Important Clause in Blogging Contracts

When I wrote about eight important principles in negotiating contracts, I mentioned a recent negotiation I undertook for some blogging work I'm doing. What I didn't mention is a clause that is of particular import in this line of work: traffic payment triggers. Many sites base their pay at least in part on traffic. Often, certain thresholds of page views result in a bonus. But accompanying bonuses can be an expectation of minimum traffic levels, below which a writer does not get paid.

I can understand trying to give writers incentives to pull in more traffic, and they can work to everyone's benefit, but there is a bottom line degree of marketing that the site owner must do. Yet, because many sites have implemented such a demand, there is some expectation of this being "reasonable." Obviously it isn't; asking writers to help create increased success is one thing, but expecting them to guarantee traffic unfairly shifts a responsibility of the business owner to the contractor.

I did find a negotiation strategy that worked. In the contract was also, as one might expect, a termination clause, giving either party the right to end the association with a certain amount of notice. I argued that as I am a professional writer, I must be paid if I'm producing the required work, but as the company could terminate the agreement without cause, it was free to do that should the traffic not meet its minimum expectations. Had they said no, I would have walked, even though there was an exemption for a number of months, as they realized that the site was still ramping up. Because I had already been doing some work during the negotiations, and they had seen a building of traffic, they were probably disinclined to have me leave. If they were happy to see me leave, then it was a relationship that wouldn't have lasted long anyway.

In contracts for online work, remember that practices are still developing, and writers overly anxious for exposure and an outlet have often encouraged ones that are simply untenable for a professional. Don't get outraged. Instead, Break apart the roles as laid out in the contract, contrast them to accepted basic business customs and look for other protections that the contract gives the publisher.

Eight Important Principles in Negotiating Contracts

I often hear writers talk about the difficulty in negotiating contracts and how they can't get changes. Admittedly, some publications simply will not bend. However, trying to get what you want is always the wise move, because often you can, even with large companies. For example, I was recently negotiating with a web site owned by a large broadcast company. A number of the clauses were unacceptable to me, whether a measure conveying copyright or a provision that I provide rights to anything in my articles, which would include fair use quotes I took from other sites.

First step was to mark up the contract with what bothered me and, even more importantly, why. Negotiation is a process during which each side tries to convince the other of its viewpoint. I then spoke to the top editor of the site and explained my concerns. In virtually every case, he had not realized the nature of a problem, including the rights transfer, because he thought that there was a provision to use the material elsewhere.

Next, the editor forwarded my concerns, noted as comments or mark-ups in the contract, to their lawyer. Eventually I got a document back with the lawyer's counter arguments. For example, when it came to copyright, the lawyer noted that his organization was in a better position to enforce infringement actions and needed the copyright to do so, which was an interesting line of reasoning that I had not heard from a publisher. In another case, I mentioned the fair use issue and he wrote, "If Sherman is contending that he is using third-party content as 'fair use,' what is the legal basis for that?" Again, a reasonable question and one that I would need to answer to get an agreement that did what I wanted.

Note that I say "did" and not "read." You always have to keep in mind what you are trying to achieve and what you are willing to give up to get there. However, given those restrictions, you must be creative in how you achieve your ends.

In terms of copyright, I countered with something that I said I'd seen at the New York Times Magazine - joint ownership. This is something I do not like to do, however, it is far better than turning over copyright and having no option to use the material. (I knew that I wasn't about to get additional money for their reuse and licensing of material.) The lawyer came back with something that I was told would be a take it or leave it position: transfer of copyright, but with the following added to the end of the rights clause:

Notwithstanding the foregoing, Contributor shall have a non-exclusive license to use the Contributor Content, and any derivative works created from any Contributor Content, in other blogs, and in books and other publications.

In other words, although I transferred copyright, I could resell and reuse the material in any other form of publishing I wanted and could create derivative works. It wasn't perfect, but good enough to make the venture worthwhile.

As far as the fair use provision, my argument that it was regular practice in blogging to take fair use quotes of news stories and blogs held sway, and any third party material was "subject to applicable 'fair use' principles," which, again, I could live with. (There was no way I would sign a contract requiring me to transfer ownership of something I didn't own.)

