Friday, April 22, 2011

Are Big Six Publishers Stealing Royalties?


Kristine Kathryn Rusch says the answer may be yes, if her royalty statements are anything to judge by. She writes:

I had looked at my royalty statements from a Big Six publisher, and could not believe the e-book number. It wasn’t in the realm of reality, particularly given the sales of novellas in the same series that I had put up on Kindle myself. According to all the information I had access to, the novellas sold fewer copies than the traditionally published e-book. The royalty statement, however, indicated that my indie e-books had outsold the traditionally published one ten times over.
I knew that wasn’t possible, and started researching the numbers behind the scenes with lawyers, accountants, agents, writers, and other friends inside the publishing industry. I learned that I wasn’t seeing something unique to me: I was seeing an industry-wide problem that no one was talking about.

That is what Kristine Rusch shared in her April 13th blog post. In her April 20th post Kristine Rusch announced that other traditionally published writers had read her blog, checked their own numbers, and told her that they had found the same thing. Kristine Rusch concluded that,

Apparently, some of the Big Six publishers are significantly underreporting the actual number of e-books sold on writers’ royalty statements.

Wow! But that's not all.

I heard from dozens upon dozens of traditionally published writers last week, and to a person without exception, they had all looked at their royalty statements and found discrepancies like the ones I found. …
Because of my blog post, at least a dozen writers sat down with numbers and calculators in hand. These writers compared the sales of their self-published e-book titles to the sales of their traditionally published e-book titles, and found startling discrepancies. Even adjusting for price differences (Big Six e-books were priced higher than the self-published books), these writers discovered that their Big Six publishers reported e-book sales of one-tenth to one-one-hundredth of their indie-published titles.
Some of these writers are bestsellers. Their bestselling frontlist novels (released in the past year)—with full advertising and company wide support—sold significantly fewer copies than their self-published e-books, books that had been out for years, books that had no promotion at all.

I say again: Wow! I am not a traditionally published author, but, if I was, I would be concerned. It is mind-boggling that some writers discovered that their Big Six publishers reported e-book sales of one-one-hundredth of their indie-published titles. One-one-hundredth!

If the royalty statements Kristine Rusch mentions are incorrect and publishers are withholding significant amounts of royalties from authors, then authors have been cheated out of a lot of money, especially if this has been going on for some time.

Let me play devils advocate for a moment. What if the royalty statements are correct? Independently published titles generally sell for much less than those published by the Big Six. Generally an ebook published by one of the Big Six is priced around $10 while a title from an independent author usually sells for under $5, usually well under $5. Speaking for myself, most of the ebooks I have bought have been under $3. That means that I can afford to buy about three times as many independently published ebooks as those that have been traditionally published.

Of course, that still wouldn't account for those cases where where the reported sales of traditional ebooks was one-one-hundredth of the independently published ones.

I'm looking forward to Kristine Rusch's next blog post about this. Stay tuned.

Links:
Kristine Kathryn Rusch's April 13th post
Kristine Kathryn Rusch's April 20th post

4 comments:

  1. I read Kris's blogs too and couldn't believe it! Scary!

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  2. Yes, I was surprised by Kris's last few posts, I had no idea that so many agents and publishers were dishonest -- I guess that shows how naive I was, and likely still am. I am very thankful that Kris and Dean care about educating other writers.

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  3. They actually have royalty bounty hunters, exclusively for authors. However, the places where they're most needed have likely covered their tracks. I have a handful of provable stories to tell, and a suitcase of suspicions. I'm writing though, because I'm looking for writers interested (at no cost at all) in standing up for their right to decent e-book and app royalty rates. I'm a bestselling author, 18 books published with traditional publishers, many of them bestsellers and now regular backlist bestsellers. I'm happy to rock the boat and I have an idea about how to do it. Screenplay writers got their digital royalties fixed (reason for their last strike). Musicians got what was coming to them. Authors -- are you out there? It's our turn too. You can reach me at MelodyBeattie.com/blog -- make a comment on any blog, and I'll read it. I'm talking about acting quickly, for no money, but I do need people serious, dedicated, and willing to stand up for what we have coming. Thanks -- and thanks for the story. Best kept secret in writer's town.

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