How to Spot, and Avoid, “Pay to Play” Publishing Contracts
By Susan Spann | March 27, 2017 |
In recent months, I’ve seen the resurgence of several terrible “pay to play” publishing contracts that authors should learn to recognize and avoid.
My law school contracts professor used to warn us, regularly, that “a person can make as good a deal, or AS BAD A DEAL, as he or she is able.”
Accept one of these particular contracts, and you’ll be making a very bad deal indeed:
BAD CONTRACT #1: “WE PUBLISH, YOU PAY”
In this type of contract, the author pays the publisher for some or all of the editing, publishing, and/or distribution costs to produce the book. Often, the costs are not listed up front, leaving the author on the hook for undisclosed (and generally, enormous) sums. Where costs are listed, they normally exceed the amount the author would pay to hire professional developmental and copy editors, cover designers, formatters, and printers in order to produce and publish the work herself.
In a traditional publishing deal the publisher, not the author, pays the publishing and distribution costs.
Beware: “pay to play” terms sometimes lurk in the royalty language, too.
If a contract lets the publisher deduct the costs of editing, publishing, and distribution of the work before calculating the author’s royalty share, that means the author is paying some of the publishing costs. Even though the contract may not require the author to pay the publisher out-of-pocket, this kind of language is still inappropriate in a traditional publishing deal.
Some non-traditional publishing houses openly offer “shared-cost” publishing arrangements, where author and publisher share the costs, control, and income on an equal basis. However, these arrangements are always disclosed as such up front, and these publishers don’t try to masquerade as “traditional” houses. They often refer to themselves as “hybrid presses” – and while some are legitimate, others are not. Always have these contracts reviewed by a publishing lawyer or agent before you sign.
BAD CONTRACT #2: “WE PUBLISH, YOU BUY”
Many publishers give the author a certain number of copies of the finished work for free. Most contracts also permit the author to purchase finished copies, usually at a significant discount. But legitimate publishing contracts don’t ever require the author to purchase books from the publisher … at any price.
One publishing “offer” I see a lot requires the author to purchase several thousand copies (sadly, that’s not a typo) of the finished work—and to pay the publisher for them in advance! Some of these contracts cost the author tens of thousands of dollars, with no recourse if the finished work is unprofessional or full of errors.
Legitimate publishing contracts never require the author to purchase copies of the finished book.
Time for some publishing math: if the author is forced to buy 5,000 copies of his book, how many copies does the publisher have to sell to other people in order to make a profit?
The answer, of course, is none—and publishers that use mandatory-purchase contracts generally make little or no effort to sell the books they publish (except to the authors). Mandatory author sales generate all the profit the publisher needs.
BAD CONTRACT #3: MANDATORY MARKETING SERVICES
In this contract, an unsuspecting author is offered a “traditional publishing deal” – meaning the publisher pays the publishing costs and offers industry-standard royalties on sales – but the contract contains a “mandatory marketing agreement” (or addendum) that requires the author to pay the publisher (or an affiliated marketing company) thousands of dollars to market and advertise the author’s book.
This is not a traditional publishing deal, and it’s not a good deal for the author.
Once again, the author pays thousands of dollars (in some cases, $10,000 or more), in return for often-unspecified “marketing” efforts. When the contract does list the marketing services, they usually include only things the publisher (or its “marketing arm”) can do in-house–and that the writer can do more cheaply for himself or herself–for example, press releases and posts for the author’s and publisher’s own social media channels. The services sometimes include “advertising design” but not the cost of actually running ads in any magazine or other forum.
As with the “We Publish, You Buy” scenario, this type of publisher doesn’t make its money selling books. When the publisher makes thousands of dollars per author in marketing fees, the publisher doesn’t need to sell any books to make a profit.
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The takeaway: in a traditional publishing deal, the author never pays the publisher (or a publisher-affiliated marketing agency). With only a few, very rare, exceptions, traditional publishing deals involve a unidirectional flow of money: from the publisher to the author.
If anyone tries to persuade you differently, run–don’t walk–in the other direction. The career, and the money, you save will be your own.
Have you ever seen one of these “pay to play” publishing contracts, or other unfair publishing deals?
Susan Spann writes the Hiro Hattori Novels (Shinobi Mysteries) featuring ninja detective Hiro Hattori and his Portuguese Jesuit sidekick, Father Mateo, who solve mysteries set in medieval Japan. Her first novel, Claws of the Cat: A Shinobi Mystery (Minotaur, 2013) was a Library Journal mystery debut of the month and a finalist for the Silver Falchion Award for Best First Novel. Her fourth Hiro Hattori novel, The Ninja’s Daughter, releases August 2, 2016 from Seventh Street Books.