The entire process probably took three to four weeks - all during which I was writing for the site. Why? Because even if we didn't come to an agreement, they would owe me for what I had done and, in the absence of a written contract, my rights were extensive. The more material they had and liked without a contract, the more pressure they were under to reach an agreement with me.

I don't write this to pat myself on the back, but to make a few practical points on negotiating with publishers:

• Know what you want.
• Know why you want it.
• Know your fall back position and what you are ready to accept that will sufficiently support your interests.
• Dare to ask for everything you want at the start.
• Be prepared to effectively debate a point, with carefully reasoned arguments that use fact and logic to argue your case.
• Learn enough about applicable law to bolster your position.
• Be prepared to walk if necessary.
• Take your time in the process and present your position in writing, unless you can think quickly enough on your feet to handle a phone negotiation. (And even then make sure you've worked out your position and reasoning ahead of time.)

Trying to charm someone or make them feel guilty or complain that a given position is "right" will get you nowhere in the long run. Only sufficient fact and logic will reliably sustain you in negotiation.

A Disdainful Remark for Your Next Difficult Negotiation

The next time someone expects you to be thankful for peanuts, and you don't feel the need to curry their favor, try the following:

Oh, sorry, I think you're under a misapprehension. I'm a feelancer, not a freelancer.

Fear of Phoning: 5 Techniques to Reduce It

From time to time I see writers posting online messages about feeling afraid to call clients. Personally, I think it's a mistake to simply avoid the situation by using email for several reasons:

• Constantly avoiding what you fear only strengthens the emotion's grip on you.
• Editors often ignore email, or the messages get pushed into a spam filter, leaving the writer wondering why there is no answer.
• Sometimes the phone is the best form of communication, next to being in-person, and to avoid it is to give up an important marketing and sales tool.

I often see another writer answer something to the extent of, "Oh, but you're great, so just call. Don't be worried about it." Tell that to the person in the middle of fear. It may sound good, but the results can be exactly the opposite of what the encourager might want. Instead, here are some approaches that can be helpful. None of them require you to directly confront the fear, as often the most effective approach is an indirect one that lets you focus on intellect or action, both of which offer you far more control:

• Write it down One of the ways the fear of phoning comes out is the sense that you're babbling and sound like a complete loon. So write down all the points you want to make in roughly the order you want to make them. When you're prepared and know what you have to say, then you can stick with that, rather than trying to wing it.
• Take your time There is no rule that all negotiations happen within one sentence, let alone one conversation. Take the time you need to make your points. If someone comes up with something you're not ready for, say that you have to give it some thought and plan a subsequent discussion on the issue.
• Schedule ahead It's tought to make yourself pick up the phone when you're in the middle of fear. But the entire situation is different when you've scheduled the call and you cannot simply not bother. Use the power of your own obligation to get you on the phone in the first place, when possible.
• You can always say no You tend to get on a call to conduct a negotiation, whether over a contract, an assignment, or even the attempt to get an assignment. Fear comes in part from the concern that you won't get what you want. When that happens, invoke the power of walking away. There is no single assignment that will make or break your career and no single job that will make or break your entire financial existence. There are always other clients and other work out there; remind yourself to reduce the pressure of how much you need this particular negotiation to go through.
• Do some marketing A variation on the previous point, you can become more confident when you have more prospects. Reduce your dependence by sending off a few queries before you get on the phone. The more choices you have in work, the more control you have and, as a result, the more confidence and less fear you will feel.

Work with every intellectual and physical tool you have in a way that increases the odds in your favor and reduces the power of fear.

HarperCollins Tries to Cut Writer Advances

According to the New York Times, a new HarperCollins unit, yet unnamed, wants to substitute profit-sharing for author advances. It also will try to eliminate the liberal returns policy that bookstores have, in my view, at least, unreasonably enjoyed for decades. (In what other industry do you get to hold onto goods for six months or a year, send them back at the last minute, and then reorder to effectively extend that ability to return?) This part of News Corp. will also "release electronic books and digital audio editions of all its titles":

Author advances and bookseller returns have long troubled the publishing industry. Best-selling authors can command advances so high that publishers often come away with slim profits, even for books that are significant successes. Publishers also sometimes offer high advances to untested authors in the hopes of creating new hits, but often those gambles do not pan out.

