Tag Archive - Business

Implications of the Department of Justice Lawsuit Against Five Major Publishers

April 16, 2012 in Agency, Business, Contracts, Publishing, Steve with 9 Comments

by Steve Laube

As you have heard by now the Department of Justice (DOJ) has leveled a lawsuit against Apple and five major publishers accusing them of conspiring to fix prices. There has been a lot written on the topic with varying degrees of understanding and a wide disparity of conclusions.

Authors are asking what this all means to them. And many are confused about the math involved. A great, and lengthy summary has been brilliantly composed at Shelf-Awareness. Read that article if you do not understand the details of the situation. It is important that every writer grasp the implications because it could affect how books are sold moving forward.

Already, three of the five publisher have agreed to settle without admitting guilt (HarperCollins, Hachette, and Simon and Schuster). And that settlement will take at least 60 days to finalize. This leave MacMillan and Penguin who have vowed to fight the suit. Such a fight could last years.

By the way, Random House was not named in the suit because they did not change their pricing policies until much later and thus cannot be accused of colluding.

At is core, the issue revolves around who gets to set the prices of books, the publisher or the retailer? When the retailer controls the sales price a company like Amazon has, in the past, used their clout to cut prices severely, even to the point of losing money on the sale of the books they sell. Since Amazon is so large and diversified in their products a books-only company like Barnes & Noble or Books-a-Million is at a disadvantage. The DOJ doesn’t care if the retailer of the publisher controls the prices, but they did take offense that five publishers and a major vendor agreed to the same terms at the same time. It has the appearance of collusion.

Years ago when I was in the bookstore business we were constantly being challenged by bargain pricing done at the warehouse clubs on selected titles. They would buy a book that retailed for $20 and with their buying power purchase the book for $10 net from the publisher. Then they would retail the book to the public for $10.88. There were stores in our area that had little purchasing clout and the best price they could get for the same book was at $12.00 net. To match the warehouse club price they would lose money on each sale.  You see the problem?

However

However, many authors do not understand that this “Agency Model,” the lawsuit, and its implications have had little effect on the rest of the publishing industry. While the Big Six comprise a huge portion of the market, they are not the entire market.

Read my previous blog about “Who Owns Whom in Christian Publishing.” The Agency model of selling books to Amazon and iBooks has not applied to the majority of Christian publishers. See that post starting half way down where there is a long list of publishers not owned by any of the Big Six.

Each publisher has had to negotiate their own agreement with Amazon to sell their ebooks and paper books. Unfortunately we are not privy to what those terms are. And Amazon and the publisher work together to set prices in most cases. If they are unable to come to an agreement Amazon has used their weight to pull titles from their site. IPG (Independent Publisher’s Group) in late February refused to renegotiate terms with Amazon. Overnight thousands of IPG books disappeared from the Amazon site. And to this day they have not yet been reinstated. (Read this article for full information.)

But that is an unrelated incident, other than being instructive as to the clout of Amazon. As for what will happen? Kristine Kathryn Rusch quite ably said in her very informative blog, “No one knows.”

Any Questions?

After you have assimilated the information linked above, do you have any questions? I will try to answer as best I can in the comment section below. Or use the green “Ask Us a Question” button to the right to send a private question.

 

News You Can Use – Mar. 20, 2012

March 20, 2012 in News You Can Use with 2 Comments

Why Finish Books – I loved this essay! He had me at the picture of C.S. Lewis…

Why Your Book Isn’t Selling – Suggestions from a book marketing expert.

The Publishing Industry May Not be Falling Apart After All - One author suggests that today’s crisis sounds awfully familiar. And underneath all the talk of seismic changes and Amazon, she has a valid point. If you click all the way through to her original article you will find a “Live Journal” site that is hard to read on-screen.

Free E-book on How to Attract Customers with Twitter – From Hubspot. Must submit registration info to get the free e-book. They offer a number of these papers on a regular basis.

Is Your Facebook Account Part of Your Estate? – Facebook says that if you die your Facebook account must be closed. So all your writing, pictures, etc. will disappear. And they don’t like it if someone else simply uses your password to keep it online. Goes to the heart of what you “own” and do not “own” on the Internet. Read this and plan accordingly!

How One Man Started Writing for “Sports Illustrated” – He worked on his craft for six years before submitting something to an editor.

The Making of the Hunger Games Blockbuster – Whether you like the book or not is beside the point. Read the article to find out how this YA phenomenon grew via word of mouth and intentional marketing. Fascinating.

Why Do I Have to Jump Through Your Hoops?

