The Economics of Publishing
For those of you interested in the business side of publishing: Susan Beth Pfeffer, a writer whom I admire (and once reviewed in the NYT Book Review), has put up an amazingly forthright blog post on the subject.
Many of you will know that authors are often paid an advance against royalties--that is, the author is paid a certain amount of money in exchange for the rights to publish the book. The author then earns a percentage of each sale (usually between 9 and 12.5 percent for hardcovers and between 5 and 7 percent for paperbacks), and should the author earn more royalties than the advance, the author is paid that extra money. (If the author earns less, she still gets to keep her advance.)
In the six years since I sold Looking for Alaska (my advance was $8,000, and it was generous), I've seen the expectations of first-time authors grow even faster than the YA market has grown. But when you actually look at the numbers, I am increasingly convinced that big advances are bad business for both author and publisher--and more importantly, bad for the book business. (If there is interest, I can explain in boring and excruciating detail what I mean, but I think most of the readers here are book readers more than publishing types.)
Pfeffer's post makes me wonder if the current business model will continue, or whether maybe there might a more equitable solution. Several publishers, for instance, are experimenting with bigger royalty shares in exchange for small--or nonexistent--advances. Is that a better way?
posted by John Green @ Wednesday, June 24, 2009
21 Comments
21 Comments:
Everybody wants those six figure advances that pop up from time to time (most often for YA fantasy) and don't take into consideration the dangers of not earning out and the potential to decimate your career as an author. No one realizes how rare the huge advances are (especially for 1st timers) and most don't appreciate that, even if offered a modest advance, they're still getting published.
Ah. That felt good to say.
Thanks for posting, John. I was curious as to how this works.
~2
There are many areas of publishing (like scholarly) where authors never get paid for their work. I don't see fiction going this far, but I personally would prefer to see a model where authors are paid only if they are successful as that may make publishers more likely to take a chance on new authors and may make authors realize that they need to help with the promotion of their books.
Awesome post. A lot of my friends were unsure how to react when I told them that I'd gotten a modest advance for my first book. They weren't sure whether they should feel bad for me. But the truth is that, as a debut author, I feel like the modest advance has given me a much more realistic view of what publishing is about, and has also lifted a lot of the pressure to perform that a debut author with a six figure advance might have.
I still want to do well, and I'll embarrass myself in every way imaginable to make it happen, but I can do it free from the soul crushing pressure of a large advance.
I wish a lot of aspiring authors could learn to see this. They go for the big money but they don't see the downside. You get $500,000 dollars for a book, and then only sell 10k copies, and you could be looking at the end of your career.
Thanks for sharing this John. As someone who's actively working on her first novel (scary!) this is great information to have.
Personally, I'm of the notion that tiny advances plus larger royalty percents is the equation that works. If I had an agent, it's what I'd want them to negotiate for me.
Here's why: I've always felt that a small advance to help recoup the initial life costs that writing a book consists of is helpful. Because ultimately, I want my book to fail or succeed based on how solid the writing is.
If people LOVE my book I'd want to make more off of it and if people hate it well then it's only fair that I didn't get a huge advance.
I love your publishing posts, I must admit. I've dipped my toes into publishing on a small scale and the more I know, the less likely I am to end up doing something compromising or silly.
I'd always love to hear more about the publishing industry. I know it's an interesting time out there right now. I think a lot of things are going to have to change, and this does sound melodramatic, but I hope I haven't missed out on an era in literature.
To the giant advances to first timers? I say that's a little crazy. First time authors rarely step into the market with the best work of their career (myself definitely included, good god). Reward based on merit, not on a bet of things to come, could be a better choice for everyone.
Can you explain that further in, like, semi-painful detail? I'd like to know more.
There are a lot of factors that go into whether a book sells well or not. Maybe the publisher's art department puts a really ugly or a really one-gender-oriented cover on your book. It won't sell as well as it might have, and the writer will be glad for the advance. As the writer can't control factors like that, an advance of some kind is always going to be a good thing, right?
Ooh, I loved Life as We Knew It. Another great Writers House author. I interned their for two summers and they have SO many great authors - you, her, Blake Nelson...yay!
As someone who is finally in submission mode, I'd say that modest advances and greater royalty shares would be fine with me. It spreads the risk and I would think it also asks an author to continue their commitment to marketing an individual title, even as they're working on the next one. Of course, that means more work for an author.
