Saturday, July 24, 2010

Large-publisher reactions to Amazon Kindle Odyssey Editions deal

This is a follow-up on large-publisher unhappiness over the situation with Literary Agent Andrew Wylie and his Kindle Odyssey Editions in partnership with Amazon.  See details in yesterday's article.

Amazon’s Exclusive New Publishing Deal Threatens to Fracture E-book Market

Lauren Indvik, at Mashable  writes (emphases mine):
' The problem is that it’s still unclear — at least to Random House — who has the rights to publish the electronic versions of older titles, whose contracts don’t specify those rights because e-books simply didn’t exist when they were drafted.

 Random House sent a letter to literary agents in December 2009 asserting ownership of those rights, citing clauses in older agreements that allow the company to publish texts “in book form… in any and all editions.”

  Agents and authors were surprised to receive the missive, given the outcome of a lawsuit between Random House and RosettaBooks LLC in 2001. According to the WSJ, Random House tried to prevent the latter from selling the e-book editions of works by William Styron, Robert Parker and Kurt Vonnegurt Jr.; the U.S. District Court for the Southern District of New York ruled in RosettaBooks’s favor, claiming that Random House’s earlier contracts didn’t cover e-books. A federal court of appeals affirmed the decision. '

There's quite a bit more in that article.

From Nikke Finke's Deadline New York
Random House Bullying Agents On E-Books - But Is It Legal?

Mike Fleming writes, re publisher reaction:
' Random House responded with sheer thuggery, blacklisting Wylie in a clear attempt to scare other authors and their reps from trying the same thing.  Other publishers also expressed outrage in different ways, like Macmillan CEO John Sargent, who railed about how Wylie’s exclusive deals excluded other e-devices like the Sony Reader (like Macmillan really cares about anything other than its own fortunes).  What neither of these houses addressed is the $64,000 question:  do they control e-book rights in contracts signed before anyone imagined that e-books might surpass print titles?  Many feel the answer is no. '

Fleming also describes Random House's 2001 "suing for summary judgment to stop an e-book venture called Rosetta Books," which they lost.  More recently Bertelsmann Publishing chairman Marcus Dohl let agents know that Bertelsmann was "determined to to protect its e-book rights, but once again, not mentioning whether it actually controlled them."

A well-connected dealmaker, Fleming says, described their approach this way
' “They say, we have publishing rights to these books, it costs us a fortune to run this place, and e-books are a huge source of revenue.  If we can’t have it all, we’re not working with you.”

I’m told there are two categories of contracts that are causing top publishers to lose sleep at night.  There are deals made before e-books existed, where a standard clause read that “all rights not granted to the publisher” belong to the author.  Many feel Random House would be hard pressed to win that issue in court.  Later contracts are also suspect, despite ambiguous lingo that mentioned things like “microfiche,” but not specifically e-books.'
... up until 2000, publishers just didn’t have electronic rights,” said Trident Media Group chairman Robert Gottlieb. “Between 30-40% of their income comes from back list sales, and between now and 20125 [sic -- should be '2015'], 50-60% of book sales will migrate to e-books.  These publishers will not be able to afford to stay in business if they lose those back lists.

There's a lot more of interest in this article too, so visit both sites for the details.

 Also, the NY Times MediaDecoder blog has more on Wylie's surprised reaction to the Random House threat to not enter into new English-language business agreements with Wylie and his 700+ clients until this issue is 'resolved.'

From BNet
Why Jeff Bezos is Fiddling While Amazon's Share Prices are Falling

  For one thing, the shares made a comeback the same day.  For those who are interested in why Amazon had a bad day (analysts' estimates weren't met even though Amazon again had a very profitable quarter), this is a longish but very clearly-written article on the dynamics involved.

 One point from the several given for why Bezos and others are unfazed:
' Still Growing – There are worse problems to have during a recession than having cash available to invest in expansion.
  Indeed, Amazon continues to evolve from dedicated book e-tailer to virtual general store.  With additional sales of electronics and general merchandise, CFO Tom Szkutak said the company was growing so fast it needed to open 13 new fulfillment centers this year and added around 2,200 employees to the payroll. '

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  1. This is a bit confusing. I would have thought Agencies had the least right to publish backlists in e-book format. However, if the publishers had any brains, they'd rush these same titles into digital production, undercut Amazon & make them available to all e-tailers.

    Then, hopefully, they'd do the same for some "good" back titles. I read a few of these when they came out & never wanted contact with them again.

    PS: Love your blog -- very informative!

  2. Anonymous,
    When the e-book rights have not been made explicit, the way they are these days, usually it's the author who retains those rights.

    The author can have the Agent take care of it, I suppose.

    The publishers can't willy nilly do this without clear rights which they have to negotiate with the creator of the work (or the creator's agent).

    Chuckled at your take on the iconic books.

    Glad you're enjoying the blog though! ;-)


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