Susan is the 2015 Rocky Mountain Fiction Writers’ Writer of the Year, and also a transactional attorney whose practice focuses on business and publishing law. She founded and curates the Twitter hashtag #PubLaw (for Writers), where she answers questions and provides information about publishing business and legal issues.
When not writing or representing clients, Susan enjoys traditional archery, reading fiction and nonfiction, and raising seahorses and rare corals in her marine aquarium. She lives outside Sacramento, California, but you can find her online at https://www.SusanSpann.com, on Twitter (@SusanSpann), or on Facebook/SusanSpannBooks.
Susan-
Good review of bad publishing deals. Contracts with legit print publishers can be full of adverse provisions, too, though less nightmarish than those you cite. The problems they create, if they do, come later in a book’s life.
You advise writers to have contracts reviewed by a publishing attorney. I’m often asked where to find one. I have contacts to recommend when asked, but perhaps you know of a general resource?
Hi Don –
You’re absolutely right about traditional print contracts being filled with lurkers (even when they’re “good” offers).
I’m actually in the process of trying to build a list of reputable publishing attorneys who review contracts for unrepresented authors. One of the issues is the single-state licensing of attorneys, which restricts all of us in terms of what we can and can’t review – generally (with some exceptions), the lawyer will have to be licensed either in the state where the client lives or in the state where the publisher is located – which makes this a thorny issue in a lot of cases.
I used to do a lot of this, for California clients, and I’m in-house contracts manager for Donaghy Literary Agency (as well as outside counsel to some California agents and authors) but when people are looking for representation in states I don’t handle, I normally recommend that authors contact the Author’s Guild. I think the AG has a list of attorneys they can recommend.
That said, I think most reputable agents (yourself included) know as much about publishing contracts as many lawyers do, so as long as authors have either a lawyer or a good agent behind them, they should be OK.
Sorry I can’t be more help with this – I do have a couple of individual referrals, in North and South Carolina and in Texas – but most of my clients come in through California, where I’m licensed, or through the agents I work with (either DLG or the ones in California) so I haven’t needed too many referrals outside the state.
This is such a timely post. I just received a contract where the publisher is deducting the costs of editing, publishing, and distribution of the work before calculating the author’s (my) royalty share. I haven’t signed it yet, and just wrote them that this seems more like a partnership than a conventional publisher/author contract. I’m waiting to hear what they say. I’m not entirely averse to a “hybrid” deal but like you say, it has to be transparent and upfront; with both parties agreeing to the definition. Thanks for sharing your knowledge!
It can be so tempting to agree to these type of deals simply to see your words in print. That’s why it’s so important to expose those who prey our weaknesses. Thank you for writing this article, Susan.
Great post – writers need reminding of perils. I have a simple rule – if they want money up-front, walk away. Even ‘hybrid’ publishers should be treated with caution.
I have – a writer friend may never ‘catch up’ to what she paid out. Companies that “prey” on people’s hopes and dreams are maddening.
I always caution writers to take a step back, take a deep breath, and don’t be in such a hurry to publish that you’ll 1) publish a book before it’s ready; 2) enter into a contract that is with disreputable “publishers.”
While I’ve never had to pay a dime – I’m paid – I understand wanting to go it on your own, but yes, do your research well! I’m happy you provided this service for authors.
What a great resource, especially for beginning authors who may not know the difference between a good deal and a bad deal. I have counseled a few new writers to run as fast as they can from a publisher who asks them to pay.
Yes. A friend saw CFP (Christian Faith Publishing) and forward it on to me. After being “accepted by an agent” and all the fluff, I received the contract before committing. And to my surprise, they wanted 10,000.00 (for two books, 1-of which is completely done professionally, from editing to the cover. The other one, I know needed work, and they knew that.) they were charging 5,000.00 per book, regardless.
This article was spot on, and a good reminder of what to look for. Thanks.
So, you have a lot to say about the problems of signing with self-publishers. But you don’t really say what you should do instead. Most of us aren’t really capable of going through the process without some help. While I’m sure that in the past there have been a lot of hucksters offering self publishing services, I think some of that is changing. You would be a lot more helpful if you would actually research these services and make some recommendations, rather than just tarring everyone with the same brush. For instance, I’ve found a lot of good reviews for Christian Faith Publishing by actual clients. I’ve only ever found one bad one. It’s great to recommend going with a traditional publisher, but I hope you realize that inspite of no money up front, you still end up doing a lot of the legwork yourself. THAT IS, IF YOU CAN EVEN GET ONE OF THEM TO LOOK AT YOUR BOOK. Traditional publishing is pretty well an old boy’s club. If you’re a newcomer, they won’t even look at your project.