Random House Changes E-book Royalty Scheme for Worse

Any time a publisher talks about shifting from royalties based on cover price to royalties based on money they actually see, look out. You are about to lose income. That's what is happened over at Random House regarding e-books. Starting December 1, the royalty rate will be 25 percent of the amount Random receives.

A recent Random House contract states that on all copies of a work sold as an electronic book, the royalty will be 25% of the US suggested retail price until the book's advance has earned out, and 15% of the list price thereafter. Under the current (pre-change) royalty structure, on a book retailing for, say, $10.00, the e-book royalty would be $2.50 per download at 25%, then $1.50 per download when the royalty rate shifts to 15%.

By contrast, the new royalty of 25% of the net receipts comes to something like $1.25 per sale on a $10.00 book (25% of 50%). So, Random House's change is definitely a reduction of e-book income for authors.

Well, there's a surprise - a publisher trying to take even more of the money pool. Here's the other shoe that the article doesn't mention: that leaves the publisher open to striking better deals with the retailers because they have more room to give in some as a bargaining chip for, say, better placement on a web page (called marketing dollars) while still maintaining the previously realized margin. It's the writer who does the subsidizing.

Figure that if you deal with Random House this will affect you, according to the letter that has been floating about:

With the widespread use by consumers of electronic devices such as the iPod, the Amazon Kindle, and the Sony Reader, a significant market for ebooks and digitally delivered audio content is finally ready to emerge. In response, Random House is making major investments in our digital infrastructure and is creating digital files of active titles so that they are available for sales as ebooks, as downloadable audio, and for Internet search and discovery."

Might as well have all the authors chip in for Random's profit goals.

Review: Ubuntu for Non-Geeks

For those who tire of a Microsoft hegemony on their laptops and desktop PCs, there is another choice: Linux. This open source and essentially free version of Unix has the reputation of being for the über-techie, but if you want to give it a shot, there's a version called Ubuntu (a South African terms that means "humanity towards others") that may be up your alley. The book Ubuntu for Non-Geeks (2nd. edition) claims to be "a hands-on, project-based, take-it-slow guidebook for those interested in - but nervous about - switching to the Linux operating system."

I'd largely agree with this, and at $34.95, which includes a CD with the operating system (you can even try it before fully installing it on your hard drive), it's a cheap experiment. However, depending on what you want to do, it may be a bit trickier, technically, than the book implies.

Trying the oeprating system was as easy as putting the CD into my drive and rebooting. I had a problem with my laptop, whose hardware required me to press the F12 key to pick the booting device. (Typically the PC will first try to boot off the CD, if there is one present, and then the hard drive.) But it passed quickly enough.

The operating system is reasonably easy to learn, is much faster than Windows given the same hardware, and comes with a complete suite of software that includes spreadsheet, database, presentation creator, and word processor. You can save out in Microsoft-type formats, so you get compatibility. (I didn't try this with complicated documents, as I've seen such "save as" features in other packages to be restricted in what they could do.) There is even a version of GIMP, which is a full-featured image editor that some people use instead of paying for Photoshop.

I did eventually install Ubuntu onto the hard drives of both my computers, though as a dual boot: when the computer starts, I can choose either Ubuntu or Windows. But getting everything to work can be a little tricky. For example, many modems depend on leveraging the processing power of Windows and the PC's hardware, and that doesn't necessarily work well with Linux. The book has directions of where to look on the web for help in configuring a modem, but it can be a complex process. (It's a big thing here, because I'm so far out in rural area that we only have dial-up.) To get it to work, you hneed to be online, but to be on line you need it to work - a telecommunications Catch 22. I've copied the files I need (I think) to the Windows part of my hard drive, and when I have time I need to copy it to a CD to then make it available to Ubuntu when I boot that up. You see what I mean - this can take patience. But working with wireless appears that it might be easier, although I haven't had a chance to try that, as my laptop is now in the shop for an unrelated problem.

Overall, I like the book, but if you're interested in giving it a shot, be sure to treat it as an experiment until you have the chance to see how easily you adapt to the system, and run it for a while from the CD to get your C-legs. (Sorry, that's a joke for the true techies.)

Book Review: No by Jim Camp

I've seen plenty books on business and writing, but this is one of the rare times I'd rate a title a must read. That isn't because the writing is so exemplary (though it's decent enough), but because you need to hear what it says. No: The Only Negotiating System You Need for Work and Home is about negotiation strategy and theory as described by someone who has been teaching and conducting negotiation successfully for large businesses for 20 years.

The title is striking and a deliberate contrast to the word yes, evoking the image of "Getting to Yes" and other win/win-based negotiation strategies. Camp argues that long-standing approach to negotiation actually leads to terrible negotiations. It's not that Camp suggests a take-no-prisoners attitude. On the contrary, he argues that a negotiation is a deal that any participant has the right to veto. That's the key - being able to say no to something that really doesn't work for you, and being able to hear no from the other party.

Win/win strategies can develop an unconscious premise that you must work out a deal - that both sides have to compromise. Therefore, you go into a negotiation ready and even determined to compromise, even if you don't need to. I had always thought of myself as negotiating in this style, but when I read Camp's book, I realized that it's not the case. Perhaps that's why I have taken so strongly to this book - it reflects my own experiences, including the need to be able to walk away from a deal, not appearing needy, understanding that you don't need to be liked by the other party, and recognizing your own value and not compromising on that.

Camp's emphasis is to take the emotion out of negotiation and, instead, to work from a reasoned approach based on sophisticated communication (like putting things in a way that speak to the other party's experience) and strong personal purpose. To his mind, almost everything is negotiation, including sales, and he has some interesting and, I think, valid views, like focusing on the process of what you are doing and not trying to control outcomes that you have no power over. An example is the sales person looking only at a quota and not realizing that sames come as a result of right selling effort, and to improve and expand the effort will, in and of itself, improve the results.

The book, just out in June, is going for as little as under $13 at Amazon. This will be one of the best and cheapest investments you can make in your career.