The dispute that erupted last week over a change in Simon & Schuster's contracts permitting the publisher to retain rights to a book even if the title remains only in electronic form has its origins in the 1990s, when, with the emergence of e-books, print-on-demand and CD-ROMs, the value of electronic rights first came to the forefront. Until that point, the issue of who owned electronic rights was not addressed in most contracts, and the question of when rights reverted to an author was simple to determine. But with technology allowing books to stay in print forever—even if only as an electronic file—publishers and agents began fighting over when a book could be considered out of print. Under the compromise that was reached, the parties agreed that if e-book or POD sales fell below a minimum threshold—usually around 150 copies annually—the book would be declared out of print and the rights given back to the author. It is the elimination of that minimum number that has triggered the current dispute.

S&S has defended its action as one that is necessary if the company is to be able to exploit what it sees as a growing market for POD titles. S&S president Jack Romanos has said that of all the electronic publishing opportunities that exist, the most likely one to develop into a viable market in the near term is POD, and the company is making significant investments in the area. As it moves forward, S&S wants to ensure it controls the files that can be turned into POD titles. “We are embracing print-on-demand technology as an unprecedented opportunity for authors and publishers to keep books alive and available and selling in the marketplace in a way that may not have been previously possible for many authors,” explained spokesperson Adam Rothberg.

Agents and authors, however, see S&S's action as a reversal of longstanding industry practices, and one that was taken with only a limited amount of discussion. “They are rewriting the rules and saying rights will never revert back,” said Brian DeFiore, head of DeFiore and Company. Writers House's Simon Lipskar said the changes, which he has not yet seen in a new contract, move S&S contracts in the wrong direction, and that Writers House “will not be comfortable recommending to our clients that this change is good for them in any way.”

One of the major issues for authors, said Authors Guild executive director Paul Aiken, is how aggressively publishers will promote titles that exist only in databases. He called the S&S action “electronic warehousing of rights,” a term also used by DeFiore. Authors Guild president Roy Blount Jr. said a publisher “is meant to publish, to get there and sell our books. A publishing house is not supposed to be a place where our books are permanently squirreled away.”

DeFiore, as well as other agents, also argue that the S&S policy makes it impossible to sell books to S&S under the same terms as other publishers since they are taking an extra grant of rights. “All agents will think long and hard about selling on the same terms to Simon & Schuster, since they are asking for something no one else has,” DeFiore said. S&S's willingness to talk about the reversion issue on a case-by-case basis didn't provide much comfort to agents, since the policy would most likely favor only major authors. Georges Borchardt, head of the Borchardt Agency, said the move has the potential to create a two-tiered system wherein big authors would get a decent contract and others would not.