Ms. Friedman said the new group, which will initially publish just 25 titles a year, would offer “low or no advances.” Mr. Miller, who was most recently president of Hyperion, said he hoped to offer authors a 50-50 split of profits. Typically, authors earn royalties of 15 percent of profits after they have paid off their advances. Many authors never earn royalties.

My "headline" reaction was to think, "Cut advances? Is there anything left of them to remove?" But let's take a moment and consider the pros and cons. Relatively few books actually earn out their advances, so that lump sum - often pretty measly money - has become the only sum writers see. There is definitely a risk in dropping the up-front money.

Let's consider the other side for a moment. Advances become one of the gating factors in getting a publisher to take on a title. If your main work is writing books, then, yes, you need the advance. But if you're doing books on the side, it might be that you'd have an easier time selling a title in the first place. Also, even books that don't earn back the advance are still often profitable. Now, if you sell 10,000 copies, getting half of the cover price, and you're aiming, as the article says, at about $20 for a hardcover, that is a gross of $100,000. At 15 percent before tax profit margins, that would be $15,000, or $7,500 to the writer. Not tempting, I admit. Furthermore, you get a cut of profits, so all the costs are going to come out first, and must get paid off for there to be profits. You'll see your money later than before, and now you have to deduct the time-value of money - because you're waiting, you're essentially losing about 1.5 percent or more a month (what it would take in credit card interest to cover the missing sum).

A few more problems. Royalties are hard enough to follow, and that's when you get a list of the numbers sold. But profits? How can you tell when costs are actually paid off? What is the definition of profit? That is going to be an enormous problem; ask any musician or person working in Hollywood who finds that immensely well-selling properties end up never having an official profit. Chances are greater that you'd need an audit to follow along, and that is going to cost you money unless you can show that you're being shortchanged. Contracts will get a lot trickier, because the definition of profit and what can be charged to the costs of a book will become critical. Most book agents simply are not going to have the background and experience to negotiate these terms, because they don't know where the problems will be.

Those are a lot of potential problems. Is there a positive? I'm not sure. If a book sells well, you get the split of profits, not of royalties. Here's where the flip side of paying off costs comes in. As the costs are paid, more and more of the book sales are profit. Eventually, that $10, minus maybe a per-copy manufacturing expense of $1.50 and some amount of corporate overhead (call it 50 cents), leaves you with a cut of maybe $3 or $4 per copy, rather than the $1.50 you'd make with 15 percent royalties. But I suspect you'd have to sell a whole lot of volumes to hit that mark.

There's also a problem in the reporting of the Times that might make the gains turn out to be nothing. Consider this sentence:

Typically, authors earn royalties of 15 percent of profits after they have paid off their advances.

Actually, that isn't typical at all; 10 to 12 percent is more typical, and you're talking about the money coming in to the publisher, which is more than the "profits" would be. And for hardcovers, which is what they will be doing, I'd say 7.5 percent off the cover price is more typical. That means it's really easy to figure out how much someone owes you.

The upshot is that things are changing quickly, and you're going to need really good advice - from a lawyer, and maybe even an accountant - as you go into book deals. Forgo professional advance, and you're likely to make a deal which leaves you with less than ever before.

Using Information to Leverage Negotiations

Sometimes negotiation seems like a big hole that you have to fill, but you don't know with what. But a little bit of research, or even something you already know, can give you the edge you need. Here's a recent example I had. Although most of my work is in non-fiction, I write plays and had submitted a short one to a publisher that I knew was looking for material to go into a new anthology for actors. Six months ago I sent in some work, as it literally wasn't going to hurt anything I was doing, and might be an opportunity.

The other day I received an email from the editor of the book, saying that she wanted to include my play. Payment would be either $30 or five copies of the book. It sounds like an iffy deal, but I did some research, calling a playwright I know and asking if he knew the publisher and what he thought of the rates. He's put together at least one anthology in conjunction with the Kennedy Center in D.C. and said that they paid about the same, noted that the publisher was reputable, and echoed my own thought: it can't hurt, and it might help. He also suggested taking the money, because it could offer proof to the IRS that I actually am doing work in the dramatic field. A very smart suggestion.

