We have been hearing again how hard up authors are becoming. The Guardian‘s article sets out the recent debate quite clearly.

I dare say the evidence being used doesn’t lie. It’s just that I don’t think the evidence being used is the right evidence. Authors (tend to) work on a royalty basis, a percentage payment made for each copy sold. If authors are really earning less than they used to, this must surely mean that either the royalty rate has been reduced, or fewer copies have been sold. I don’t believe that royalty rates have been reduced, and the fact that nobody seems to be making that argument rather supports this belief, so only one conclusion remains — one that we all already know. Books now sell in smaller quantities than in the past — with the possible exception of bestsellers.

The fact that royalty payments represent this or that percentage of a publisher’s profit or turnover is irrelevant. Profit is made in various ways, and short-changing the author is not usually one of them. Apart from the morality of cheating your authors, it tends to be bad for the future as word gets out and new writers become reluctant to sign up with you. Like selling books, signing authors is a competitive market. The people working for publishing houses might consider a similar calculation as to the relationship between wages and profit to be even more interesting — it would at least be more relevant, wages having a greater effect on profitability than royalties. Nobody imagines that authors, when they decide to become writers, are signing on for the security of a middle-class income: in all probablity most of them have eschewed that option and gone for the freedom of making their own way. Some play for the big time seeing success as massive sales, while others aim more for an interesting and fulfilling life. I’d love for them all to make more money, but the harsh reality of the marketplace governs.

As the market flattens, and as trade conditions toughen, publishers have begun to look at those advances which used to be thrown around as bargaining chips in competition for this or that “big” book. Many of these advances did not earn out, and it’s not too surprising that publishers have begun to reevaluate their advance positions. If, instead of using blue-sky forecasts to fix on the advance, you make rather pessimistic sales forecasts, then naturally the size of advances will come down just as the percentage which don’t earn out will fall. From the point of view of the generality of authors this will appear as a reduction in earnings (even if the earnings were actually royalties for books which were never sold). For publishers it will lead to an increased profit margin. Does the Society of Authors really want to argue that publishers should be ashamed of not making large unearned royalty payments any longer?

Now one could envisage a system which mandated that books should be sold at X times their page count, and that the authors should get W%  of that, the booksellers Y%, and the publishers Z%. That however is not the system we live with, and I doubt any legislature anywhere would be willing even to debate such an idea. We live in a system where the author’s remuneration is based on the number of copies sold. The brutal fact is that fewer copies of more titles are now being sold than hitherto. Naturally the size of the pot for each author is smaller. If as an author you are fed up with that deal, there is now the wonderful option of self publishing.

See also How to boost your sales?