February 23, 2012 in Agency, Book Proposals, Business, Tamela, Writing with 40 Comments

by Tamela Hancock Murray

Recently, my assistant had a conversation with an author who did not send a complete proposal. The author was referred to our guidelines and gently reminded that we needed more material in order to make an evaluation. But instead of saying “thank you” for the guidance, the author declared they did not have to jump through any hoops, and took the opportunity to aggressively express their complaints about our review process.

What made this all the more frustrating to us is that it happens more often than you’d think.

Why All The Work?

Have you ever worked in an office where you could swear one of your coworkers could find something — anything — wrong with your work so they could get it off their desk and back onto you? Well, that’s not what we are doing when we ask for a proposal. We are not giving you busywork so we can get back to our soap operas and coffee.

By asking for a proposal, we have a way to evaluate you as an author and what we might expect in the way of your career. In turn, we are helping the editor evaluate your work and giving that editor a document they can take to Committee that will answer the Committee’s questions. That proposal needs to be a thorough document, especially in this tough market. The advantage you have with an agent is that we will help you get the proposal in the best shape we can before the editor sees it. We help your proposal stand out among the many others the editor will review. But you have to help us by doing your share. And most authors do. Trust me, I know how hard successful authors work. Everyone down the line appreciates cooperative, hardworking authors.

What If I Don’t Know How to Create One?

Writing a proposal can be scary if you’ve never had to write one. There are so many parts to a great proposal and many can fee inadequate. For instance, some new authors don’t feel they can garner meaningful endorsements because they don’t know anyone “famous.” That’s okay. I have helped many authors with various sections of a proposal. There are ways to pitch a book that can avoid certain areas of inadequacy. Another scary section can be the past sales history of your books. You may be a new author with no sales figures or a mid-list author with modest sales figures. We often have published authors try to skip that section. Unfortunately you cna’t avoid it. Every publisher will ask for that information. But we know that each author has a different past experience in the industry and modest sales can occur for any number of reasons. Fortunately most publishing houses will take this into account when evaluating a new project.

Best Advice I Can Give

The best advice I can give is that if you’re feeling unqualified to write a proposal, don’t let it paralyze you into not submitting. And definitely don’t vent to an agent or editor (or to their assistant). Do the work and give it your best shot. Send the most polished and complete proposal you can along with your fantastic book. An agent will respect the fact you took the time to research the agency’s site and provided all the information you could, to the best of your ability.

We can heartily recommend a couple resources if you cannot attend a writers conference. Michael Hyatt, former CEO of Thomas Nelson Publishers, has an excellent e-book resource called Writing a Winning Book Proposal. Or buy Terry Whalin’s Book Proposals That Sell.

I wish you great success! And I look forward to getting your complete book proposal.

News You Can Use – Feb. 14, 2012

February 14, 2012 in News You Can Use, Steve with 1 Comment

It has begun – The Welcome Assault on Costly Textbooks- But is this the best way to do it? Free online publisher-quality textbooks for five of the country’s most-attended college courses. Funded by big charitable organizations like The Bill & Melinda Gates Foundation. It could change the economic future of some major textbook publishers. I fear the homogenization of Education or the control of what is taught in college Biology class, just because it is free.

Pinterest Boards for Book Lovers – Ten places to try out the latest social network phenomenon.

Five Ways to Maximize the New Changes on Facebook – Confused by yet another change to Facebook? This should help.

Is Self-Publishing a Ponzi Scheme? – Richard Curtis, as usual, is brilliant and insightful. Do think this is out of line? or cutting close to the truth?

Is it Time to Bundle the E-book with the Physical Book in Online Sales? – I asked this question of Hachette 2 1/2 years ago during a Digital Initiatives presentation and was told no. Dennis Johnson of Melville House Publishers discussed the issue with great insight.

Lady Solves Wheel-of-Fortune Puzzle with One Letter - This article shows that it wasn’t luck but years of study and preparation. Sort of like someone thinking they can just sit down and write a whole book in a weekend. It’s easy!

Happy Valentine’s Day!

Valentines' Day is a multi-billion-dollar business. Find out where your money goes in today's GoFigure infographic.
Source:LiveScience

News You Can Use – Feb. 7, 2012

February 7, 2012 in News You Can Use with 9 Comments

Author Says McGraw-Hill Cheats on Royalties - Details of a pending lawsuit.

What is Pinterest? -  The latest craze in Social Media Networks. AuthorMedia shows you the simple steps to sign up and tips on how to use it in the next article below.

Three Ways an Author Can Use Pinterest – Last week an editor told me how she was following a couple of her authors on Pinterest and how much she liked it.