I'll also be interested to see how this works out now that, at least theoretically, you shouldn't need to warehouse a print run. At least, with technology, it would seem like we could have something approaching "just-in-time" printing.
There is, however, the notion that a publisher is more likely to show commitment to your book in the marketing phase if they have paid a reasonable advance. If there's nothing up-front, they have less to lose and can potentially afford to let the book slide into anonymity. There's a giant gap between nothing and $500,000. I think an advance that allows the author the luxury of eating human (rather than pet) food while writing is the way forward. But, perhaps, not an advance so large that the author lives in fear that they'll bring down the publishing house. What you think?
Thanks so much for linking to this, John. I definitely agree that large advances can be terrible for publishers and for writers. A talented author's career could be crushed having received an enormous advance and getting moderate (heck, even good) returns. I think it's better to start modest and develop a fan base before six-figure deals come rolling in.
I completely disagree. I think $8000 is an extremely disappointing advance, considering you are a career author and wrote quite a good novel. Yes, 500K advances are extravagant, but there's nothing criminal about asking for a living wage. It annoys me that writers are so grateful at being published they don't care about the advance. Fine, to live with the reality of low advances, but don't consider it fair. Many careers have failed, because good writers couldn't keep committing to writing books for too little advances. As for the large advance, I speak from experience that is it life changing, even if you don't earn out. There are always pen names and other chances.
I understand both sides of this issue. But I will say that most of the people who argue against large advances are those who do not have to work a "Day Job" and write on the side... They are people who either make enough to write for a living, or never had to work in the first place (because of a spouse or trust fund or whatever).
For those of us who would love to be able to focus full time on the writing career, but have a mortgage/household that relies on our living wage, the advance can be key to having the freedom to promote our work and still keep to the writing bit.
Dear Anonymous,
Whether you are one person or more, I'll add to the argument for argument's sake. Let's take another industry in which people may work for years, may be incredibly talented, and yet never get "the big break" that leads to fame and fortune: acting. Yes, especially now, there are people who want just the fame and fortune and don't care how they get it. Yet there are a great many who do act and chase the dream because that is what they have to do. It is in them; it is who they are.
So should Dev Patel and Frieda Pinto be disappointed that they were probably paid tiny (in actor's terms) salaries to act in a movie they thought would go straight to video and instead won the Academy Award for Best Picture. Don't you think that not only have their salaries increased but their opportunities, connections, and experiences have also increased. Do you think that J. K. Rowling ever imagined where her life would be now by writing a book about a boy wizard? Why should people be paid a large something for nothing? At the racetrack, it is always the untested that has the longest odds. The rewards can be great if someone takes a chance on them.
Perhaps I just don't understand the publishing business, but I've found in life that you either do what you love because you love it, or go be an accountant. You're allowed to complain, even loudly, about being underpaid, under-appreciated, having not as good a deal as someone else, but you still do it. Even if it costs somewhere - financially, family, colleagues - you do it because it's who you are. The people who truly care about you will be supportive.
For my niece's 16th birthday, I gave her a quote from the book "Illusions: The Adventures of a Reluctant Messiah" by Richard Bach. He said, "Your only obligation in any lifetime is to be true to yourself". I believe that.
For some people that is being a successful Wallstreet broker, or a corporate realtor, or a CEO, or a kindergarten teacher, or a social worker or an accountant. Yet you can still be an actor, or a singer or a writer. The only difference between “us” and “them” is who gets the lucky chance to become known for their work and make it their full-time job.
Please explain in detail your opinion on large advances. I would love to know more about the behind the scenes of publishing
lalibrarylady86,
As someone who has been writing since I could form words, and telling elaborate stories before that, I understand what it means to live your art.
But there is a practical side to being a professional writer... the part where you get paid. And just because someone is, in effect, a professional artist, doesn't mean the business part of the industry goes by the wayside. And just because a writer is concerned about the business side doesn't make him/her a fame whore or greedy.
There are many sides to the advance issue--for instance, some believe that the larger the advance, the more likely it is that the publisher will put their full resources behind that book's promotion, because they want to make up the advance money in sales.
Others say that if the publishers weren't expected to pay out large advances, they might take more risks on debut authors, which would make the literary landscape more rich.
But the reading public is vast and varied. Books with a ton of promotion have failed. Books with almost no promotion have skyrocketed. And there is an even bigger middle ground.
No one knows the magic formula. In 2003, no one knew that sparkling angsty vampire boys would be a sure thing.
