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8 Things Authors Need to Look for in Their Contracts Today (ETS papers)

The publishing industry is in the middle of a radical transition. The shift from print to electronic media is reshaping the industry, bringing new players to the table, and raising questions and concerns for both new and experienced authors.

At ETS, Bill Mounce presented a paper on “What Every Author Should Know about Electronic Publishing.” he argued that this is a great time to be an author if you stay informed about the industry and the chaining dynamics.


He began by making a few comments about the key players in book publication.

  • Publishers. The best part of this section was the helpful reminder of the risks that publishers take when publishing a new book. In many ways, they put both their money and their reputation on the line every time they publish something. (Unfortunately, Bill didn’t address the question of self-publication. He seems to assume that traditional publication will be the path forward for most Bible/theology authors.) And he of course commented and the shift to electronic publication, which will be the focus of his comments in the next section.
  • Distributors. Two key shifts to be mindful of here. First, there’s the shift from smaller book stores to the big box stores. And then there’s the shift from physical stores to online stores. Both have impacted the industry tremendously.
  • Software. This was one that I hadn’t considers, but Mounce pointed out that distributing books through software programs (e.g. Logos) raises its own issues. Since these books are more likely to come bundled in a package with other books, contracting and licensing is more difficult than with stand-alone products.
  • Authors. Bill’s primary concern here is that authors aren’t staying up on these issues. he also commented that authors need to be aware that publishers don’t always (or even often) make decisions about electronic rights with the authors best interests in mind. And he thinks that software companies are often the worst offenders here.
  • Others. During the Q&A one person commented that he would have liked to hear more about editors and their role. And I’d echo this for agents as well. What do authors need to know about how the changing context has affected them?

8 Things Authors Need to Look for in Their Contracts

Given all of these changes, Mounce identified eight things relative to electronic publication that authors need to be looking for in their contracts.

  • Sub-licensing. This gets a bit complicated, but here’s how I understand it. If you sign a contract with Publisher A, you receive a certain percentage of the book’s sales as your royalty. But, if Publisher A decides to sub-license the book to Publisher B for some reason, Publisher A only receives a portion of the sales price from Publisher B. And, since the author only receives a share of Publisher A’s money, the author gets much less in return for books sold by Publisher B. Mounce’s recommendation, then, is to check sub-licensing clauses very carefully and avoid them if possible.
  • Agency Model. What percentage of the book is kept by the “agency” (e.g. Amazon), and how are the author’s royalties calculated. For example, if Amazon keeps 30% of the book’s sale price, and the author is supposed to get 30% of the royalties, is the author’s share calculated only off the 70% that remains after Amazon’s cut, or is it based on the full sales price? He didn’t indicate that he thought the former model was a problem, only that authors need to know enough to find out what the actual arrangement is.
  • Digital Marketing Plan. He strongly recommended finding out how the publisher intends to use digital marketing (e.g. website, social media) to get the word out about the book. Although the author will need to be highly involved, don’t let the publisher convince you that it’s all the author’s job.
  • Discounting. If the book ever gets offered at a discount, how does this impact your royalties? Do you get paid off the full or discounted price?
  • Electronic Development Costs. Assuming that the book is originally published in print form, who will cover the costs of converting it to an electronic format? Mounce pointed out that this is becoming less of an issue as electronic publishing becomes the norm, but he still recommended looking into it.
  • The Unknown Issue. He skipped the sixth one.
  • Minimum Royalties. I missed some of this section, but the general idea was to pay attention to any “minimum royalty” clauses in your contract and perform some “what if” calculations to see how they might actually impact your take home.

One last note that I found interesting. Mounce pointed out that it’s more important than ever for authors to pay attention to their contracts. Back in the olden days (i.e. up until a few years ago), if a book stopped selling enough copies, it would no longer be cost-efficient for the publisher to keep the book in print. So, the publisher would let the book go “out of print” and the publication rights would be returned to the author. But in the age of electronic and on-demand publication, there’s not really any reason for a publisher to let a book go out of print. This means that the publication rights may not ever be returned to the author. So watch your contract closely.

This was an interesting paper. As I said, I would have liked to hear a bit more about some of the other players in the process. And I’m curious to know what number six was. But otherwise, this was a helpful inside look at a complex industry.