Friday, January 27, 2012

Sign of the Times?

I heard a disturbing rumor -- and I have to repeat, this is a rumor, not something I saw personally -- about an agency contract that takes a standard commission on an author's self-published books. Self-published. So the author would be contractually obligated to pay 15% of their self-published royalties to the agent even if the agent has never laid eyes on the book.

The theory behind this is that the agent is "building" the author's career through traditional sales, and the author benefits from that in direct published sales, so the agent is entitled to a cut.

This is utter garbage, of course. Not every tenuous connection creates an entitlement. What's next -- if you write on your day job, they can take 15% of your day job salary, too? Agents act as brokers, selling books to publishers and earning a commission on those sales. Why should they ever be entitled to earn anything without performing the work?

You know what's really going on here? They're gambling that you're more desperate than they are. They're pretty desperate, some of these agents, because sales and advances are falling across the board, so agents are taking hits just as much as anyone in this business. Or, to put it another way, 15% of nothing is nothing. Actually, that's 15% of 8% or whatever your trad pub contract calls for. But your direct pub royalty rate is probably anywhere from 30% to 70%, depending on how you distribute and price the book, so 15% of that is a bit more of a cut to the agent. As an added bonus, it's free money because they didn't have to lift a finger to earn it.

But there will be some writer out there who's been struggling to break in and who sees this as the one chance to do that. And they'll sign away their kidneys and lungs if they think that will get them a good book deal. So what's 15% in perpetuity on work the agency never sold? As long as the agent signs you, it's all good, right? No. Not right at all. For one thing, you don't know that this agent will ever sell a single thing for you. Plenty of authors are signed but never sold. You don't know whether this agent will treat you well or screw things up for you -- and if you don't understand that agents can screw up a writer's career, you haven't spent much time talking to writers about agents.

Don't get me wrong. A good agent is worth every (legitimately earned) cent you pay them. If you get a good agent, thank your lucky stars and buy them chocolate. But how do you know what kind of relationship you'll have with your agent when you're at the signing stage? Oh, you can go by reputation. Maybe Agent Alice has a great reputation because she represents a bestseller or two. But sometimes these powerhouse agents focus all their attention on the stars. They take you on in the hope they can get a star deal for you, too, but if they can't, they're stuck with you just as you're stuck with them. That's how their stables get filled with authors who wonder why they can't get a call back.

And reputation only tells a partial story. In this business, in public, we're all quick to praise and slow to criticize. (Notice, for example, that even though I'm not hiding my annoyance at this contract provision, I have not named the agency or the agent. I might be mouthy, but I'm not that stupid.) If you don't share a confidential relationship with at least one of the agent's clients, you might not be hearing the whole story.

Be smart, kids. It's a cruel and treacherous world we're living in.

Theresa

ETA: Since this post went live this morning, I've received confirmation of two agencies doing this. One was the original agency that prompted this post, and the other is a mid-sized agency with questionable ethics. Anybody know what the AAR has to say about this?

31 comments:

Wes said...

Thank you, T, for the heads-up and advice. I know a couple of writers who had bad experiences with their agents and fired them. One, who's book is doing very well since she self-published it, is having great difficulty getting rid of her agent. I don't know the details, but the author told me the agent is trying to claim commission on the self-published book even though she had nothing to do with it.

I'll remember the advice about the chocolate.

Edittorrent said...

That's troubling, Wes, because it means that unless the agent is with the same (fairly large) agency I heard about, then this practice exists at more than one agency. I haven't heard about it until now, but then, I haven't been agent-shopping.

T

Nicole said...

I would have never even thought to be concerned about this. If I snag an agent offer, I'll definitely ask about this. Thanks for the heads up.

Misha Gericke said...

What I have to wonder is this: How could people think that that's ok?

Sigh... maybe I'm not as cynical as I'd thought.

About Tori said...

I'm pretty sure it's not just the one agency, because I've heard this before. Which is one of the reasons (among many)I quit submitting to agents and publishing houses.

Emma said...

Thanks for this information. I must admit that I gave up chasing agents a while back. If ever I get one interested I'll sure read the small print.

Evangeline Holland said...

