Since last August I've been in negotiations for a book deal with the editor-in-chief of a major publishing house. But I had to abruptly end all further discussions about the project just as we were nearing an agreement.
During a recent conversation about the new book, the editor once again mentioned that he also wanted to release an e-book version of my first novel, Shooters. I reminded him that I didn't want to do that until we were solidly in business together on the new work. After the call, I started thinking about the e-book aspect of the deal again, which we hadn't discussed in many months. At that time he had said e-book rights would be "highly negotiable." But I knew things had been changing rapidly on that front so I sent him an e-mail asking, "What is the current split for e-books?" His response: "The split for e-books is 75% publisher, 25% author." Me: "Do you have that backwards?" E-silence. I sent another note: "I'm serious: was this a typo? Does the publisher actually take 75%?" Him: "Yes. The publisher takes 75%." Me: "This amazes me. No amount of ‘platforming' can justify this. If that's the rate they expect me to accept, I'm going to have to pass. On both projects."
I asked my agent how they could justify this split. He said I'd receive such a large advance that it wouldn't matter for a long time. The advance we were discussing was very good money for a midlist writer. Maybe my decision to walk was foolish, but I had two good reasons for making it. My children. While this deal would have given us a quick infusion of cash, by the time that book "earned out" at a rate of three to one in the publisher's favor in e-book sales, the publisher would have reaped a small fortune, far more than the time and money it would have invested in the project. From that point on, the split would have seemed even more ridiculous. I see it as a permanent 75% tax on a piece of work that generates income with almost no expense after the initial development and setup charges. This deal could haunt my family long after I was gone.
When Amazon sells the Kindle edition of a book for $10, it takes 30% off the top, leaving the publisher $7. The publisher's take is 75% of this: $5.25, leaving the writer $1.75 (then the writer pays his agents; in my case that's 20%). This is all without the traditional publishing risks of printing and shipping books to bookstores and sharing the revenues with them, to say nothing of the dreaded returns.
Now, let's say the publisher wants one of your old books for an e-book and digitizes it. The development costs of doing this are far less than that of editing, publishing, and printing a new book. By the time your book has earned you $10,000 in e-book royalties, the publisher has made $30,000. And what are its contributions? A "platform"? Publicity? We've all seen how well publishers promote midlist books. Why should things change in this new e-world?
This model can't hold. Bestselling writers are already negotiating better terms. In the meantime many midlist writers are going to be seduced by new interest from publishers. I think there will be a tidal wave of cheap purchases by houses hoping to tie up as much material as possible at these usury rates. What will that "platform" get you if you're just another name in a massive list fighting for attention? You will have handed in your work cheap, with no way of getting the rights back. E-books don't go out of print. If you don't fight for time limits, your work will be lost to you. Permanently.
This is not for me. So I'm walking away from a potential publishing deal and joining the ranks of the self-published. This is a huge gamble for someone in my position. But I can't sign away my financial legacy to my children in this fashion.
An announcement like this won't make much difference in the grand scheme of things, but perhaps it will help a few others who are considering similar deals. The fact that a writer in my position resisted the temptation of good money and a traditional publishing deal should give you an indication of how outrageous some of us consider the current "industry standard" e-book split. This is how a revolution begins. One disgruntled citizen at a time.