5 Ways to Break Out of the Social Media Doldrums - Well said by Aubre Andrus.

10 Ways to Ensure No One Will Read Your Blog Post – Ali Luke give great insight

How Hard Can it Be to Write a Kids Book? – Sally Lloyd-Jones helps dispel a common myth.

A very cool six minute video envisioning a future technology. Imagine computing being done on glass walls, desks, and even in National Parks. From Corning. By the way, Corning makes the “Gorilla Glass” that you find on the iPad2.

Fresh Formulas

February 2, 2012 in Agency, Branding, Craft, Creativity, Publishing, Romance, Tamela, Trends, Writing with 10 Comments

by Tamela Hancock Murray

Some have a hard time appreciating the talent involved in writing genre fiction. By genre fiction, I mean novels that fall into a defined category such as contemporary romance, historical romance, romantic suspense, or cozy mystery. Many of these novels are published by mass market publishers (like Harlequin) and fit in lines they have formed for the sole purpose of selling the genre.

These are distinguished from Trade fiction where there isn’t necessarily a specific line that has been formed to sell a genre, although there are exceptions to that “rule” like the “Love Finds You” series from Summerside Press. In publisher’s lingo “trade” means a 5 1/2″ by 8 1/2″ trim size and is probably between 80,000 and 100,000 words in length. “Genre” or “category” fiction can mean the 4″ by 6″ trim size (also known as mass market) and between 50,000 words and 70,000 words.

Critics think genre writers churn out story after story with little variation…following a proscribed formula. And while opportunities to be published in genre fiction are more plentiful than trade simply because genre lines publish a greater number of titles (see the statistics incorporated into this blog post), editors are nevertheless highly selective. They must be, because readers are right to be demanding, and genre authors must be dedicated to the craft.

Success

To be successful with a line, stay fresh and new while following the genre’s rules. When thinking of genre fiction, I like to visualize a box that needs to be filled with a story. The rules of the box include a strict word count. If you’re writing for a genre line, be sure to stay with the word count.

Guidelines for plot are concrete. For instance, with romance, the story of the hero and heroine must take precedence over anything else. The romance cannot be overshadowed, for example, by a murder mystery, a setting becoming a character in its own right, or a subplot involving secondary characters. Because of these guidelines, readers can rely on certain types of books to provide them with the stories they expect. In an uncertain world — and the world is always an uncertain place except for God’s enduring love — seeking genre books again and again offers readers comfort along with entertainment.

Twists and Turns

Once the writer learns the rules within the box, then what? Know that editors are looking for fresh ideas within the parameters of the genres they edit. To get an idea of what might work, read books from the line you are targeting. See what themes work. Concentrate on those that capture your imagination.

Interested in history? Consider researching real events that can launch a novel. For contemporary or historical, find a unique obstacle that will confront your characters so the reader has no idea how they can overcome it, and wrap a romance or mystery around it. Then plot and write. The author who stays within the rules of the line, yet comes up with a variation or twist on a beloved theme, is likely to find success and avid readers.

Your turn:

Do you read genre fiction? What are some fresh ideas you have enjoyed seeing in recent books?

Clarification on Sale of Heartsong to Harlequin

January 30, 2012 in Agency, Business, Publishing, Romance, Steve with 5 Comments

by Steve Laube

New information has surfaced regarding the sale of Heartsong to Harlequin.

In my post on Friday I made the assumption that the sale included all the backlist and the currently contracted titles. This was reflected in point #5 in the post.

That is not the case. Harlequin did not buy the backlist or the currently contracted titles. Those will remain the property of Barbour Publishing. Thus future repackaging opportunities remain for those titles. That also includes the Heartsong e-books that Barbour is releasing under the “Truly Yours” banner (also mentioned in #5 in that previous post).

Harlequin bought the brand name and the club mailing list, not the books themselves.

This changes some of the implications for Heartsong authors.

1) Heartsong authors are not suddenly going to become Harlequin authors by virtue of the purchase.

2) Future acquisitions for Heartsong, if there are any, will be handled by Harlequin. New Heartsong acquisitions have been completed for all of 2012.

3) Existing Love Inspired authors will be marketed to the Heartsong direct-mail club members (and vice versa). My assumption is that Harlequin is betting they can increase their Love Inspired direct-mail club membership very quickly.

Check back to see if there are further developments as more details come available.

Barbour Sells Heartsong to Harlequin

January 27, 2012 in Agency, Business, Contracts, Publishing, Steve with 17 Comments

by Steve Laube

Today Barbour Publishing announced they have sold their Heartsong Presents line of inspirational romances to Harlequin.

