Following the discussion at Winter Institute that we covered in Thursday’s lunch, Hachette Book Group ceo David Young formally confirmed their adoption of any agency model in a letter sent to agents. As part of that move, they will indeed drop their strategy of windowed releases and release e-books simultaneously with hardcovers
Young writes: “There are many advantages to the agency model, for our authors, retailers, consumers, and publishers. It allows Hachette to make pricing decisions that are rational and reflect the value of our authors’ works. In the long run this will enable Hachette to continue to invest in and nurture authors’ careers – from major blockbusters to new voices. Without this investment in our authors, the diversity of books available to consumers will contract, as will the diversity of retailers, and our literary culture will suffer.”
He also underscores that “these new terms open doors to all online e-book service providers and create more avenues for delivering e-books to readers.”
Noting that under the new model “we make less on each e-book sale under the new model; the author will continue to be fairly compensated and our e-book agents will make money on every digital sale. We’re willing to accept lower return for e-book sales as we control the value of our product – books, and content in general. We’re taking the long view on e-book pricing, and this new model helps protect the long term viability of the book marketplace.”
The press is on full alert on this story and will make every declaration by a house “breaking news,” but we’ll just remind you that five big houses essentially announced their adoption of the agency model last week by signing agreements with Apple.
Also yesterday afternoon, the Authors Guild posted that–as implied in a Guild/AAR panel discussion last month–John “Sargent confirmed that Macmillan’s standard e-book royalty would be 25% of receipts under their new boilerplate contract.” (Note that Sargent himself has not commented on this.) They add that “we look forward to continuing to discuss with Macmillan other provisions of its proposed new contract.” Meanwhile, a number of agents tweeted “25 percent of what?” after the posting, which is the new question that the agency model raises. Sargent said in his letter yesterday, “the change to an agency model will bring about yet another round of
discussion on royalties, and we look forward to solving this next step
in the puzzle with you.”