Information Today
Volume 18, Issue 7 July/August 2001
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The Authors Guild Issues Warning About iPublish Contract

The Authors Guild has issued a warning to its members that experimenting in digital publishing with Time Warner's new iPublish division (see page 41 of the June 2001 issue or http://www.infotoday.com/it/jun01/news11.htm) presents substantial legal risks and the loss of literary rights for little pay. The guild has urged all writers to approach iPublish with extreme caution.

According to the press release, established writers who are merely dabbling in a new medium may find they've inadvertently granted a laundry list of rights to Time Warner and agreed to a bargain-basement advance for print rights to their work. Worse yet, writers surrender rights to their next work as well, agreeing to sell the digital rights to iPublish for advances as low as $25 or less. Writers agree to the terms of this contract by submitting their manuscripts to iPublish. A link to the contract is available on the iPublish site at http://www.ipublish.com/iwrite/submit_main.asp.

"The seductive appeal of e-book publication should not blind authors to the risk involved in the iPublish contract," said Letty Cottin Pogrebin, president ofThe Authors Guild. "No professional writer or responsible agent would accept terms that call for the author's virtual surrender of basic literary rights, yet with its pitiful advances and draconian option clause, this contract does just that. The Authors Guild deplores Time Warner's exploitive approach. We strongly advise authors who are interested in digital publication to hold out for a publishing partner who respects their work and a publishing agreement that reflects fundamental standards of fair industry practice."

According to The Authors Guild, the publishing contract contains the following unusual provisions that could prove costly to unwary writers:

  • Writers grant broad rights to iPublish, not merely e-book rights. Time Warner claims the exclusive rights to any means of delivering digital content, regardless of whether those means have yet been invented. The sweeping definition of digital rights granted includes audiobook rights and rights to digitally printed books, such as print-on-demand books. The writer also grants Time Warner an option on the traditional print rights to the work.

  • Royalties are low. Royalties for e-books are pegged at 25 percent of net sales (except in the highly unlikely event that the author earns $25,000 from digital media sales). This is a scant amount for e-book royalties, since e-books can be produced at practically no cost.

  • No advance is paid for the e-book. Time Warner's iPublish is selective in the works it chooses to publish as an e-book. Just as a publisher pays the author an advance when it selectively acquires rights to publish a work in traditional form, so should a publisher pay an advance when it selects a work to publish electronically, especially when the publisher ties up other literary rights as well.

  • Print book advance is locked in at $5,000. Time Warner obtains an exclusive option to publish the work in print form. The advance for print publication is fixed at $5,000, even if the author and Time Warner fail to agree to the other contractual terms. If, on failing to negotiate an agreement with Time Warner, the author goes to another publisher, Time Warner still has the option to obtain the work on the same terms as the other publisher, but never has to pay an advance greater than $5,000.

  • Time Warner controls the author's next work. Regardless of whether Time Warner acquires the print rights to the original work, it has a claim on the author's next work. It can acquire those rights by exercising an option equal to the proceeds the author earns for the first work.

  • Authors could be forced to pay Time Warner for specious claims. If anyone makes a claim that an author's work is libelous or invades privacy, regardless of the merits of that claim, Time Warner has the right to settle the claim without the author's approval and charge the author for the settlement amount and Time Warner's legal fees. There is no provision for insuring the author against such claims, as is generally included in traditional publishing contracts.
Writers seeking more information may contact The Authors Guild's legal services department at staff@authorsguild.org or 212/563-5904.

Source: The Authors Guild, New York, 212/563-5904; http://www.authorsguild.org.

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