Editorial by Randy Petway
In December, The Wall Street Journal reported that British publisher Harvill Secker UK pulled its ebook version of The Search Warrant by Nobel Prize for Literature winner Patrick Modiano from Amazon.co.uk because “It turns out that Harvill Secker didn’t have the rights to publish the ebook, which Mr. Modiano’s French publisher, Éditions Gallimard, discovered after the prize was announced, according to Anne-Solange Noble, Gallimard’s foreign-rights director.” If Modiano had not won the Nobel Prize and been the focus of so much media attention, this situation might not have been noticed for some time. Unfortunately, this is a fairly commonplace situation for publishers around the world, sometimes ending in more dramatic terms — legal ramifications, loss of money, and damaging of relationships.
Historically, publishers have made very little investment in the infrastructure for managing rights, often allowing the task to fall to junior staff members. And perhaps rightly so in an earlier, more straightforward world where rights sales were mostly in print to foreign publishers, were a very small portion of a company’s overall revenue, went directly to the bottom line, and were not factored into the profit and loss statement (P&L). One of the reasons that the system of managing rights has not traditionally demanded investment is that the rights department is not actually creating anything while funds tend to go into acquiring and developing new products—books, authors, marketing and publicity. The risk factor of ignoring this problem, however, is huge.
With the proliferation of rights opportunities—types, channels, geography, format, fragmentation — and the need for additional revenue sources today, they simply cannot be managed through the old systems of paper, Post-Its, or even the rights department’s institutional knowledge. Rights and licensing has become a matrix with an impossible number of points to manage both for sales opportunities and contract compliance. The rise of digital publishing and subscription models have only expanded the matrix exponentially, offering more ways of licensing, more rules, and more complexity.
Publishers are licensing rights they do not own, overpaying or underpaying on royalties, not complying with contract stipulations and deadlines, mishandling their intellectual property. and often missing out on opportunities to sell rights because they are not aware of what they control. Publishers need to implement a robust rights and licensing system to manage the incredible amount of IP they are handling. In addition, the rights department often lacks visibility even to the rest of the publishing company of what rights have been sold, what needs to be chased, and who is to chase it — manually or otherwise.
Additionally, publishers are being squeezed and, all of a sudden, need to increase revenue sources. Rights are an optimal place to start, but an investment needs to be made in a place where publishers have not traditionally invested. While similar industries mine their catalog of content for future revenue, publishers have not traditionally done so. There are a lot of financial possibilities that come with monetizing backlist rights.
No matter what system or structure publishers opt for to manage their rights, the most important thing publishers need to do is to fully understand what was offered, held back, and outlined in past contracts as well as outline the granularity of what they would like to own in future contracts.
Randy Petway is the EVP, Global Product Strategy, Publishing Technology. Randy will be speaking at the upcoming “Designing Books for Tomorrow’s Readers” conference on March 26th about Publishing Technology’s Millennial Research and at 1:00pm, April 16th at the London Book Fair on “Rights on the Money: Are you fully monetizing your IP?”