AAR, DOJ and the Agency Model

The AAR recently sent a letter to the DOJ unanimously supporting the Agency model.  I find it odd that the AAR has yet to send a collective letter to the Big 6 asking for higher, and fairer, royalty rates for their authors’ electronic rights.  (This post is a version that was originally published at Digitla Book World on 10 May)

Perhaps the focus of the AAR is misplaced?  As an author and a publisher, I wear two hats, so I see a couple of facets of this situation from different perspectives.

Perhaps the focus of publishers trying to defend their pricing model is misplaced?  Their business model is shifting much faster than they can adapt to from distribution to discoverability.

Here’s the deal.  For too long some agents and many publishers mistakenly believed they actually created the PRODUCT that readers consumed:  i.e. the book.  Even with print, that’s not true.  The PRODUCT is the story, the words.  The printed book was the medium by which those words reached the reader.  Thus agents and publishers and bookstores were, and still are, facilitators.  Not creators.  As an author I create content.  As a publisher I facilitate getting content to readers.  I literally have two different offices in my house for the two different jobs.

The subtle arrogance built from years of having their own form of monopoly on publishing is now costing many in the industry and it makes the AAR letter to the DOJ regarding Amazon somewhat ironic.  As I’ve pointed out:  Amazon didn’t exist except in one man’s mind in 1994.  How much have agents, publishers and bookstores changed and adapted in the past 18 years?  In 2011 I had to radically change my approach to publishing.  My old approach had served me very well for 20 years, but projecting forward and studying other parts of the entertainment business as they encountered the digital wave, it was apparent a radical overhaul was needed in my career.

When the music business crashed and burned because of digital in the early part of the last decade how many authors, agents, publishers and bookstores, invested time and money to prepare for an inevitable digital wave?  I shook my head at all the hoopla raised when Tor decided to go DRM free a few weeks ago.  To me it was another sign of how far behind the times the Big 6 are.  At Digital Book World in January, my estimate was at least a year (an eternity in the digital world) and it hasn’t changed enough since then.

The medium is shifting from print to digital much faster than most still understand and 99% of the pundits (who are still punditting and being believed even though they have been wrong over and over) predicted.  Thus agents, publishers, bookstores, and everyone else between the author and the reader have to adapt.  We have to prove our value as a facilitator in that connection.  Instead, what we’re seeing is an entrenchment to hold to being the “gatekeepers”; the “curators”; whatever you want to call it.  Even some authors have jumped on the bandwagon, such as Scott Turow; but those on the bandwagon, are those who’ve been on the top 5% bandwagon. Of course they want to see the established system stay in place.  It works quite well for them.

Back when the Amazon-MacMillan battle was fought over pricing and MacMillan “won” I was also shaking my head.  In my opinion, based on having studied warfare and been a soldier both in the Infantry and Special Forces for many years, Amazon clearly won the war, while ceding the battle.  Perhaps a brush up with Sun Tzu might help?

Amazon clearly flexed its muscles and showed its capability, let MacMillan raise prices, which consumers just love, and moved on (now moving into the fashion world, to the dismay of the facilitators in that medium).  Since then, what exactly has MacMillan done to facilitate the writer to reader connection?  Kept eBook prices artificially high, while not increasing royalties to their authors any significant amount.

To be honest, I want the Agency model to continue.  It gives Cool Gus Publishing a great pricing advantage over legacy publishers.  When readers have to choose between our eBooks at $2.99 to $4.99 and a legacy eBook at $12.99, more often than not, our book gets the nod.  Please, NY, keep your eBook prices high.

At Cool Gus Publishing, we had to write a four page fact sheet to give to authors when they ask why they should give up an percentage of what they could make on their own self-publishing by signing with us. Our percentage is very small, especially when compared to the Big 6 or even most smaller e-publishers.  We have to prove our worth as a facilitator.  If we can’t, then we can’t stay in business as a publisher.  We have to be honest and upfront about it.

The issue now for agents, publishers and bookstores is not fighting a futile battle against Amazon and the inevitable digital world, but rather this:  how to adapt to become a worthwhile facilitator between author and reader?  What value do I add to this process?  The standard answers are quality control, editorial, print distribution (not dead yet! To quote Monty Python), etc.  But readers are making the ultimate quality control decisions now with the buy button.  Editorial can be outsourced to freelancers (many of them fleeing the sinking Titanic in NYC).  We don’t care much about print distribution as we make a “very nice deal” each month on eBook sales alone and don’t have to assume the high overhead of printing, physical sales forces, distribution, returns, etc. etc.  Digital also means we can shift quickly when needed, such as recently completely redoing the covers for my entire Atlantis series based on reader feedback, marketing research, metadata, and studying daily, weekly and monthly sales figures.  We did that in a week.  It’s taken the first NY imprint years to remove DRM.  We used DRM on a few books when we started in January of 2010 but quickly removed DRM because it’s what our customers preferred.  Our customers are readers, not agents, publishers, sales reps, book buyers, or bookstores.  I believe we run a form of what some have now labeled “agile” publishing?  We called it flex publishing about a year ago.

Perhaps the AAR, and others, might better spend their time writing letters about how they can change and help readers connect with good authors and authors connect with readers?