The latest thing I've heard from AAR was on Kristin Nelson's blog, where AAR discussed their stance on agents as e-publishers. Perhaps this news will reach their ears and they will make another statement.

Tony T said...

If you're going to post something like this, post the names of the agencies so people know to avoid. All you're doing is spreading a rumor. Have some balls.

Edittorrent said...

You don't need to know the names of the agencies or my sources. You need to know to watch out for this kind of contract language from any agency. You think other agencies can't have this kind of language? You think knowing to avoid A & B agencies will help you avoid bad contract language from C agency? Sheesh. You tell me to get some balls, well, I'll tell you to get some brains. People trust me because they know I'm careful about revealing source information. I'm not going to destroy their anonymity for a total stranger with no last name.
Theresa

theresa said...

hahaha i luved ur reply to tony t! thanks for posting this, btw, very helpful.

(incidentally, we have the same name!)

Dela said...

Not just rumor. I know of two instances where this is going on, related to me by people with direct experience of it.

Tony T, you're obviously unfamiliar with our industry. People don't use names in public because (a) the offending agencies instantly threaten to sue (and who needs that stress?, and (b) MUCH MORE TO THE POINT, the issue isn't that writers need to avoid those agencies in particular, the issue is that writers need to READ AND UNDERSTAND EVERYTHING THEY SIGN, KNOW THEIR RIGHTS, and avoid/dump ANY agency exercising these and other egregious practicess--not just avoid "a" specific agency (which, in any case, will deny even to a lawyer's face, never mind in a blog like this, that their egregious agency agreements actually say what they say).

Alex Lukeman said...

Thanks for this post. I also gave up on the agencies and agents.The self-publishing revolution is bringing out the dark side of publishing and agency practices.

Bob Sanchez said...

Read the agency contract. If it's not in there, they have no claim to your non-agented revenues. If the contract claims the right to such money, you shouldn't sign with them in the first place.

If your agent sells a title for you, the publisher sends the royalty checks to them, not to the author. They get their share before you get yours. But if you self-publish, monies come right to you. How would the agency even know?

I suspect this isn't a valid issue.

Morgan Mandel said...

I gave up on agencies and traditional publishing, because for one thing I don't have the time to waste.

Still, this is good to know for those who are starting out and want to make a name for themselves.

Morgan Mandel
http://morganmandel.blogspot.com

PG Forte said...

"if you don't understand that agents can screw up a writer's career, you haven't spent much time talking to writers about agents." <-- THIS. Single best piece of advice ever.

Edittorrent said...

Tony T, you could post your whole name too, if you had some. (BTW, We're women. We have ovaries. :)

We are trying to pass on what we are hearing. If you signed a similar contract to that agency agreement, you probably would wish you'd been warned.

But -- shrug-- you are welcome to look around and find some other blog where names are named no matter what, and maybe then you'll be able to sign your own name, because, you know, where's the danger, right?

Come on. If you don't want the information, if the explanation isn't enough for you to know to avoid such a contract, then you might find your own sources of information and then you'll know all you want to know. Not sure what the names would do for you, as it's the contract clauses that count, but hey! Go for it! and report back what you learn on your own, if you like!

Alex, I'm with you on that-- if agents can help writers earn more money, they'll have no trouble finding clients without resorting to strong-armed tactics and trickery. But I think the industry is sort of falling out underneath them, and only the agents who make real money for clients are going to survive. And the ones who earn money by depriving writers of value, and those are the ones we should avoid by listening to people who know more and reading contracts and asking other writers for input.

Alicia

Edittorrent said...

@Bob Sanchez -- actually, they could require that the self-published money be sent to them. I've read plenty of agency contracts over the years, including the one I co-authored when I was an agent, and I haven't seen language quite like this before. This is an extension of interminable rights. You would think it would be hard to extend interminable rights, but there you have it.

But you're right -- for every writer out there, the best advice is to read your contract and make sure you understand it before you sign it.

Theresa

Anonymous said...

"they could require that the self-published money be sent to them."

OMG, can you imagine? You self-publish your book... and set up the account so that the money is sent to the literary agent?

