November 19th, 2010

EBooks, Foreign Rights, and Reluctant Pirates

Alana Joli Abbott reminded me that I hadn't read Rose Fox in awhile, so I spent an hour yesterday catching up at the Publishers Weekly Genreville blog. Highly recommended. This post from last week was important because people higher in the publishing food chain than I have begun to admit that the foreign rights business model is already doing and could do hugely more damage to the ebook business.

An awful lot of people think that the Internet, being global, is truly a global marketplace. The sad truth is that if you're in Australia, you may not be able to buy an ebook offered from England, or the US, or along many other vectors that cross a border. People in France often cannot buy English translations of French works, and in fact the world is carved up into regional and language ghettos that ebooks cannot legally leave. I'm not making this up, nor exaggerating: See Lost Book Sales for more examples than you could want.

The problem is an ancient carryover from the print book business, where publication rights to a book are brokered by language and often by nation. This used to be necessary to get international distribution at all, since gladhanding and then coddling multiple retailers on the other side of the planet is an expensive business that most publishers (especially small ones) simply can't do. Applying the international rights/publishing/distribution model to ebooks is idiotic, since any IP address can connect with any other IP address and there is no physical inventory to manage, move, or return.

It's easy to blame authors (which publishers are glad to do) for shouting "Mine! Mine! Mine! Mine!" about international rights, amidst fever dreams of making a fortune brokering Urdu translations of their books to the Pakistani equivalent of Macmillan--assuming that there is a Pakistani equivalent of Macmillan. In truth, midlist foreign rights sales don't make a huge amount of money for publishers, and very little money at all for authors. (I've been both an author and a publisher and have worked both sides of that street.) It's probably something like a 97/3 rule: A tiny handful of authors and books make a fortune on foreign rights, and everybody else gets peanuts, or just empty (contractual) shells.

Authors don't help by vastly overestimating the commercial potential of their work, but the reality is this: Foreign rights sales are an easy and reliable (if minor) revenue stream for publishers, and the publishers will not give them up without a fight. There's a lot of rentseeking involved and a lot of ego on the line. National governments generally support foreign rights agreements because local activity generates local tax revenue, whereas an EPub file flying over a national border generates nothing.

And so we have the absurdity of purchasers, money in hand, pleading in vain with retailers to sell them the product. The publishing industry is in deep denial about what comes next: The spurned buyers run over to RapidShare or Usenet and simply download the product for free. Online content is basically sold on the honor system, and if the author/publisher/retailer side of things doesn't appear to be serious about being a business, why should readers be serious about being paying customers? I've often wondered whether a thwarted purchaser who figures out how to download ebooks from Usenet (it's not trivial) will ever rejoin the legal marketplace at all.

The solution is simple, if not easy: One ebook, one world, one market. How we get there is unclear. Authors may need to get tough with publishers in peculiar and counterintuitive ways: "Take these global rights or I'll throw them at you!"

Or maybe authors just need to take over the publishing industry. No, this doesn't mean self-publishing. (If only it were that easy.)

More as time allows.