But in the meantime, there are many professional writers who don't want to be super famous, or rule the world from atop a giant pile of book awards. They just want to be able to make a living doing what they love.
And for some, a decent-sized advance would go a long way towards allowing them to write more and then make more... until that dream can come true for them.
I think maybe it's just easy for people who aren't required to hold a day job to say that the size of the advance isn't important.
To some of us just starting out... it can be vital.
I'd love to learn more about advances and such. I'm a reader, not a writer, but I'm interested for the same reason I watch those shows on Discovery about how batteries are made: just because I'm not going to make one myself doesn't mean the process isn't fascinating.
For my part, I've always thought of advances as similar to grants for grad school: a sum of money paid out so you can focus on research or writing, rather than having your life sucked out by a job that pays the bills but leaves no time for academics.
Dear Anonymous who addressed me,
First I have to say, I thought the phrase "sparkling angsty vampire boys" was hilarious. Secondly, I come from a family of debaters so please know that my comments are not meant as a personal attack; they are merely a statement of (my) position on an issue.
I freely admit I do not know much about advance payments in publishing. What I was trying to point out is that a job in the arts is rarely a steady and solid paycheck. Thereby the nomenclature “starving artist” and “successful businessman” exist. The idea of patronage is not a new concept which is essential what an advance is. Perhaps Mozart may have composed more had he not had to spend time begging for money. I have a t-shirt with Virginia Woolf's quotation, "A woman must have money and a room of her own if she is to write fiction". Wouldn't everyone want to have a patron who would support them so they can focus on their art? As you said, “No one knows the magic formula”. So who gets the huge wager? Do you bet it all on one number on the roulette wheel or spread out across the table?
I would also like to know what you consider a "decent sized advance". I know that neither I nor most Americans make 6 figure salaries, much less advances. What is wrong with a writer not getting a huge advance but getting a larger share of the royalties? You may have to work a day job (or two). It may take longer to complete your work. You can’t afford a flat screen TV, or an iPod, or take vacations, or buy new clothes, or afford health insurance. Not everybody can. As I tried to point out, you make your choices and if you can’t stand the heat, get out of the kitchen.
I'm not saying there isn't talent out there that should be supported. And it makes me furious that people like Jay Leno and Jeff Foxworthy have children's books published just because of their name/fame. Yet there are grants and fellowships that other people in the arts have to pursue to support themselves financially. Others have taken risks on themselves and their work and had it pay off immensely. George Lucas is the most famous example who, “During the filming of Star Wars, Lucas waived his up-front fee as director and negotiated to own the licensing rights—rights which the studio thought were nearly worthless” (Quotation Source: Wikipedia-George Lucas article). Granted, maybe there isn’t a market for plastic figurines, light sabers, and Halloween costumes from every book written. The point is he took a chance on himself and his art at the risk of being a financial failure and made more money than the studio could ever imagine. Not everyone is a George Lucas. Nor will they ever be.
Write because you love it. Write because you can’t help it. Write because it is who you are.
On a totally less serious note, I would buy plastic figurines of John and Hank. Especially if you could press a button in their backs to make them say phrases like “Don’t Forget To Be Awesome”, “In Your Pants” or “See you tomorrow”.
Dear John,
Sorry for my very long comments on this post. I appreciate your prolific and insightful writings and vlogging and look forward to your further thoughts on this issue.
Alicia
I left a comment on your newer blog post (the continued arguement/discussion) but now I understand about royalties and advances. Thank you!
It's very tough, because while I understand the need for publishing houses to continue to succeed so that we writers have the best possible opportunity to continue doing what we love, I also have to say that earning advances large enough to be able to, if nothing else, work on our books full-time for a few months (especially with a deadline, especially if you don't have a two-income household) would be lovely. We all want to put our best work forth, especially debut books, and that often isn't possible with a demanding dayjob that leaves you exhausted at the end of the day. You can still write, but not as well as you probably could if you could fully immerse yourself in the world of your creation. Honestly, a between $8,000 and $10,000 advance, for a novel with an active deadline, seems fair. It is not exorbitant, and yet allows a person (assuming they live frugally) to take at least a few months away from fulltime work and write. I think it would be in a publisher's best interest to allow this, as it would produce better work in the long run. I agree with not demanding ridiculous advances, but if many picture book illustrators make at least $10,000 a book, it seems only fair that someone writing a novel get the same opportunity/time to hone their story.
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