All the hard work and months (or years) of attending workshops, writers’ groups, and revising and revising again have paid off. As excited as you may be, the next step, negotiating the publishing agreement, may give you nightmares. You’d rather sign and be done with it, but I’d think again.
The contract is written in the publisher’s favor, and if you’re not careful, it could lead to headaches down the road that can be avoided before signing.
Out of all the provisions in a publishing agreement, I’m routinely asked about the grant of rights, advances, royalties, and option clause. Below is a summary of those important provisions in your book.
Please note that the information below is not intended to be legal advice and should not be taken as such. If you have any questions, contact a publishing attorney near you.
The grant of rights is the provision in your agreement that acts as a map to the rest of the contract. As the author of your book, you are given a set of exclusive rights per Section 106 of the US Copyright Act, such as having the exclusive power to:
As the copyright owner, you have the power to determine who you want to transfer these rights to. To publish a book (unless you are a self-published author), you have to transfer the reproduction right above. That can happen in two ways: granting the publisher a license or assigning the publisher the reproduction right.
Licenses are rights that are granted to a third party. There are three parts to a license that you need to consider:
An exclusive license means that the party you are granting a right to is the only one who can execute that right. Non-exclusive licenses mean just the opposite, where you can transfer a right to multiple parties at the same time.
However, most publishers won’t accept a non-exclusive license.
Can you blame them? Why would Simon and Schuster accept a non-exclusive license, when you can turn around and go to their competitor HarperCollins and sign another license to publish your book? There would be two competing books, and no publisher wants that. Thus, most licenses you will deal with in publishing will be exclusive.
Next you’ll need to determine the territory that is best to execute those rights. In the US there are three basic types of exclusive deals:
Most publishers will ask for world rights in all languages. But your agent (or lawyer) will determine what is best for your book. Perhaps your agent thinks your book may be a hit in the UK, and he or she only wants to grant the US publisher rights domestically, so he or she can negotiate a contract in the UK. Context matters.
Finally, you’ll see that the term of the license is likely for the life of the copyright in your book, which is for your entire lifetime + 70 years according to the US Copyright Act. Before you start freaking out that you’ll be under contract with the publisher until your grandkids are your age, don’t worry. There are other mechanisms, such as reversion of rights and out-of-print clauses, that can help you retain your copyright.
Assigning your rights means that you give everything away to a third party with regard to that particular right, and that you are no longer in control of what happens to your work. Most publishers will have in their standard boilerplates that you assign to them your right to publish the book.
However, you can negotiate this down to a license.
Once again, context matters. Academic publishers, for example, have assignments in their contracts per industry standard. That is because most authors are professors publishing their books to obtain tenure and may not exactly care about what happens to their work after publication. This is usually not the case with trade publishers. Nevertheless, talk to your attorney and agent to determine what course is best for you.
You may ask if you can terminate the assignment. You can via certain provisions in the US Copyright Act, but that is a blog for another day.
Regardless if you license or assign your publication right, ask your agent or lawyer to reserve any rights you don’t grant, so that they belong to you.
What do most people care about in contracts? You guessed it: money. How are they going to get paid? When are they going to get paid?
Advances are payments made to you before your book is published. That is, the publisher literally “advances” you money against future book royalties. This started because authors needed to earn money in between signing their book contracts and their publication dates.
Most publishers pay their advances to authors in 1/3’s or 1/2’s.
Below is a typical payment schedule:
Some publishers will pay your advance via the first two events. The first and third events are easy enough. Sign the contract, and publish the book, and you get paid.
The second event, however, is more perilous.
“Acceptance” of a manuscript means that the publisher has indeed read your manuscript and, in its sole discretion, deems it publishable.
An example best illustrates this concept. If you sign a publishing contract for a 100k-word fantasy novel and send the publisher ten pages you wrote over the previous nine months, your manuscript won’t be accepted. Nor should it.
The main obligation under your contract is to write the book, and you didn’t uphold your end of the bargain. However, if you send a 110k- or even 90k-word novel, as long as it resembles what you promised, that should be okay (editors can always ask to add or subtract words).
Again, context matters. The main takeaway is that you won’t get paid until the publisher “accepts” your manuscript, so do what you’re obligated to do, without violating the rights of others (think defamation, copyright infringement, etc.), and you should generally be fine.
The big question on everyone’s mind besides the advance: when do I get my royalties? What percentage are they? Are the numbers good?