But I still wanted copies of the book. I checked at Amazon.com and found that these books pretty much sell for list price wherever you find them. The publisher obviously was valuing the five copies as the equivalent of $30. However, I've done research into book publishing in the past and know that the actual unit cost of the book is probably going to be in the $1 to $1.50 range. So I made a counter offer: $25 and two copies of the book, indicating that I knew the marginal cost. Their answer? Sounds good. So I get a couple of copies and I also get the $25 to help establish a track record as a paid dramatist.

Had I not done the research into the offer, I would probably have agree anyway and picked either the money or the books. But I knew that the worst that could happen was the editor said, "Sorry, it's one or the other." But with the facts backing me, I also knew that they were still saving money over the straight cash payment. Although this is a small example, it shows the important principle that the more you know going into a negotiation, the smarter you can negotiate.

Hold the Response

When you're pitching yourself - which, if you're a working writer, is virtually every day in some way or another - you'll find times when someone doesn't seem interested, or doesn't seem to get what you're saying. There will be days when the temptation to snap back and the ignorant putz will be great. Refrain, as you'll only do yourself ill.

The other day I had a couple of Profnet queries out, and I got a response from someone whose pitch didn't grab me for the particular story I was writing. When I replied, he asked why, and I told him. "You've got me laughing," he said, going on to explain how I was wrong. And the guy was promoting a book on marketing. My reaction? Who the hell are you to say whether something is actually a fit or not? I replied in a rather terse and sarcastic way, and he was smart enough to apologize. He said that he had meant it humorously - and maybe he did. Maybe he didn't. It wasn't for me to judge, but I did appreciate the gesture, and he saved a potential future relationship, or at least opportunity.

Not all do. Sometimes you'll find someone, usually not a PR professional, react. The minute that happens, the person cuts himself or herself dead. It doesn't matter whether you're talking to a journalist, editor, or corporate buyer; the mechanism is the same. When you feel that urge rise, fight it down and substitute something more useful, like, "Thanks, maybe next time."

That doesn't mean there's never a situation in which you answer back, but it's rare. There are only two circumstances I can see it happening. One is when people are so outrageously abusive that for the good of society you must make them understand that they cannot walk over people with impunity. I've seen many writers talk about abusive contacts, and personally I suspect that perception is exaggerated. Abusive isn't someone being short or even insensitive - it's a level of harangue or attack that is hard to miss.

The other situation is when you are absolutely sure that an idea you have would be a fit for someone. Under these circumstances, you go back, apologizing and indicating that if it's really not of interest, you'll drop it, but you're sure that you failed in your description, because you see a clear connection, and that you'd appreciate another chance. This also should be extremely rare. If you find yourself doing it more than a couple of times a year, there is something wrong - either you are pushing your ideas into places that really are not a fit, or you're dropping the ball in your initial explanations.

Except for these rare times, learn to lose the battle so that you might come back to the same field another day.

The NYT on Economics of Television and WGA Strike

The New York Tiems has some interesting pieces, with different takes, on the WGA strike, and I pass them along as worth reading. One, on how superstar producers, directors, and actors, are sucking much of the profit out of the movie system, may or may not be completely accurate. It's based on a report completed for an analyst firm, but by a former studio person, so there might be some bias in the analysis. Then again, it might be accurate.

This article shows how the image of Hollywood writers being highly paid is a generalization based on a few big names. Most writers, it asserts, are getting by, but hardly rolling in dough. And here's an article on how the writers are finding print and web outlets while they wait for their work to get back to the screen. Just what you wanted: more competition.

A Comment on Writers Guild of America

Whenever news of Hollywood writers appears, there are usually a number of freelancers who experience envy: Why don't we have someone protecting our rights, getting us money, and so on? I have nothing against WGA West (the Hollywood-oriented division) at all, but freelancers need to realize that the circumstances are night and day in their differences.

WGA came out of the studio system for movies and television, and so had a tradition of the writers being employees. That's what allowed them to form a union in the first place, because US law prohibits independent businesspeople from forming unions. (I believe it historically comes from concerns about monopolies and price fixing.) But even today, the writers are technically employees - temporary, to be sure, but employees, nevertheless. Producers and studios have to deduct taxes, they pay money for benefits to WGA - and they, not the writers, own all pretty much all the rights to the work. For those who have never looked at a WGA standard contract, it's an informative experience. Notice that the writers are going on strike to get more income from additional uses of their scripts. The reason they're going on strike is because they don't own the rights in question, and, so, cannot force an agreement in other ways.

