Subsidiary Rights and Why We Keep Them
March 18, 2010
Meeting Pinkies

It is springtime here in New York, and as happens every spring, young hearts turn to thoughts of the Bologna Book Fair.Or my old heart does, anyway. Every year, children's books publishers and agents from all over the world gather in Bologna to buy and sell the rights to published and forthcoming books, to catch up with each other about trends, and to eat some truly excellent food. It is four days of constant meetings from nine to nine (some over drinks and dinner plates, true, but meetings nonetheless). From these meetings, many sales of properties are made to far-flung territories.This can be a great benefit for a writer, the sale of individual rights to different countries. It means that the writer receives separate advances for each territory, and that each of those advances earns out on its own schedule. So even if the publisher in the US stumbles and the book does poorly here, it may still sell well elsewhere and the writer will still earn royalties. These separate income streams make it easier for a writer to actually make a living from writing.Which is why we hold on to foreign and other subsidiary rights when we sell a project to a publisher. It can mean taking a smaller advance up front, or the outright rejection of an offer, and it can make us unpopular with certain publishers. Why? Because the publisher, of course, wants these rights, too.When the publisher controls those rights and sells a foreign license, the advance for that foreign sale—and any royalties paid—are first applied toward paying back the publisher for the advance given to the author. Conceivably, a book could earn back its advance for the publisher without ever selling a single copy in the US. Good for the publisher, not so good for the author.Not long ago, I had a conversation about this very subject with an editor, in which she explained her position. Namely, that an author should want the publisher to keep rights, because that makes it "easier for the publisher to earn back the advance and makes the writer more profitable for the house."Which sounds nice on the face of things, but has all sorts of buried sentiments and assumptions lurking within. Let's unpack that sentence, so that we can see how very wrong-headed it is.For one thing, the implication is that the publisher will be happy with the author and continue to publish that author happily for the next forty years if the publisher earns back its advances by recouping the money through foreign sales.But that's just not true. Foreign sales matter almost not at all to a publisher's decision to publish future titles by an author. If the author's books bomb at home and continue to tank domestically, while the publisher will be happy it recouped its advance in the foreign sales, it won't feel any love for the author. The publisher will have covered its bets on the author, but it will also likely stop betting on that author at all. And the advance, while it may be large, is a mere fraction of the cost of bringing a book to market. So collecting some foreign advances (typically smaller) will do little to offset the actual cost of publishing a book.So let's say the publisher fumbles the publication in this market, but the book is a hit in France—well, the entity that most benefits is the publisher, not the author. Which, to that editor's mind, makes perfect sense. The publisher, after all, gambled; why shouldn't it earn back its money first?But why should the publisher expect that the author will support the publisher? If anything, it should be the other way around, though even that is a questionable proposition. Instead, the author should find a way to make a living by exploiting as much as possible the rights to his or her work. And the publisher should pay advances it feels it can earn back via sales in its home territory.One might also ask whether the publisher is even the best entity to most effectively sell those rights? Few—if any—publishers push hard for the sale of titles after a book's debut year. The publisher's list grows by dozens of titles each season, and those books require attention, while the backlist languishes. And the publisher's subsidiary rights team? They collect their paychecks whether they sell a book or not. The success or failure of an individual title matters little.That's not the story for an agency, however. The agency gets paid only when it sells rights, so it works to keep the focus on older titles even when adding new ones to the list. (Because though the agency's list will grow, it will never grow at the rate of a publisher's.) Older titles are re-presented with new positioning, in the hopes that new sales can be made, new paychecks collected, and the author given a real shot at making a living.