I’m not going to go into a deep dive here, but there are a few things you need to know:
In addition to these royalties are “subsidiary rights,” which are “subsidiary” to the “primary” right of publishing your book. Some examples (and the royalty share between the author and publisher) are:
Before giving up these rights, see if your agent (or attorney) can separately negotiate these rights for you (for example, book-to-film adaptations). This means more money and revenue streams for you.
Most publishers will request that they get the first crack at your next book.
If you don’t like that, you can always ask to strike the provision. But more likely, you can ask them to narrow down the parameters of this provision (for example, if you’re a nonfiction writer or novelist who writes several genres, you may want to request that the option is only for a certain subject or certain genre).
Moreover, publishers will want to have an incredibly long time to determine if they want your second book (sometimes up to a year after publication of your first book). Ask your agent or lawyer to narrow this time period. There is no reason why you should have to wait up to an entire year just for a publisher to reject your second book.
I hope that the summary above helps in negotiating your contract.
by Joseph Perry (@PerryLiterary), January 24th, 2021
Trad-pubbed authors: Did you know all this before you signed your first contract? (I sure didn’t) I know many of our readers are self-publishers, but many self-publishers also publish some of their books with traditional publishers. Did you know all this stuff about publishing contracts? Authors who are planning to go the traditional publishing route, do you have any questions for Mr. Perry?
Joseph Perry is a literary agent and publishing attorney at Perry Literary, Inc., and The Law Offices of Joseph J. Perry, P.C. As an agent he represents bestselling cookbook authors, athletes, musicians, journalists, influencers, academics, and more. As an attorney, Joseph counsels clients in the publishing industry, where among other things, he drafts, reviews, and negotiates various publishing agreements and conducts prepublication review of manuscripts. Joseph obtained his Juris Doctor from St. John’s University School of Law and a Master of Arts and Bachelor of Arts in English from St. Bonaventure University. He is a graduate of New York University’s Summer Publishing Institute.
You can find Mr. Perry on Twitter @PerryLiterary, on Instagram @perry_lit, and Facebook at Joseph Perry Law and Perry Literary . His law firm is at www.josephperrylaw.com and agency website is www.perryliterary.com.
Anne writes funny mysteries and how-to-books for writers. She also writes poetry and short stories on occasion. Oh, yes, and she blogs. She's a contributor to Writer's Digest and the Novel and Short Story Writer's Market.
Her bestselling Camilla Randall Mystery RomCom Series features perennially down-on-her-luck former socialite Camilla Randall—who is a magnet for murder, mayhem and Mr. Wrong, but always solves the mystery in her quirky, but oh-so-polite way.
Anne lives on the Central Coast of California, near San Luis Obispo, the town Oprah called "The Happiest City in America."
Wow, genius points here and even without experience I can see you’ve attended to numerous details. Thanks Joseph- on balance it only makes me more scared to pursue a contract but at least I’ll have a handy reference for red flags. One question on audiobooks- my impression is that maybe three years ago a lot of publishers weren’t paying much attention to that in their contracts but now they routinely try to lock that up. Is that accomplished by slipping in the “rights” language? And do you think there’s much point to fighting to get out of that portion of the contract? I’m thinking some publishers may have in-house talent, but it might not be that great since they’re so recently into it. Thanks again!
Will
Hi Will, Thanks so much for reaching out. It’s a great question. Sometimes publishers will try to encapsulate all mediums into their grant of rights rights language. But more so the audio rights will likely be in your subsidiary rights section of your agreement, where the publisher typically wants to splits a certain percentage with you. You can ask to reserve this right (I know I routinely ask for it for my clients, and I haven’t run into issues). But I think the big question to ask yourself is whether you think the publisher has the talent to produce a great audiobook (or license it to a third party if you’re thinking of granting them the audio license). If not, see if you can reserve it to have your agent (or lawyer) get you a separate audio deal, which means more money for you (that you don’t have to split either). Hope this helps! If you have any other questions, feel free to reach out to me via my website, which is in my bio. All the best,
Joe
Joseph—As an editor, publisher and author who’s dealt with hundreds of contracts and as Anne’s blog partner, I can assure our readers that your helpful, concise guide is indispensable. Thank you so much for guesting! PS: An IP lawyer once told me: “net is gossamer.” lol
Thank you so much, Ruth! And for allowing me to guest blog. love helping writers, and I hope this helps your readers as they navigate the business side of publishing.
Alex J. Cavanaugh (@AlexJCavanaugh) says January 24, 2021 at 10:44 am
I didn’t know it as well with the first contract, but after several more, I understand rights and such much better.
