an issue.

    That being said, I don’t think I’m being disingenuous. My goal was to give reasons in favor of the royalty only model, not to delineate every way in which royalty only digital publishing can (and has) gone wrong. For every Ellora’s Cave and Samhain there were a dozen other erotic startups that failed, went insolvent or bankrupt and managed to take some of their author’s royalties with them. This is, of course, not unique to royalty-only digital publishing, lots of crooked and incompetent publishers managed to pay advances and then cheat their authors out royalties earned before the internet even existed. The worst-case scenario is not, however, to lose money owed to you from sales of your books to an incompetent or unscrupulous publisher, it’s to never have the opportunity to publish at all. And I believe broadening the opportunities for new voices to find readerships is worth suffering a few crooks and idiots.

  37. Evan: I don’t believe such a numbers game is possible, because in order to attract that many authors in the first place you’d have to have some legitimacy with which to attract them

    No. Again. No. No. No. No. You don’t need legitimacy if you’re running a con. You just need enough appearance of legitimacy to get by. Federal investigators believe that Bernie Madoff was NEVER a legitimate investment person, that he started scamming back in the 70’s, and that he did so for decades. Madoff had ZERO legitimacy. None. Nada. And yet, he ran scams for decades and burned through tens of billions of dollars of investors’ money.

    You’re ENTIRE ARGUMENT boils down to the premise that it is impossible for scammers to run scams because they “have to have some legitimacy with which to attract” marks. This is ridiculous.

    Are you aware of all the self-publishing scams out there? Do you read Writer Beware at all? People pay fly by night scammers large chunks of money to “self publish” a book, and end up with absolutely nothing to show for it. This has been happening for years.

    You seriously want to argue that these self publishing scammers couldn’t take their con and modify it to run under a “zero advance” publishing model? You seriously want to argue that since these self publishing scammers have zero legitimacy that they couldn’t possibly con anyone????

    The worst-case scenario is not, however, to lose money owed to you from sales of your books to an incompetent or unscrupulous publisher, it’s to never have the opportunity to publish at all.

    No. The worst case is for authors to get scammed, sign the rights to their book over to a publisher for zero advance, never see any copies sold ever, and never be able to get their rights to their own book back so they can take it to a legitimate publisher.

  38. I’m not saying it’s impossible, I’m saying it would be a really difficult, really unlikely, and extremely unprofitable scam in which, in order to steal a significant amount of money you would have to perform all the duties of a publisher in order to make the money in the first place, and then rob it from the back-end royalties. The risk (going to prison for fraud) probably wouldn’t be worth the reward (a piece of the author’s royalties fraudulently obtained) not to mention the late nights spent performing edits and poring over cover designs.

    The publishing scams that exist are mostly about asking the author for money to cover expenses (like Publish America, pretending to play publisher but actually selling publishing “services”). That doesn’t have anything to do with royalty-only. Most publishing fraud is about extracting money from the authors on the front-end, rather than the back-end.

    As an author in a royalty-only model you’re more likely to get screwed because a publisher is incompetent than because they are malicious.

    As for your worst case scenario. A publisher in bankruptcy or breach of contract doesn’t get to hang on to your rights. Worst case scenario is they sell a few books and then disappear and you lose royalties on a couple hundred sales. Which, admittedly, sucks, and sucks a lot, but it probably wouldn’t ruin your career, or invalidate your rights to the work you wrote.

  39. Greg, your entire scam rests on the assumption that the scammer can ID the one stealth bestseller lurking on the slushpile, short of actually publishing it.

    Do you understand what’s wrong?

  40. George: your entire scam rests on the assumption that the scammer can ID the one stealth bestseller

    Wow. You didn’t bother to read the thread at all. (1) It doesn’t have to be a “bestseller” when it’s a model that justifies itself for “niche” books. (2) The publisher doesn’t identify the “bestseller”. With the cost to acquire a book at zero, the model incentivizes them to acquire as many books as possible and let the market inform them which one is the “bestseller”. (done by a t-shirt company here: http://quietbabylon.com/2013/algorithmic-rape-jokes-in-the-library-of-babel/). and (3), the publisher doesn’t have to be out to intentionally scam the author for this to be a horrendously bad idea for authors.

    If the publisher acquires a thousand books for zero-advance, and then the one-thousand-and-one-th book they acquire is a “best-seller”, and if they have limited money to work with (and this model is justified as a way for publishers with little money to get in the market), then they would have much less risk marketing and selling that 1001th best seller rather than spending it on the 1000 unknown, unproven books they acquired. Which means, they’re going to be naturally pushed to acquire as many books as possible for zero-advance, do as little work as possible making them available for sale, letting the market inform them which book is a good seller, and then putting whatever time, energy,and money behind any books that sell well, and basically ignoring the books that don’t sell.

    Do you understand what’s wrong?

    Everything you said.

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