A couple of weeks back, SFWA placed Night Shade Books on probation for a year, after authors who were having problems with the publisher contacted SFWA for help. What that means for hopeful authors is that we can't use novels published by them as credit for SFWA membership if we are bought in the next 12 months.
What it means for the industry as a whole, well... It shows that at least with smaller publishers, SFWA has teeth. The list of SFWA-credited publishers is more or less the 'default' list of legitimate science fiction and fantasy publishers. That doesn't mean that those who aren't on the list aren't legitimate, but it does mean an author who's talking to someone else could be looking at a much higher risk of problems ranging from late communication to outright fraud.
Those of you who know the industry may stop laughing hysterically now. I did not say there was no risk with the accepted publishers, merely that it is lower. The simple fact is that a closed system is always vulnerable to abuse, and while authors have no access to sales figures (however accurate they may or may not be) from any source other than their publisher, while distribution in the USA is concentrated into an effective monopoly and the publishing houses themselves are almost all owned by one of a handful of mega-conglomerates, authors will get screwed. It doesn't help that the people who choose which books to publish have less business nous than your average rock.
So, back to Night Shade. After months of putting off agents and lawyers, the SFWA penalty induced a fulsome apology. Perhaps not surprisingly, there is a certain amount of cynicism about the timing of the apology.
What is tragic is that good faith - that is, believing Night Shade's assurances they had the e-rights - has smeared Baen's Webscriptions as well: the author of Mall of Cthulhu (a book I enjoyed reading) not unnaturally accused Baen of being complicit. He hasn't posted anything - yet - to say that Baen has apologized and taken action (they have - there have been questions on the Baen message boards asking why the book is no longer available), and a reader would have to check through the comments to his posts to learn that Baen took any action at all. The guilt by association is still there.
It's a mess, isn't it? But it gets worse...
You see, Night Shade is different from the rest in exactly one regard. They got caught. Listening to authors at cons - the unofficial chats you can't help hearing when you sit down to rest and you're not all that noticeable - is quite the eye-opener. I'd be surprised if there are many authors who actually believe the numbers in their royalty statements. There are complaints about having to get ebooks taken down from multiple sites, multiple times, but never seeing a penny in royalties from them. About signing more copies of a book in a couple of hours than the royalty statement says sold in three months. About discovering a book is a best seller in a foreign country - when the author had never known the book was translated. Worse, I've heard a lot of authors complaining that they can't actually do anything about this because if they do, no-one will buy them again.
And yes, that happens even to bestsellers. I can think of several authors who had a lot of books on shelves and then suddenly vanished. Overnight, as it were. You've got to be in the Stephen King league to be 'safe', and by then, well... You're generally too busy writing to want to waste time and money going after the industry's lax accounting practices and many other failures.
So the problems lumber on and accumulate until...
What? Sooner or later something will give. The question is what, and when. The answer? I have no idea.