I hope you enjoyed the article, Alex, and I’m glad to hear you understand rights more. If you any questions, don’t hesitate to reach out. All the best,
Joe
As helpful as the tips is the mindset. Thanks for showing that we need to know what the details mean and be mindful of protecting our intellectual assets. I’ve negotiated the sales of my film rights 3 different times. In the final analysis, no matter who represents you as the author–agent or attorney–ultimately all terms of the contract have to be acceptable to you. Never be afraid to walk away from a bad negotiation.
Hi Carmen, You’re very welcome. I totally agree. If it doesn’t feel right, walk away. Better that than entering into a deal you latter have issues with. All the best,
Joe
You’re very welcome, Gail. I love helping writers. If you have any questions, I’m always here to assist.
Thank you for a very informative article .Great stuff. Now I have to get writing in hopes I’ll be fortunate enough to need to refer back to this article.
You say, “you have “net” royalties because these royalties take all of the publishers’ expenses off the top before arriving at your royalty payment.” From the few contracts that I have negotiated with US publishers, the way I understand it is that “net’ is the proceeds that publisher gets from selling the book, which is around 50 percent of the list price. So if a publisher offers you only 10 percent of net, you will likely get around 5 percent of the list price of the book. But you can do better than that. For example, when I negotiated with Phil Wood of Ten Speed (now owned by Penguin Random House) for the US paperback rights to my “The Joy of Not Working”, we agreed to a royalty of 30 percent of net. This has continually worked out to about 15 percent of the list price. I also negotiated a 20 percent net royalty for the paperback rights of the first edition of “The Lazy Person’s Guide to Success” and that worked to around 10 percent of the list price of the book. In the first case I waived an advance so that I could get the higher royalties and in the second case I got a $10,000 advance. Incidentally, in both of the above two cases I retained the foreign rights and the ebook rights. This is really important. I have now negotiated around 120 book deals with publishers in 29 different countries for my 17 books. I have even been able to sell foreign rights to several of my books without the books having been published in English. Also, for my “The Joy of Not Working”, I have been able to sell the Korean rights to three different publishers, first published by Joo-Ang Daily News in Seoul, and for the second time by Mulpure, Seoul, and for the third time by Cresendo, Seoul. You can see most (but not all) of my foreign rights sales at: http://www.erniezelinski.com/Foreign-Rights.html
I knew none of this when I signed my first publishing contract, and had to learn the hard way. Ugh. Not fun. Contract negotiations are brutal, with both sides playing hardball. Talk about nail-biting suspense! My top tip is to make sure there’s an out-clause. With small presses, you want to be able to walk away if you’re not happy. With corporate publishers, you need to know when your rights will revert back to you if x, y, z happens. And never, ever, sign away your entire career by agreeing to a genre clause.
This is invaluable information. Thank you.Very helpful article! I will also say, “net” for royalties has become an increasingly nebulous term. In my latest contract, “net” referred to “list price of books sold net of returns,” for example. *shrugs* I find that it’s important to define nebulous terms, they’ve gotten me out of a few tough scrapes. Define “net,” and in my first contract with an indie, I had to define “publish”. As in, “Company X guarantees to publish the book within 6 months upon receipt of the manuscript…” When I queried, what they meant by “publish,” they specified “available in paperback and e-book to all major retailers, Amazon, B&N, etc.” Then when they ran out of steam after getting it up on Amazon and producing one 200-copy run on Ingram, they had violated the contract and I was able to terminate it. And this article alluded to it, but for any authors working with indie publishers, escape clauses and rights reversion are the single most important part of the contract. Independent publishers have a high mortality rate, and you want to make sure you can get your book back from the abyss! It definitely saved my bacon, because when I got my first contracts, I turned for advice to an author who’d also been burned by an imploding indie.
Really informative article, Joseph. Thank you. Contracts can be so complicated that writers tend to zone out, but it’s in our best interest to pay attention.
Thank-you so much. Your insight is powerful. I am a complete “newbie”.Very timely – a member of our writing group is just looking over his first publishing ccontract. I’m sure he’ll find this useful.
Does an author need a U.S./U.K. literary agent if he is working on a translation of his already- published work in a foreign language?
Hello, Generally speaking, you should. For translation deals, usually agents outside the US get US agents and act as co-agents, unless your agent thinks he or she can get you a deal themselves. If you don’t have an agent, then you’d have to go about the query process. Some publishers may accept unsolicited manuscripts. You can likely find those publishers by doing a Google search.