Some rights - like publication and the right to reacquire a script - do come back under specific circumstances, and you can see some of that here. But the rights that writers have to convey are extensive. The trade off is for money and benefits. In other words, if you think that being a WGA writer means getting the best of all worlds, you're not being realistic. When you're in business, you have to make trade-offs, and that's true whether you're writing an article or a screenplay. Indulging in wishful thinking and wanting an organizational knight in white armor to protect you doesn't get you anywhere and only breeds resentment. Instead of pining for what isn't, take your energy and focus on what it - the opportunities you have to negotiate contracts, to work with companies that are giving you what you think is a reasonable deal.

Create a No-Wordsmithing Zone

I hate the term wordsmithing - I have since I first heard it as a professional writer. The word, and the attitude it represents, are dismissive, placing the process of writing on the level of clever assembly line operations. You take what the client gives you and "massage" it until it reads better. There is that unspoken assumption that the writer adds window dressing only.

Of course this is absurd. Writing is about analytic thinking, the absorption of information, the analysis of this mental material, and the design and construction of an intellectual road map that can get readers from point A to point Z while leaving them feeling more intelligent than when they started reading. Of course they feel smarter: suddenly they grasp something. however, it's the writer that does the heavy lifting and leaves a paved path where once there was bramble and brush.

There was a time that I didn't flinch when I heard wordsmithing. That is no longer the case. When a client uses that term or something similar ("The document only needs a little editing."), I disabuse them of the notion. When a corporate client plays the editing card, I say, "No, you're looking to condense material and to find the most important points. That's not editing; that's writing." When an editor sits on an article for weeks and then suddenly surfaces and says, "I need this changes," I say, "That's fine - I can get them to you in X number of days."

The more you remain quiet when a client effectively dismisses what you do, the more value you help drain from your services and the lower you set your price. The next time someone asks you to wordsmith, point out that you don't polish words like so many pieces of silver plate. You're a writer, and the work takes time, skill, and proper compensation.

Watching Vague Contract Terms

Yesterday, I had an email exchange with a colleague who is very active in negotiating contracts and in writers issues. The topic turned to vague contract terms. it's a big problem in many contracts. A contract will seem to state something, and yet when you look closely at the wording, you see that much is left up to the imagination, or later argument.

A good example, as I often mention, is the term "acceptance." Many writers are satisfied when they see payment on acceptance in a contract. And yet, what does acceptance mean, when does it occur, and who at a client (whether a publisher or other corporation) must provide it? Does acceptance happen when the writer's contact thinks the piece will work? Does it happen after the questions have been answered? After final approval of the piece right before it's about to be used? We've just gone from acceptance happening shortly after the client reads the first draft to some time after a second or later draft, to effectively on publication. You can find such problems in rights clauses. For example, what does "electronic rights" actually mean?

Not everything in a contract can be pinned down to something that neither side could dispute. Courts recognize terms like "reasonable effort," though there is no hard and fast definition to which you could point. But much in contracts is hazy, and the miasma can lead to a cloudy future in a future dispute.

Reading many hundreds of contracts between the two of us, we're both convinced that most of the problems are not the result of lawyers' conniving, but of sloppiness and ineptitude. What lawyer wants to explain to a boss that he or she didn't nail down the terms of a contract in an unambiguous way? The bell curve applies everyone, and just as many lawyers are below average as above. However, that doesn't matter, because if you sign the mistake, you're stuck with it. Writers need to learn to read contracts - go through the language carefully and read it literally. Don't gloss over anything, and don't excuse yourself from asking the necessary questions by saying that you can clear them up in an email. You won't end up sending the email, and even if you do, it's the contract itself that you signed.

Address Problems When They Arise

A noticed a writer discussing a situation that has become too familiar - after taking an assignment and signing a contract, the client wants to change the terms. That in itself isn't necessarily unreasonable. Both you and the client (whether a corporation, a non-profit, or a publisher) anticipated certain conditions, but the client has realized that it made a mistake or that a situation had unexpectedly changed. Each side needs to remember that business, as well as life, has its twists and turns, and sometimes you need to be flexible.

