Amazon.com Inc. (AMZN)'s proposal to give writers all of the proceeds from digital-book sales leaves authors like Jeff Deaver in a bind. Deaver is caught in a tug of war between his publisher, Hachette Book Group, and Amazon. The disagreement focuses on how to divvy up revenue generated from sales of e-books, which has ensnared a widening stable of authors including J.K. Rowling, Stephen Colbert and James Patterson. Amazon, seeking to ratchet up pressure on Hachette, took its appeal directly to writers at the publishing house this week by asking them what they thought of gaining all of the proceeds from sales of e-books. The move threatens to up-end the long-held relationships that authors have with publishers, complicating the months-long disagreement that has involved Amazon blocking pre-orders of certain Hachette books and removing discounts from some titles. "We authors are being enlisted to bring pressure on our publisher that we have a very good relationship with by a company I've been in a good relationship with," said Deaver, who has written more than 30 novels including "The Skin Collector." Accepting Amazon's deal without a publisher's approval would violate publisher-writer contracts and open authors up to lawsuits, said Joseph Capobianco, a partner at Garden City, New York-based law firm Reisman Peirez Reisman & Capobianco LLP who specializes in transactional and business law. Writers currently receive 25 percent of e-book sales according to contracts with their publishers, said Roxana Robinson, president of the Authors Guild. Getting Squeezed The proposal "puts authors back in the middle rather than removing them," said Steven Gould, who wrote science-fiction novel "Jumper" and is president of the Science Fiction and Fantasy Writers of America. "It actually is asking them to take sides against their own publishers who they have agreements with." The proposal set off a new round of backbiting between Amazon and Hachette in a dispute that first flared into the open in May. Hachette this week rejected Amazon's move, asking "Amazon to withdraw the sanctions they have unilaterally imposed." Hachette can afford to give authors the e-book revenues, Sarah Gelman, a spokeswoman at Seattle-based Amazon, said in a statement. Kindle books make up just 1 percent of sales of Lagardère SCA (MMB), Hachette's parent company, Gelman said, so the publisher "should stop using their authors as human shields." Sophie Cottrell, a spokeswoman for Hachette, didn't respond to requests for comment. The dispute is raging as digital-book revenue is projected to jump more than eightfold to $8.7 billion this year from 2010, according to Forrester Research. Loyal Writers Authors owe it to publishers to stick with them, said Douglas Preston, co-author of the Pendergast series, who recently wrote a petition to Amazon to resolve the dispute with Hachette without hurting writers. In book contracts with publishers, authors typically receive an advance, essentially a loan that gives them income while they write the book, he said. The advances can range anywhere from $25,000 to the low $70,000s depending on the author's experience, he said. For his book coming out in August, "The Lost Island," Hachette gave him an advance based on what the publisher believes it would earn. "I don't get any money until the advance is earned out," he said. "I could never have written my first book if I had to work for two to three years without making any money." Amazon Supporters Other writers said Amazon's proposal -- in which the Web retailer would also return book prices to where they were before the dispute, bring inventory of print books back to normal and start selling pre-orders again -- makes sense. Some writers and readers have uploaded a petition to Change.org to defend Amazon's position. The offer itself "is more than reasonable," said Valerie Douglas, an independent author who writes fantasy fiction and who signed the Change.org petition. Yet she added that it "sort of puts everything back in the author's lap. It says to them: we'll give you 100 percent of the profits, and you can work it out however you want to with Hachette." The extra income from e-book revenue would most benefit Hachette's authors who have some success and yet aren't at the bestseller level, she said. Those writers are hurting the most from the dispute since they depend on pre-orders and actual sales, she said. Amazon could simply separate writers from the publishing spat by bringing back book discounts and reinstating normal selling conditions for print and digital books, said Deaver. Offering e-book revenues is unnecessary, he added. "Don't expect many other authors and me to remain quiet when you have techniques like this to extort authors into putting pressure on their publisher and also putting pressure on the publisher directly," he said. Source : Bloomberg
