Marybeth Peters, Register of Copyrights (the person at the United States Library Of Congress in charge of the system that maintains records of who owns which copyright), has many things to say about the Google settlement. She was the first speaker at the conference Columbia Law School held in March on the settlement. The video of the conference is online.
As I was able to pause the video in order to transcribe parts of her speech, I learned (and will share) a great deal about her views that I haven’t seen reported elsewhere.
The first point she made, and the one she returned to many times, is that she’s troubled by the use of class action lawsuits to grab future rights because they are, in essence, legislation via litigation:
“I do believe that class actions generally look backward and settle infringements that have been in the past. And typically, when you go forward, it’s typically the prerogative of Congress, the legislative branch, to decide what the rules should be. And when they do that, they think of things like, ‘Are we meeting our treaty obligations?’ ‘What about the public interest?’ And everybody has an opportunity to be heard.
“And the question is, when you have a private agreement where there are private solutions that are in the nature of legislative action, resulting in something that would be a legislative action, is that a good thing?”
But does this settlement (and the earlier one, granting licenses by default to the defendants in the case now before the Supreme Court, Reed Elsevier v. Muchnick, No. 08-103) really change copyright law? Yes, by creating exceptions to the law that encompass almost all of the literary works that would be subject to it.
And the way such settlements change the law is particularly troubling. The infringers, i.e., the wrongdoers, the ones who should be paying steep penalties to deter them from future wrongdoing, always come out the winners.
Peters paraphrased the analysis of the Google settlement by Brewster Kahle, the creator of the online Wayback Machine: it creates new copyright laws and a new payment system, all to benefit a single monopoly, for access to the collective books of mankind.
Her own concerns about the agreement appear to mirror Kahle’s.
“One thing I do know is that the legislative process is what the Constitution had in mind with regard to copyright policy. There is a balance between encouraging creativity and rewarding authors. And it gave that power to the Congress. And the Congress does act, sometimes slowly, sometimes well, sometimes, not so well. But that’s the Constitutional balance.”
Peters also complained that there are many unanswered questions and the possibility of unintended consequences. (Several other speakers at the Columbia Law School conference, all experts on copyright, said they were confused about what the settlement really said).
What was clear is that the vast future license for Google troubles the person in charge of copyrights for the U.S.
It should trouble us all.
The above is part 4 of a series of blog posts on the settlement reached between Google, the Authors Guild and the Association of American Publishers to settle a copyright infringement case related to Google’s unauthorized scanning of books.
– Anita Bartholomew
What’s a fair ebook royalty?
Tags: book publishing, e-books, e-reader, ebook, ebooks, electronic books, ipad, Kindle, Publishing technology
This is a question that’s come up quite a bit lately with author and editor friends. Are the current standard ebook royalties (25 percent of receipts) fair? And if not, what would be fair?
The argument for raising royalties to 50 percent or greater of receipts is that ebooks don’t cost publishers anything to produce: no paper, no printing, no binding, no warehousing, no shipping, no returns. Whatever investment in editing, promotion, typesetting and design that the publisher made, had to be made in order to produce the print book. Producing an e-version is a trivial additional cost. So authors should get at least half because for the publisher, ebook revenue is gravy.
That argument assumes that everything stays the same in publishing and that ebooks will continue to be a small portion of books sold. We know, however, that publishing isn’t staying the same. Sales of e-readers and ebooks have risen dramatically in just the past year. Between the Kindle and the iPad, almost everyone expects that the ebook will be embraced by more readers. The pace of adoption should increase dramatically. The open question is how to quantify that adjective “dramatically.”
And for virtually every ebook bought, a print book isn’t.
Right now, ebooks are estimated to be about 5 percent of the market. What happens to the industry when they’re 25 percent?
Anyone who has read this blog more than once knows that I’m a fierce advocate for writers, am against the Google settlement because it’s a worse deal for writers than writers can get on their own from Google, and have urged writers to stand up for their rights on pay, copyright, and other issues.
So you might be surprised to learn that I’m not convinced that writers should demand 50 percent of receipts for ebook royalties.
I agree that 25 percent of receipts is too low. Publishing guru Mike Shatzkin estimates that on hardcover books, the “standard” royalty of 15 percent works out to about 27 to 32 percent of receipts, which in turn, after expenses, splits profits about 50/50 between author and publisher.
A 50/50 split of profits is fair. But that’s not the same as a 50/50 split of receipts. One day soon, e-publishing won’t be all gravy. It will be the way we publish books. And all the costs associated with publishing books (minus the printing and other costs that printed books incur but ebooks don’t) will have to factored into ebook pricing and royalty calculations.
You can bet that publishers are already factoring the future into their calculations as they set their 25 percent of receipts royalty schedules. Nobody can accurately predict the future though, and publishers are giving themselves ample padding.
The issue we need to address is how should receipts between publisher and author be split to account for a future where ebooks are a big chunk of the books sold? The goal should be that, after publishers’ costs are covered, authors and publishers share the profits 50/50.
The percentage of receipts authors would get with a fair (50/50 profit) royalty system is not 25 percent of receipts. But it’s not 50 percent of receipts either.
– Anita Bartholomew