For those of us who have been wondering about the eventual buyer, this comes as no surprise. We have known they were being sold since last Fall. In December I spoke with Barbour’s president, Tim Martins, and he confirmed that the sale was in its last stages of negotiation but he could not say who the buyer would be. With their Love Inspired lines of Christian romance, suspense, and historical titles and a strong member subscription base Harlequin is well suited to sustain(?) or absorb(?) the Heartsong line for years to come.

Our agency has nearly thirty authors who are writing or have written for Heartsong in the past. We also have over twenty authors who are writing or have written for Harlequin’s Love Inspired. So, for our clients this is a pretty big deal.

There are some questions raised that have answers, and some that don’t.

1) Barbour filled the pipeline for 2012 with 52 new titles. Their Editorial staff has been contracted to manage, edit, and typeset  those properties during the transition to Harlequin. So for the first half of the year, nothing will change. By then we should know what the new acquisition strategy looks like.

2) We have no answers about the future and how these two lines will merge or evolve. And it is useless to speculate. Joan Marlow Golan who is the head of the Love Inspired team is a very sharp and excellent about communicating changes to us agents. Do not write or ask your Barbour editor on Twitter or Facebook or email to ask questions. They are now a contractor for Harlequin and it wouldn’t be fair to them to ask for “insider information” that they cannot or should not share. Instead this is where you rely on your agent for information.

3) Harlequin’s three Love Inspired lines currently releases 14 new titles per month. (Six romance, four suspense, and four historical.) Heartsong, as noted above does four to five per month (52 per year), or one third the output of Harlequin. Adding the two together, with no changes would mean an increase from 168 titles to 220 per year. We would hope that will be the case, but it may not.

4) Existing contracts will be honored as written. I’ve seen numerous publisher sales before and the past contracts remain in force in every case.

(Update 1/27/2012 at 6:30pm EST)

5) Since Heartsong books were not in the retail market the general public will not see anything different. However, recently the backlist Heartsong titles were targeted to be converted to e-b00ks (about 980 of them). Those will roll out in 2012 and would make a ready addition to the strong ebook sales that Harlequin already enjoys. And those e-books will probably be priced at $4.99 each.

6) As for the 3-in-1 or 4-in-1 collections that combined Heartsong books into one volume, we do not know exactly what will happen with that program. These are not the same as the novella collections already in place. I am talking about books like Kansas Home that combined three Heartsong books into one trade paper which was sold into the retail market.

Your Brand is Not a Limitation

January 19, 2012 in Branding, Business, Publishing, Tamela with 26 Comments

by Tamela Hancock Murray

It is All About Expectations

What if you bought a recording from a music group expecting their usual collection of ballads, only to hear guitar anthems? Or what if you picked up a book with a pink cover that promised a love story but ended up reading a novel where hapless and nameless victims suffered gunshot wounds on every page? You’d be disappointed, right? I would be. You don’t want to disappoint readers, so branding has become a consistent topic.

Your Best Friend

Some writers find the concept of branding to be limiting. When they think of branding the TV show “Rawhide”  and Cattle comes to mind.  And despite the awesomeness of such a theme song, they want to keep their options open.

While freedom to explore new avenues is desirable for growth, the fact is, writers need to first establish an audience. And to do that, their work has to be consistent in quality and content. The idea is to become a friend to readers, one they can rely on for certain reading value, whether it is fiction or non-fiction. Think about it — what if you had formed a relationship with a friend who consistently gave great advice from the context of her loving family and marriage. Over the years, you come to rely on her for Wednesday afternoon chats over tea in her cozy breakfast nook, watching birds from a bay window. In return, you might bring over some sugar cookies. You find comfort in her usual appearance — a white t-shirt and jeans, blonde ponytail and cotton-candy-pink lip gloss.

What Happened?

How would you feel if one week you kept your Wednesday appointment but were greeted by a stranger with cropped hair dyed the color of onyx, coal-black lipstick, a newly-pierced eyebrow, wearing black leather? Only this isn’t a stranger. It’s your friend. “How do you like my new look?” she asks. “I was tired of the old look and thought I’d spread my wings. And my husband? I threw him out and he took the kids with him. Oh, and I changed brands of tea. But come on in!” Would you trust her not to have spiked the tea as well as her hair?

Double Identity?

