Being treated like royalty

I had my first book come out in 1999. I'm on 13 now, with number 14 in press. You'd think by now I'd have learned, but I think it's defensive memory - like marathon runners managing to forget the exhaustion and the pain and remember the glory and sense of achievement. Or parents planning on a second child and managing to forget the birth part, the diapers, sleepless nights and tantrums of the first... Just because I have been re-reminded of it and its something you need to know as a new writer, let me talk a bit about the reality of how out of touch the writer is with actuality, of your only real tool to know how you're doing: royalty statements.

These arrive. Mostly. Well, that depends on your publisher. With Baen mine arrive. With others... maybe. I've yet to see a single royalty statement for my short fiction, and I have sold 25 stories. I don't expect them to make money -- but I'd finding knowing how (and where) they sold valuable. Anyway: If you get a royalty statement really have no way of knowing if they reflect truth or creative fiction. I know one author (at a different publisher ) whose e-sales are clearly creative fiction, because she knows more people who have bought it than she's been paid for. And very small the numbers of sales on more than one book are precisely the same on another - statistically improbable.. You can of course demand an accounting -- but you'll never sell another book, and if you're wrong and the flaw does not exceed $2000 IIRC, it will be expensive, as you pay for it. So it never happens. I blame Norman Spinrad for this sorry state of affairs - but that's a long story for another time. If it hadn't been for Spinrad's action, the industry would have been healthier financially, and far weaker than it is now. I would also probably not have been published. You can -- if you evade the obstacles the big publishing houses made Bookscan put in your way (ever wonder why?) get the Bookscan figures. These however are very much less complete than your publisher's records and don't include every sale (I believe they exclude Amazon, and Indies and many stores not in a few main centres). As they estimate too apparently, they can exceed the numbers on your royalty statement (if for example you sell OK in New York and other major cities, but barely sell a copy in the rest of the US.) Of course it is entirely possible that the dark suspicions in every author's mind are mere paranoia, like the conviction that e-piracy stole all your sales.

But dear future writer, the saga goes on. You see, royalty statements only cover a complete six month reporting period. - Jan-June, July-December. So if your book comes out 30 December, two days later you are at the start to a complete 6 months and in theory you should get your royalty statement in September (in practice December). However if your book comes out on 3 January... your complete 6 months only starts in July-December. So in theory you would get that statement in March. Only in practice the statement will be a further 2-3 months late. So in other words, if your book came out 3 January 2009... you might only hear how it has done, and get any income from it early July 2010.

There are good historical reasons for most of this, and this delay is the origin of advances which are the bane of every publishing house's existence. Advances -- seeing as the landlord and the power company and the grocer take a similarly dim view to authors to waiting 18 months to be paid, are what most of us end up living on. They are an advance on royalty income and are typically paid - for books sold on proposal half on signing, half on turn in, or for multiple book sales 1/3 on signing and 2/3 on turn in, or latterly 1/3 signing, 1/3 turn in, and 1/3 on publication. A good editor once told me they aim at 2/3 of what they think a book will earn, and a good agent told me he aims for as much as a book will earn.

Er. Do you see the flaw in this? As this is all pure thumb-suck as to how well a book -- especially on proposal -- will do, and getting it very wrong (even if the book does much better than expected) reflects badly on the editor - because that's his job - to estimate it right, the publisher's staff have a vested interest in seeing it is nearly right. They have various tools to do this -- firstly their instincts, secondly those very accurate Nielsen Bookscan figures, and thirdly their company's clout in marketing, and distribution and retail space. And next time they buy from the same author, they have the figures resulting from using these tools... So the only ‘real' factor is the editor's instinct. In some cases that is good - Campbell, Jim Baen for examples -- but let's be honest here - it's a big, complex world, and even the very best get it wrong sometimes. Still, that's how it works and this is why (besides wanting money or needing it to live on) authors and agents try for as high an advance as possible. Which, of course skews the system further and forces the publisher to carry considerable debt...

It would be to everyone's advantage if advances became history. Well, certain editors who enjoyed the power of bestowing them, and certain authors who enjoyed the ‘push' that a huge advance gave to a mediocre to poor book, wouldn't like it. But publishers, their shareholders, readers and most authors would benefit.

Only we STILL have the lag phase, between proposal and payment, and the very long gaps in any author's income, and the uncertainty -- so most authors would not be prepared to let a publisher have their books without an advance, because if they did, the publisher could simply use the saving to give more to Joe or Fred in terms of push. Quite frankly there isn't a lot of trust out there, a situation fostered by all the secrecy.

The answer obviously is to do away with the lag phase, and to make sure that authors knew they were getting an equal chance (or reasonable chance) to succeed. Now, as I said, there are good historical reasons for the lag -- some which still exist for paper. Firstly, keeping track of a physical inventory was not easy or quick. Basically a stock count was the only way to really be totally sure. And every six months was pretty reasonable for that. Of course computerisation has improved this vastly and there really is no reason why a publisher cannot know fairly precisely what they've shipped and what they've got back on a day-by-day basis. Some will tell you, some will tell you if asked, and some just won't. Secondly, retailers had a three-month payment window. The publisher needed at least 4-5 months to be sure he'd actually got the money out of them. Thirdly sheer physical distribution - by sea for eg, could add months onto the time for both sales AND returns. Fourthly the issue of returns and the complexity this added onto calculations of royalties. Finally, the authors were costing the publisher interest charges on the advance. It made sense therefore to sit on/use the cash for as long as possible.

Of course all of the above falls apart in an e-book environment. The publisher and the retailer know immediately how much they have sold (and there is no reason the author and readers shouldn't know too), there are no ‘in distribution' copies, no returns, and no reason (as you are not holding physical stock you have to pay for before sale) to delay payment. And if authors - particularly those with work ready to sell - got paid say... monthly (to save on transfer costs), there is no need for advances, and an electronic retailer has as much e-space for Joe Neverheardofim as for Fred Bigname, and both have the same number of copies (ie as many as any reader wants) on their shelf.

It's a very attractive proposition for authors (the idea of a predictable income - even if it's only predictable day to day by tracking it - paid reliably on a predictable day every month - when bills are monthly is almost intoxicatingly lovely, compared to now), and for publishers, as they escape advances _and_ get reliable sales figures on which authors really sell well (without the GIGO input of bookscan, distribution, marketing and retail space) - which should make them make more money.
Maybe it is less attractive for retail...

Can anyone see any holes in it?