However, changes may have an impact on how you and the client will work together. It may be that your contract addresses that; for example, it might provide payment by length, with additional material generating additional revenue. But what if someone wants to cut an assignment after you are in it and have committed the time that can no longer be contracted out to another client? Does the contract specify a minimum flat fee? Is there an expectation that as the scope drops, your pay drops? Does a flat fee bring into question whether an expansion will gain increased payment?

It's normal for questions to arise, and the time to bring them up is when they occur. Do not continue working until you resolve them. In the case I saw mentioned, the writer was asked to provide more material with an editor saying, "Oh, don't worry, I'll cut it down." Then, suddenly, the editor decided to run something twice the length and now, supposedly, had to get the top editor to authorize something. More likely, the editor in question was hoping the writer wouldn't say anything, and once the writer did, was now caught and didn't want to bring the situation up with the EIC. I had this happen recently with a corporate client that wanted to pretend that some commissioned work didn't happen, asking to be billed for one part and not another.

You cannot let this sort of situation pass, even if you think that you will permanently lose the client. Not only do you set a precedent, but you will feel terrible for letting yourself be bullied. There is a world of clients out there, and no matter what the size of one, you don't need to do business with it. Bring up the problem when it arises and don't meekly accept your fate.

This reminds me of a story an academic and consultant told me of a small manufacturer doing business with Wal-Mart. Over a few years, the retailer pushed for one concession after another. Eventually the small company said, "We're sorry, but it's no longer profitable for us to do business this way," and it walked away. The tiny margin on the volume didn't make up for all the hoop-jumping. Wal-Mart pointed out that it could find another supplier, and did. Interestingly, though, a couple of years later, the chain went back to the manufacturer, asking if it would be willing to take the business under better terms. What happened was that Wal-Mart had forgotten what the small company had remembered - that you have to look at the value of the entire relationship. When it went with another vendor, there were huge customer service problems that increased the overall cost of doing business, no matter how cheap the products seemed to be. But even if Wal-Mart hadn't come back, the company would have been better off, because it didn't back down from what it knew was its own interest.

Whether a client comes back or not is immaterial. There is more to life than money, and to keep your own self-respect, treat your business dealings as though you have the right to equitable treatment. If you won't, no one else will, either.

Go Ahead and Negotiate

I've seen on a couple of writers' boards recently news of freelancers being successful in negotiating with magazines. In one case, it was a writer pushing a major publication to significantly change contractual terms - and being told that most writers didn't bother to even ask. In the other case, someone pushed to get an assignment up from 50 cents to 65 cents a word.

No matter where you are in your career and no matter whta the circumstances, you can always negotiate and improve a business deal. There is almost never a downside to at least asking for what you want, and often you'll get at least a significant portion. That happened with me last week when a book publisher gave in on a number of terms that were bothering me. You won't know unless you try - and the more people try, the more pressure the publishers are under to change the way they do business.

It's popular to think that writers are a dime a dozen, and often publishers seem to think that way. But the smart ones know that they need ideas, and stories, and writers who can bring all of it together. Don't ask other writers what you can and cannot negotiate - find out by pushing in a pleasant and business-like manner. The companies that are unprofessional enough to walk away if you even dare ask for changes are the ones you don't want to do business with. The others will give in at least some, and possibly more than you realize.

On Rate Cards

I recently took part in an online conversation about rate cards. A writer had a client asking for one and didn't know what to put on it. My suggestion was to avoid rate cards entirely. When clients ask for rate cards, what they really seek, whether they think of it this way or not, is control over what you do and how you charge.

An hourly rate could potentially vary depending on the nature of the project ... and the client. And how can you quote a project rate when you don't know anything about the project's details? Recently I was asked for a corporate rate and I mentioned a range within which I'd typically work, but I can't offer a single number Some projects rquire me to deliver more value - not time, but value. They may require specific expertise or information. Why should I offer that at the same rate a simple press release or front of book article might take?

If a client wants something that completely predictable without offering any details as to what the work entails, then perhaps finding another client would be the best thing.

The Power of Silence in Negotiations: Part 2

Yesterday I mentioned the theory of keeping quite in negotiations. Here's an example based on a negotiation I recently did; the details are changed, but the essence of the conversation remains the same. Background: the client had talked about a starter rate, which I remembered. I had just completed a second assignment, and had been paid for the first but found that the company was messing up the second. Also, after my simple statements, I kept quiet and let the pressure build:

Erik: "I do need to get this pay issue straighted out."

