Is it Worth to Go With a Publisher?

When people say that ebooks are forever, that may be true in the strictest sense of the word.  But your ownership rights in your (self-published or published) ebook will terminate seventy years after your death, and that will undoubtedly restrict your commercial ability to exploit things. 

If you sign a traditional publishing contract, you do not tie up your rights forever:  All U.S. authors have the statutory right to terminate a grant of rights 35 years after publication under 17 U.S.C. 203.  “However, an author (or the heirs) need to  terminate the grant of rights during a period of five years beginning at the end of thirty-five years.”

Another aspect is: money earned today is worth more than money earned next year.  That’s because you could take the money you earned today, put it in the bank, and have more money waiting for you next year.  What that means is that if someone offered to give you $50 a month every month forever, with no stopping, they aren’t offering you an infinite amount of money.  You can actually put a finite dollar value on how much that costs.

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The Value of Your Rights

Courtney Milan explains: “Here are the things you need to do to figure out the net present value of your rights.  For the calculations that follow at the end, I’m going to use 2% as the rate. This is actually high when you compare it to today’s discount rate, but interest rates are historically low, and we’re doing the calculation over 35 years.”

“What you’re being offered: Let’s take the example if someone who is offered $3,500 royalty advance for a book.  What would it take for the net present value of your self-published earnings to come out to $3,500?  Using 2% as the discount rate, a contract that offers you $3,500 is the equivalent of earning $139 a year for 35 years, making $11.58 a month.  That’s what a $3,500 a book means.  A $3,500 advance is an absolutely pitiful investment by a publisher. They will earn back what they put in without even batting an eyelash…”

“What if you were offered $500,000 for a book?  That’s a huge advance.  A self-published book that has the same net present value is one that makes $19,750 a year, $1,645 a month – which means selling about 633 copies at $3.99 a month every month.  Put another way, a book at $3.99 that falls somewhere between Amazon rank 5,000 and 10,000 for 35 years is worth $500,000 today.”

What kind of steady sales would you need to equal that advance over time? Ask if it’s worth it.  There are a lot of reasons why people go with traditional publishers.

They don’t want to do the work.
They want books on the shelves.
They want the prestige.
They think the publisher will do a better job in marketing.
They want reviews in major print publications.
Some people want the advertisement that a big print run will give them.
Some people think it’ll help them break out to the next level.
Some people think that diversification is important in income, and so want to diversify.  And so on…

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Read the rest of the eye-opening article:

http://www.courtneymilan.com/ramblings/2013/08/19/know-what-your-rights-are-worth/

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