About Bob Mayer

West Point Graduate, former Green Beret and NY Times bestselling author Bob Mayer has had over 50 books published. He has sold over five million books, and is in demand as a team-building, life-changing, and leadership speaker and consultant for his Who Dares Wins concept. He's been on bestseller lists in thriller, science fiction, suspense, action, war, historical fiction and is the only male author on the Romance Writers of America Honor Roll. Born in the Bronx, Bob attended West Point and earned a BA in psychology with honors and then served as an Infantry platoon leader, a battalion scout platoon leader, and a brigade recon platoon leader in the 1st Cavalry Division. He joined Special Forces and commanded a Green Beret A Team. He served as the operations officer for 2nd Battalion, 10th Special Forces Group (Airborne) and with Special Operations Command (Special Projects) in Hawaii. Later he taught at the Special Forces Qualification Course at the John F. Kennedy Special Warfare Center and School at Fort Bragg, the course which trains new Green Berets. He lived in Korea where he earned a Black Belt in Martial Arts. He's earned a Masters Degree in Education.

Posted on May 22, 2012, in Publishing, Write It forward and tagged , , , , , , , , . Bookmark the permalink. 17 Comments.

  1. Author Kristen Lamb

    It is really shocking how far NY is behind. I just came from a conference and all I could do was shake my head at some of the advice and scare tactics. Thanks for keeping us plugged in so well in the changing paradigm. I love your posts.

  2. great post bob, very cool to read comments like these from someone that wears multiple hats AND has publ. through traditional channels and through self publ. channels…. love the comment about wanting the ebook prices to stay high! thanks

  3. Well said as always Bob. Every time some new “terror of the publishing moment” comes along I find myself torn between wanting to know the reason and a strong desire to click past it and move ahead without concern – like seeing a tank sitting still in the middle of a meadow and not knowing if its occupied. Seems most of the time they aren’t. Thanks for taking the time to keep us appraised with a useful, insightful and common sense point of view.

  4. Bob, you make so much sense. Thanks for this post.

  5. Gene, I feel the same way – torn between wanting to know and wanting to NOT know. Thanks, Bob, for keeping us all up to speed on the changes.

  6. Good stuff. But there’s a nuance in “When the music business crashed and burned because of digital…” that bears examination. You wouldn’t say that “We were ambushed because of the terrain.” You were ambushed because the enemy wanted to attack you. The terrain only enabled the ambush. The music industry crashed and burned because of years of mis-management, a major part being their mistreatment of musicians. The digital environment simply enabled the revolt that had to come in one way or another. Then the music publishing industry accelerated their demise by declaring war on their customers – a spectacularly bad strategy. Other media, such as TV and movies are thriving in the digital environment. Book publishers would do well to learn from the music publishers’ errors. They could start by adjusting their attitude as you outline in this post. Business as usual is not going to succeed in the new environment.

    • another good post, Bob. I was reminded of this situation by a sign I saw on my way to work: ESL classes here, tonight at 6:30PM. If I don’t speak english, odds are I don’t read it – so the advertising message was a waste of someone’s time and money.

      I am also wondering about theatres. Given pay per view and netflix and so on, how long can these monstrosities survive? It is about $50 to take my granddaughter to a movie with some popcorn and soda. that pays for a lot of pay per view movies at home.

      Every industry has to accept that the digital revolution is changing everything. and it’s happening now.

  7. Thanks for more of your insight and experience. I have yet to publish a novel. I have one ready to go, another in the drawer that needs attending and a third partway there. It’s confusing which direction to take. It seems to me there’s more pressure on writers today–whether they are self-published or published traditionally–to market, market, market. It’s the wearing of two hats that makes for a heavy head.

  8. LOL to Diana’s “heavy head”. It’s true. Self-pubbing is exhausting work. And desperate Big 6-ers are scary. That’s why innovative, nimble small publishers like Cool Gus will feature strongly in the future of publishing, IMO.

  9. Ashley raised some good points about the music business and, Bob, you always keep me looking ahead and learning about the publishing business.
    When I did your Warrior Writers course a couple of years ago, most of us where writing goals like “I want to be on the New York Times best selling list”. (Side question – do these ‘old school’ best selling lists take e-book sales into account? I should know, but I don’t.)
    Now, while writing the best books I can is still the number one objective, the second objective is building my online platform – how do I connect with potential readers? What can I offer that adds to their world in a positive way and then gives me the opportunity to talk with them about my books?
    The questions and learning about publishing – traditional, e-pub and self-pub – will never stop. I think it’s pretty exciting really. It’s certainly not what I expected as an avid paperback reader looking to craft her own stories and get them published, but who says that’s a bad thing?
    Keep up the good work, Bob, and thanks for sharing your knowledge.

  10. Thanks, Bob. It’s helped me a lot to read yours and Kristen Lamb’s posts over the years. I recently signed with a small press, and love it so far.

  11. Yvette Carol

    Hear Hear! I agree with all the people responding here. Bob, you’re a star, leading the way and shining a bright light, as always. The AAR and others, would do best to sit up and take note of what bloggers like you and Kristen are saying, before it’s too late. When Mark Twain heard rumours that the New York Journal had printed his obituary, he said, ”Rumors of my death have been greatly exaggerated.” Unfortunately the same may not be said for the traditional publishing industry if things continue the way they are now!
    Thanks for the update Bob!
    Yvette Carol

  12. I agree that the Big 6 have to rethink royalty rates for their e-authors. On another loop for romance authors, one author had been approached by her ex publisher to reprint her books as ebooks, and she was advised to say no and do it herself because she’d get better rates. I think that is the only way they are going to be better for authors to readers, with a better price and royalty rate for authors.

  13. Great post, Bob! Spot on, my friend!

    I wish these kind of responses (from AAR and Top 5% Authors Guild Members) surprised me, but they don’t.

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