Client: (embarrassed) "Yes, I know, I'll get to work on it - you did a good job on it."

Erik: "Oh, and I was also remembering that you had mentioned $1.50 as a starting rate."

Client: "Oh, right, I did. What do you usually get?"

Erik: "For this sort of work, it's a bit over the map, but $2 a word and more is hardly unheard of."

Client: "Usually I only pay $2 a word to subject experts who also happen to be able to write clearly. It makes life a lot easier on me. I see that as kind of the top of what I can do..."

Erik: "Tell you what, let's go to $1.75 for now. But I am providing some pretty good topics and solid stories to you, right?"

Client: "Yes, you are."

Erik: "So I want to keep the option open to return to the topic at a later date."

Client: "Ok, so the new assignment you're about to start will be at $1.75 a word."

I had the sense that she was putting her back against the wall on the $2/word, which is why I went to what I did. But I left the negotiation controlling the future and will be able, in another few stories, when she's really hooked on what I'm doing, to emphasize what I bring that the technical experts don't and push for more. Also, by making statements and then keeping quite, I added pressure to her and took the upper hand.

You do have to keep yourself under check and be willing to let the pressure sit on the client. If you let the tension get to you and start talking to let the person off the hook, you could find that you talk your way out of whatever you were hoping to gain.

The Power of Silence in Negotiations: Part 1

One trick that many practiced negotiators use will sound familiar to any journalist: keep quite and let the other person talk. In an interview, the practice often results in the interviewee becoming uncomfortable and beginning to say all sorts of things to fill the dreaded quiet. In that rush of words, you can pick up gold.

In negotiations, the gold you pick up can be more the folding currency type. Although a good negotiator won't get rattled by this, you'd be surprised at the number of people in corporations and pubications who really are poor negotiators. That is one reason you'll hear things like "the lawyers make us do this," because they really are sweating bullets. In negotiating, though, you go one step further. You want the other person not just to talk, but to talk first, at least in terms of substantial issues. When it comes to discussing rates, for example, speak up long enough to ask, "What is your budget for this project?" or "How much do you typically pay for this sort of project?"

You might get someone pushing back, asking "What would you charge?" or "What do you usually get?" But usually the person will start spilling inforation that is useful. You might learn that the rate is absurdly low from your view, which means you'll have to structure the conversation one way. Or it might be that they're open to larger fees than you realized, and then you continue the negotiation another.

There is a great story about how this technique can work. Thomas Edison and his advisor had brought the inventor's latest device - the ticker tape - to a famous banker. They asked how he might be able to use such a machine, but they already knew what the answer would be. The information would let the banker react more quickly and beat out competitors.

The banker offered something like $5,000, a considerable amount of money at the time. Edison and advisor kept quite. The banker - and mind you, this person would normally be an expert negotiator - immediately offered more and was greeted by more silence. This happened a few times until the guy offered something like $150,000 and said it was his final offer. They accepted and signed and the banker gloated becaue he had been willing to go as high as $175,000 or so. Edison told him, "I would have settled for $10,000."

When it comes to negotiations, silence is your friend. Tomorrow, I'll show an example from my own recent experience.

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.

There Be Business Monsters

I recently read of a writer who was working for a publication at a fifth her normal rate because the editor mentioned the possibility of a regular job with them. At the end of the first assignment, suddenly the job was no longer a possibility – at that time, of course. But the editor liked the writer’s work and wanted to use her again, though there wasn’t as much money available for the new assignment. And the job might just be available in the future. So the writer debated taking it the second assignment.

Welcome to the real world of business, boys and girls. No matter how “nice” this editor seemed, she was shameless playing the writer three ways from Sunday. I’ll entertain the benefit of the doubt that she might have been acting unconsciously, but my money would be on her knowing what she was doing each step of the way. In fact, I'll go so far as to state that each and every one of you, possibly recently, has been manipulated by a client (editorial or corporate) that you liked.

That's not surprising. We're all human and we all manipulate others to some degree or another. But many people drop their usual scruples and constraints when it comes to business negotiation. You might hear, "Oh, don't worry, just write it long and I'll take care of it," which translates into, "Give me more material so I can pick and choose, and I'll happily reward you by paying no more than I need to." It could be, "Why, no one has ever had a problem with our contract." Or how about this one: "I'm sure accounting lost the invoice. I'll get on it right away."