As INSANE as agreeing to that sounds... I suppose that ruthless, unprincpled, unethical agencies (of which there are too many, unfortunately) could strong-arm clients into doing that by threatening to drop them as clients if they don't. (Or threatening to sue them, if they've signed anything which the agency chooses to interpret as giving them the right to receive the client's self-published earnings.)

Joyce Henderson said...

Interesting that this should come up when I'm considering signing with an agent again. Also interesting that I thought of this little "wrinkle" when I was reading the contract. Not that the wording was specific about self-published books, but I simply thought of it out of the blue. I wrote in a clause excluding my self-publishing books if I ever take the time to get that chore done. I sent back the contract with that clause and a couple other changes, oh, three weeks ago, maybe. I haven't heard back. Wonder if I will?

Alan said...

This story illustrated something I've found myself saying a lot lately-- all publishing relationships really do have to be based on trust. It is SO not a good idea to sign any contract until you've thoroughly checked through not only the contract terms but the people you're agreeing to do business with.

Wes said...

Again, I don't know the details, but the agent who tried to claim commissions on my friend's self-published book is with a small agency, so I suspect we are talking about two different agencies.

Mhairi Simpson said...

A friend of mine found this in the boilerplate of her agency contract. She kicked up a stink and it was taken out before she signed.

Jesse said...

Question -- if the agency, in fact, is promoting your self-published book--getting book signings, speaking engagements, etc--don't you owe them that percentage for the work?

Edittorrent said...

Jesse, that's something you would either arrange on your own or would hire a publicist to do. Publicists are not paid on commission but receive a flat rate. If an agency has the expertise to do the PR and you want to hire them to do it, then the best (and standard) practice would be to negotiate a flat rate for it. But frankly, I would rather hire someone with expertise in literary PR.

Theresa

Unknown said...

The rumour is true, but it doesn't apply to any old self-published book. There are agencies who have established links with e-publishers for manuscripts that they believe in but have failed to find a traditional publishing house for, because the publisher cannot see an obvious readership and so is not prepared to 'take a risk' on an otherwise good book.
These are authors who have signed with the agent and have received free editorial help to bring the mss up to publishable standard. The agent has earned their 15%, and will negotiate any contract with a publishing house once the book shows it has a readership. The author is paying the agent to build their career, not simply to look on as they self-publish a one off manuscript.

Alicia said...

Jesse, to me, that's a sign that the role of a literary agent is becoming sort of hopelessly tangled. Literary agents have one important function: To sell books to publishers (and negotiate the contract, but even that isn't always their part). If they're not doing that (and they wouldn't in the scenario there-- self-pubbed books, or books sold by someone else), then they're not acting as literary agents.

All this "editorial guidance" and "publicity" and "promotion assistance" and "formatting assistance" is new, and is not what literary agents do for 15%. For 15%, they sell the book. If they don't sell it, they don't get 15%.

If they also want to set up as free-lance editors or publicists or personal assistants or travel agents, maybe okay (though probably afoul of the agent's ethical code, which apparently doesn't count anymore), but they should charge for all that separately and the author should be allowed NOT to pay for services she doesn't want, and certainly not to be forced to do it with money from books the agent didn't sell.

Agents are hurting, no doubt about it. But frankly, in the 90s they made themselves far too important to the process of getting published, made themselves gatekeepers, lorded their power over the people with actual writing talent-- "You're nothing without us!"

Part of the enormous liberation long-published authors like me feel with indie publishing is freedom from the agents. I can't tell you how good that feels, and I've had a lot of agents (and only one I'd recommend, actually).

It was bad enough to be dependent on someone else to send the manuscript out and determine to whom-- now we're supposed to pay them for NOT doing that?

Alicia {no fan of the system)

Edittorrent said...

Unknown, if you believe that anyone who has a hand in "building" an author is entitled to a commission, then good luck to you. You're going to need it. Unless you're an agent perpetrating this scenario, and in that case, shame on you.

Agents don't earn their money from editing. Agents earn their money from selling manuscripts to publishers, negotiating the deals, and managing the contracts. You pay them the 15% because of their industry connections and the work they do on the contract -- not because they failed to sell your book and you feel sorry for them because they spent time trying. They work on commission, not on flat rates.

