After being hoodwinked by faux memoirists the likes of Margaret Seltzer and James Frey and following a less than profitable business model created sometime during the Stone Age, the publishing industry, or rather a member of the industry, has decided to do something smart, for once. HarpersCollins Publishing announced the formation of a new division that will offer writers profit-sharing in lieu of fat bonuses a.k.a. “advances” on future sales According to an article in the New York Times, the deal will go something like this:
…the new group, which will initially publish just 25 titles a year, would offer “low or no advances.” Mr. [Robert S.] Miller, who was most recently president of Hyperion, said he hoped to offer authors a 50-50 split of profits. Typically, authors earn royalties of 15 percent of profits after they have paid off their advances. Many authors never earn royalties.
I never understood the concept of paying six-figure (and up) advances to authors when it has been proven time and again that doing so is unprofitable. Another arcane and money draining practice is that of allowing booksellers to return unsold books to wholesalers/distributors who, then, return those books to the publishers who have to incur the cost of shipping to and from the aforementioned entities. At the new unit, “Mr. Miller said the publishers could share with authors any savings from eliminating returns. A spokeswoman for Barnes & Noble declined to comment on HarperCollins’ plans.”
The execs at Barnes and Noble must be having a 80 lb. baby over this one. Bookstores have banked on having their shelves filled without having to worry about whether or not the books they order sell through. I can foresee authors demanding that only a reasonable number of books be shipped to stores. What do I mean by reasonable? An amount that they can almost be assured will sell. If book publishers really want to do something really smart, it should consider making the booksellers and wholesalers pay cost of shipping the returns. What company allows buyers to order as many goods as their little hearts desire and return them just because they didn’t sell or because they are trying to make room on their shelves for the next new thing? Trust me, this foolishness is unique to this industry. No wonder it is suffering financially.
With the creation of this new unit with the changes it hopes to institute, there may be hope for the survival, if not the profitability, of the long slumbering giant known as the publishing industry.