Once upon a time, in the 1970s, there was a somewhat subversive sitcom concerning a rather bigoted factory worker named Archie Bunker, his dingbat wife, and his semiintellectual — but meatheaded — daughter and son-in-law. One particular episode involved a strike by Arch and the guys, at the end of which they got a small raise. After Arch left the room in the last scene proclaiming victory, said meatheaded son-in-law pointed out that even though they got a raise, the unionized workers would end up effectively earning less because the raise was less than inflation.
I feel like that's what just happened to authors regarding the awful contracts Random House tried to impose for its e-book imprints (warning: some four-letter words used... not enough of them). After considerable public pressure — and, for the benefit of those idiots who don't know the industry, it was necessary public pressure to get that particular publisher's hierarchy to agree to move, and it came only after more-than-reasonable attempts to do things quietly behind the scenes — RH has agreed to give authors their less-than-the-rate-of-inflation raise. (I'm linking to Mr Scalzi's blog not because it's definitive, but both because he's the president of SFWA — the writer's group that actually forced the change — and because the links within his various pieces will take you to a fairly full, documented account of the entire kerfluffle. Then, too, anyone going there from here will not even make a speedbump on his bandwidth.)
If I thought an organization as infused with Büroismus as is RHUSA could pull off something this Macchiavellian without leaving substantial evidence of the plot, though, I'd think of this as a big planned win for RH.
- If you believe the "all publicity is good publicity" meme, this was free publicity for RHUSA's new e-book-originals imprints. That publicity is going to long outlast the controversy.
- By climbing down under public pressure, RHUSA is going to leave the (false) impression that the underlying contract itself is largely negotiable. It is not; many of the worst terms in that contract, such as the overreaching warranty-and-indemnity clause that subjects authors to a claim of "breach" for mere assertions of foreign libel or religious blasphemy law, didn't even get mentioned.
- Note, too, that none of the decisionmakers at RHUSA came out of editorial. That's a really bad sign for the future; it's the equivalent of having two decades' worth of cars designed by the accounting and sales departments... and we know how well that turned out.
- Worst of all, this reifies "25% of net" as a "market reasonable" e-book royalty rate when an advance is offered... and 50% when it is not. These are not appropriate or fair rates, regardless of the purported "risk" borne by the publisher. Forget for the moment that the largest capital infusion in a publishing transaction is the value of the intellectual property provided by the author (I realize that Austrian-school economists don't accept that, but both the real world and most other economists do — and the accounting rules carry IP rights as capital assets, which should be a big hint), and that the author is engaging in a huge risk by creating that piece of property him/herself. The actual, properly-allocated cost bases indicate that the minimum rate of return to the author should be 50% of gross on an electronic publication. This set of rates is the equivalent of the bad union contract that Arch and the guys agreed to.
- Actually, that previous point may be optimistic in many ways, for a simple reason: It's not just the rates and advances, but the definition of "net" that is at issue. There was some movement, but only from the most egregious (and easily sacrificeable) extremes. The definition of "net" still bears a disturbing resemblance to "net profits" as conceived in Hollywood, and the initial proposal was in concept (not necessarily numerically, due to the different cost factors in publishing versus film/TV) uncomfortably close to that definition. It will be really interesting to see the documentation provided to back up deductions from gross the first time one of these deals gets challenged for inaccurate accounting a couple of years down the road...
And now, off to the fifteenth century for a week or so.