Let's see, who else has helped every author "build" their careers? Every teacher they had from preschool through the end. Every critique partner they've ever had. Every member of every writers group meeting they've ever attended. Every speaker they've ever listened to. Every newspaper or alumni magazine that writes an article, every review blog or reviewer on goodreads or amazon that rates the book, every person who tells someone, "I read this great book" -- they are all entitled to a percentage of the author's royalties by your logic.

It's bad logic, and it has to end before it gains a foothold.

Theresa

Edittorrent said...

Also want to point out that I have seen this language, with my own two eyes, in a contract with an agent who does not have a self-publishing support arm. That is also not a rumor, though you are free to do what you will with the information.

Theresa

Edittorrent said...

Unknown, not to beat up on the anonymous here! But really, in this contract you speak of, does it even distinguish between "books I the agent really believed in and helped with and spent gobs of time on but couldn't sell because of myopic editors and publishers, and now the writer has done all this work and sold it herself or selfpubbed it" and "all other books she might write or have written without any help from me"?

Theresa points out the flaw in the "help" part-- frankly, agents haven't ever "helped" me write a book, and they shouldn't, anymore than a real estate agent should help homeowners pay their mortgages-- but even so, these contract clauses are not exclusive to certain books, but inclusive of all books.

If agents want to earn money from self-published books, they should write their own and publish them.

If they want to be editors, they should set up as independent editors and charge by the page like the rest of us.

If they want to be publishers, they should set up a publishing company, incorporate, and put some capital into it, and earn money by selling copies of the books and paying authors a royalty, not by charging authors a percentage of sales.

If agents are going to dispense with the agency model, then they should be consistent and dispense with the commission payment.

I feel sorry for some agents because I know they are about to lose their livelihood. But buggy whip designers lost their businesses too. It happens. The world moves on. We adapt. This is not a useful adaptation.

Alicia

Missy Lyons said...

Boooooooo!!!

Dela said...

As Edittorrent has accurately stated, the job of an agent--for which the agent earns commission--is to submit a book until making a sale, negotiate the sale, and handle the business end of the agreement.

In real-world contrast to the idealistic concepts put forth here (that the agent "builds" a writer's career, organizes publicity, arranges speaking engagements, etc.), negotiating the deal and managing the business directly associated with it (ex. asking the publisher where the overdue payment is) is indeed the extent of an agent's job.

Moreover, in the real world, most agents don't even do THAT much and/or don't do it well. As EditTorrent alluded to, one of the widespread problems of the industry since the 1990s has been that a large percentage of agents have a frequent tendency to REFUSE to submit books. It is one of the most commonly-discussed problems of writers viz the agents they've fired or are thinking about firing; the writers can't get their agents to SUBMIT their work. Inadequate negotiation skills is another common problem. (And a third very common problem is that once the commission money has been pocketed, the agent tends to be reluctant and heel-dragging about further involvement in the business end of the deal, such as asking the publisher for missing monies, confronting the publisher about long-since delivered books which still haven't been edited, paid for, or scheduled for release; etc.)

I agree completely with EditTorrent that the functions being asserted in some of the comments here AS IF they were part of the agent's job (either real -or- theoretical) would indeed fall under the heading of "manager" if one person were going to take on tasks such as PR, organizing signing tours, booking speaking engagements, etc. in addition to submitting books and negotiating the deals. To date, writers don't have "managers" and it's not something that exists as a profession in our (or linked to our) field. Of course, it's entirely possible that could change. But at this time it does not exist, nor do payment structures for it exist. Nor do the vast majority of literary agents perform any of these functions. (Typically, a literary agent's "advising on PR" consists entirely of saying to the client, "You should have a website.")

So when talking abou a literary agent, one is talking, with regard to the original topic of this blog post, about someone who didn't negotiate a publishing deal and thus earn a commission... but who is nonethless demanding a commission payment from the client for a self-published book AS IF the agent HAD negotiated a publishing deal for it.

On that basis, the client in question should also be paying a commission on those earnings to YOU and to ME, since we also did not sell the book to a publisher or negotiate a publishing deal for it.