This isn’t a comment on fashion, it is a comment about expectations. This is akin to what happens to readers looking for a certain type of story associated with your name. Sure, you might be a cotton-candy-pink writer with a vampire novel sitting in your files. What with self-publishing, shouldn’t the vampire come out and play? Probably not a good idea. The idea of giving blood is not going to appeal to your audience looking for a sugar fix. If they happen upon the vampire novel, your readers devoted to light romance will be confused and disappointed. They will be looking for their friend. Granted, a very, very select few writers are able to write across genres and be successful at several. And others are skilled at using pen names and creating dual marketing identities. But that takes work and an intentional strategy to market to divergent audiences. For most writers, concentrating on a quality and valued friendship with a devoted audience is reward enough.

Your turn

Who are your favorite writers? And if you had to identify their brand, what would you say it is? (Remember a brand is not a slogan, that is a topic for another day.)

 

 

Deadlines and Taxes

January 16, 2012 in Business, Steve, Writing with 1 Comment

by Steve Laube

Two certainties in the life of a writer. Deadlines and Taxes.

You know what a deadlines is. It has the word “dead” in it for a reason. And intrinsic to the reality of taxes is that April 15th filing deadline.

But what about those taxes?

Many articles appear in early April about taxes when approaching the filing date. But I thought we should explore a couple items now so there won’t be any surprises come April.

First, the obligatory disclaimer. I am not a tax attorney or a tax accountant. I am merely discussing concepts and ideas which you may or may not use in your situation. And, as always, when it comes to your taxes, make sure to consult a professional.

Some of you may roll your eyes and say, “I already know this.” But remember there was a time when you did not. I get many “beginner” questions each year from debut authors who are discovering much of the business side of this industry for the first time.

Keep Good Records

One advantage of the self-employed writer is the ability to deduct certain expenses as they relate to the writing profession. Writers conference fees, writing magazine subscriptions, web site hosting fees, promotional items used to market your book, etc. These are possible deductions, but you must have a record of each expense.

And I mean keep everything. Receipts, ticket stubs, bank statements, check registers, ATM receipts, mileage (when and where and how far). Nowadays a good scanner and smart use of Evernote can put it all in one place.

Now is the time to start trying to recreate your 2011 expenses if you haven’t already done so. Trying to find that receipt on April 14th might be a challenge.

Hobby-Loss Rules

If you are writing as a hobby or for something that only occasionally earns money, then you can only deduct expenses equal to the amount of your revenue. In other words you can’t buy a submarine and claim it was for research for that underwater thriller you’ve been trying to write for years.

But if you have the “intent” to derive a living from your writing you can show a loss (and maybe deduct that submarine!?) Proving intent is something judged case by case. Put it this way, if you show a loss in your writing business for five consecutive years, expect a red flag to appear in the IRS inbox. It is commonly understood that the IRS will accept that you are running a business if your writing work shows a profit in at least three of the last five tax years. But in an audit the IRS can go back many years and determine if your deductions were valid. If disapproved you will end up with a very expensive new tax liability and additional penalties. Here is the official page on the IRS site for their Hobby-Loss Rules.

Separate Your Home from Your Business

As much as possible keep your household income and expenses separate from your income and expenses for writing. It can be as simple as keeping a separate bank account. (This is one way to prove “intent,” see above.) And then keep records separately for the business using Quicken, Mint.com, or a spreadsheet.

If you work out of your home, consider exploring the “home office deduction.” But be careful. If you write occasionally from the home computer and that computer is used by other family members for things other than your writing business, it is likely you will not qualify.

I know of some authors who have a separate phone line (or cell phone) just for their business. That way interviews and publicity inquiries from the Today Show don’t come to the house where your teenager answers the phone and shouts, “Mom! Some dude is on the phone for you!”

Resources

I can recommend the book New Tax Guide for Writers, Artists, Performers and Other Creative People by Peter Jason Riley. This is one of the few annually updated tax guides that helps those in the arts. This 2012 edition is supposed to be available soon.

The other is Carol Topp’s Business Tips and Taxes for Writers. (Amazon link; Kindle link; Direct) It is simple, clear, and specifically intended for the writer.

And last, an excellent book The Money Book for Freelancers, Part-Timers, and the Self-Employed: The Only Personal Finance System for People with Not-So-Regular Jobs by Joseph D’Agnese and Denise Kiernan. It is one of the few books out there that is specifically designed to help those in the arts.

For many of you, numbers are either a toxic topic or the equivalent of hieroglyphics. But take this issue seriously. The writing profession is ultimately a business. Granted a business based in the Creative Arts, but it is still a business. Talk to a qualified tax accountant if you have questions. Never rely on the hearsay of another writers who gives anecdotal information at a writers conference. The IRS won’t accept the excuse that “Sally told me it was okay to write-off my Australian Cruise because I was researching an article about Sydney!”

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