"Completely negative and pessimistic"

I recently read a manuscript that I loved and offered the author our contract which the author then submitted to the Authors Guild for review. The author wrote back to say that the response was "completely negative and pessimistic." In light of this, the author, although still enthusiastic, understandably had a few questions for me. Here they are, along with my response.

Dear _________,

Thank you for your enthusiasm in the face of the "completely negative and pessimistic" response of your advisers. These are all good questions and I want to give you a substantial response. Before I do, I'd like to establish a context. The ability to print small quantities of books, aka "short run" or "print-on-demand" or POD, has long been associated with so-called vanity presses and other self-publishing operations that offer a menu of fee-based services. They are all disparaged by the publishing establishment. While namelos also takes advantage of print-on-demand technology and, in one of our divisions, offer services for a fee, we are based on a different, hybrid business model and have a somewhat better reputation. Ironically, I faced the same attitude from the establishment when I launched Front Street, which, at the time, was as radical a business model as namelos is today. The skepticism implicit in the response to our contract is understandable but, to my mind, lamentable because it ignores the revolution taking place in the publishing industry right now. If authors can find a traditional publisher, that's great. If they can't, the skeptics seem to feel those authors are just plain out of luck. namelos is our attempt to create a viable alternative that, looking forward, accommodates the evolution of publishing and offers competitive terms.

On that note, I'll take your questions in order:

(1) Could we limit the contract to a term of two or three years after which time it can be renewed or terminated? I have read that the kind of termination provision that is found in other POD contracts allows the author to terminate after giving “notice.”


namelos is a publisher, not a manufacturer or a vanity press. We are making an investment in the author and in the book. We need to recover that investment and, hopefully, make a profit. If we successfully develop and publish the book only to have the author terminate the contract when a better offer comes along, we'll go out of business in very short order. Therefore, we are not prepared to reduce the term of the license or allow it to be terminated on "notice". The contract includes a clause specifying that sales of a certain level need to be achieved to keep the contract valid. Incidentally, this is increasingly incorporated in trade publishing contracts now that print-on-demand technology has made the old “out of print” clauses irrelevant.

(2) A few POD books have received positive attention and subsequently a traditional publisher has acquired them. Could this contract allow for the acquisition of “hard copy-traditional” rights by another publisher? Would you see this as a plus in that hard copy would support electronic sales rather than compete?

The contract already allows for the licensing of print rights to another publisher, and we are certainly open to that option. We will split the proceeds of any such license on the same basis, 50/50, that we split any and all profit. We believe that hardcover, paperback, and ebook sales are critical segments of the market moving forward. That is why we are publishing the books we originate in all three formats simultaneously.

(3) Most of the concerns about POD publishers involve marketing and promotion matters. What is your experience so far? Are bookstores ordering copies of POD books to have on hand even though unsold copies cannot be returned to the publisher for a full refund? Are reviewers accepting POD books? Do they require/prefer a “traditional” or POD copy? If so, will that be at my expense as author? Both of us want to attract readers. How will they learn about my book if it is not available in bookstores or reviewed by major reviewers? Although I do understand that you are sending copies to a selection of places. Are they accepting them for review?

We have spoken to the editors of the major review journals. They have agreed to consider our books for review (nobody will ever guarantee that they will review a book, only that they will consider reviewing it). I am pleased to say that they did this in spite of implicit and, for some, explicit restrictions, based on our reputation for publishing high quality books and, presumably, the recognition that things are changing. I am confident our books will be reviewed. We have provided reviewers with print copies unless they specifically request electronic copies. I anticipate more and more will request ebooks in the future.

Our first title has an official publication date of April 1, 2010, so we'll know pretty soon if my confidence is well placed. Our books are carried by Amazon, Barnes & Noble, Ingram, Baker & Taylor, etc. and are listed in the Bowker databases, including Books in Print. In addition, we will use the marketing techniques we have used over the years at Front Street and elsewhere, adapted to and incorporating the new opportunities provided by the internet. In short, we will market our books the same way everybody markets their books.

Incidentally, most publishers send advance reading copies (ARCs) to reviewers. These ARCs are virtually all manufactured using short run, i.e. print-on-demand, technology. Relatively few people can tell the difference between a print-on-demand book and a book printed using traditional offset printing.

In all likelihood bookstores will not stock copies of our books because they are non-returnable. Most will only order our titles when a customer requests it. The bookstore model is in transition and I think in the future there will be more ways for booksellers to work with electronic and non-returnable items. A point to consider is that bookstores stock very few hardcover juvenile novels, and those are almost exclusively by brand name authors or classics.

(4) All costs of editing, producing and marketing this book are mine – or 50% mine? I have no control over what those costs will be. In other words, it appears that I will bear a significant part of the costs of production. This isn't standard practice in other contracts I have seen. I would like to have some idea what those costs are projected to be and if they exceed a certain amount, could we agree that I be consulted or the costs shared?

Answer below.

(5) If you don't sell enough books to make up for those expenses, do they become your loss? Or would I be required to pay Namelos the balance?


namelos will invest the cash required to publish the books. The author will incur no out-of-pocket cash expenses except for books they choose to purchase at the manufacturing (plus shipping) cost. When we start to sell books or license rights and there is income, we will recover the direct costs incurred by namelos first, then we split anything above and beyond that. Authors will receive itemized statements of expenses, which will only be book specific, i.e. not including any overhead charge. (To date, these "pre-publication" or "fixed" costs are running in the $2500-$3,500 range. I fully expect they will increase.) If we never recover those costs, the author will not have to pay anything. namelos will take the loss. We will consult with authors on extraordinary expenses—this is a partnership— but, because we will incur the risk, we reserve the right to make the publishing decisions. So, to answer your question, yes, half of the expenses will come out of your share of revenues, but you will receive a much higher than traditional share of profits once those costs are recovered. All publishers build recovery of costs into their budgets.

(6) What are the advantages for Namelos to acquire rights in all languages and for all countries? Does the phrase “dramatic and non-dramatic visual…” refer to audio books? Movie or video rights?


namelos is asking for the cluster of rights traditionally assigned to a publisher. We have long term relationships with a great many publishers, domestic and foreign, as well as with an array of companies that license other subsidiary rights. If there are specific subsidiary rights that an author would like to retain, e.g. dramatic rights (i.e. "movie and video"), we can discuss what they are. The question you will want to ask yourself is, if you retain them, how will you exploit them?

I hope I have answered your questions. namelos is a new thing and all I can guarantee is that you will get our best efforts to publish your book successfully. I regret that your advisers are so negative and skeptical and I certainly don’t want to try to convince you to participate in a venture that makes you feel anything but excited. If I didn't think your book is very good, I wouldn't offer to publish it. Therefore, I would be surprised if you couldn’t find a traditional publishing house to take it on. If you choose to go that route, I wish you the very best of luck and every success.

Sincerely,

Stephen Roxburgh
President & Publisher
namelos llc