Such people are trying to get what they want from you while keeping their budgets in control. Don't be surprised: It's what they get paid to do. Top that with wanting to avoid an angry outburst from someone ill-used, and you've got a monster client.

The real problem for many writers, however, is wanting to believe that the client is a friend. But a friend hopefully wouldn't ask you to put aside your livelihood as a favor one month, let alone ask you to do it again the next, all so the friend could benefit. With friends like that, who needs enemies? It's just another reason to take the emotion out of the business.

The Passionless Pursuit of Profit

I'm going to mention a few situations that writers often find themselves in. See if you notice what is common - or if you can see yourself in any of these situations:

• I'm so mad! I've sent yet another email to that editor and haven't gotten a response. If they want queries, why don't they have the courtesy to reply?


• The pay is really low, but I really like the editor and I want to keep the relationship.


• I really need this assignment, so I can't try to get changes in the contract, because I can't afford to have them decide not to use me.


• I'm so excited! I'm in the running for a big project. Oh, I really, really hope I get it!

The common thread is unrestrained emotion: anger, desire for friendship, fear, and excitement. Obviously there is nothing wrong with emotion, per se - it's a human characteristic. But when you go into business dealings from an emotional framework, you are toast facing a world of sharp knives and orange marmalade at 8 in the morning.

When your emotions run like a roller coaster through your working days, you will end up battered (if not buttered). Here are the possible outcomes:

1. Everything moves towards being a high or low, yanking you this way and that and making work much more difficult.


2. You create a sense of neediness in yourself and broadcast it to all around you. When that happens, you will come out on the losing side of any negotiation, which means any conversation with a client. If you cannot even consider walking away from the deal - the very definition of neediness - then you cannot improve it because the other party doesn't need to change a thing.


3. The emotional reaction causes you to take everything personally. That clouds your vision. Instead of seeing business relationships, you see personal relationships that really don't exist (no matter how much you like most of your clients). That puts a burden on your clients, who really aren't your best friends and shouldn't have to be. It also keeps you from treating them in a way that is appropriate and respectful.


4. When you react from emotion, you start making assumptions that may or may not be valid. That can lead you to expecting revenue from assignments that won't end up happening or not taking the extra step that might actually result in work that you've presumed is lost.

We all need to learn to take the emotion out of our dealings, and this is a day-at-a-time process. Start with reserving judgment. When you find yourself ready to jump for joy or sink into despair, tell yourself that you don't really know what it going on outside of yourself ... because you don't. It may be that something good will come of a conversation, or perhaps not. Eventually you'll see.

Also, very few of us are in the position of being in life-and-death situations. There will be other clients and other assignments. If you work hard at marketing, you'll get enough possibilities that some of them are bound to fall into place. Make it a matter of numbers, not a matter of how you feel that day.

Finally, for today at least, keep your work and home lives separate. Be cordial with clients while remembering that you aren't looking for friends and don't expect them to serve that function. When you need to make a hard decision, then it really is just a matter of business. Save your passion for your writing; use your head in your business dealings.

Personal Jurisdiction Term in Contracts

Although I'm not quite as available to do contract reviews as I was when on the ASJA Contracts Committee, I still do a few. A recent one presented something I had never before seen: personal jurisdiction.

I just looked up the phrase "personal jurisdiction" on Lectlaw.com (a free legal dictionary). Here's what it says:

If the court is being asked to determine any defendant's rights or obligations, it must have the power to make orders concerning the individual defendant. This is called personal jurisdiction. Personal jurisdiction is also called "in personam jurisdiction."

For a court to have personal jurisdiction over a defendant, the defendant must have been personally served (or have accepted service of the court papers) and the defendant must have at least some contacts with the state in which the court is located. No set number qualifies as the minimum; each situation must be analyzed case by case. If the defendant lives out of state, the court must look at the defendant's contacts with the state. Going into a state regularly to conduct business is usually sufficient for the court to obtain jurisdiction; sending child support payments to a state, without actually visiting the state, however, is not.

That explains why a publisher might use the phrase: if both parties agree to personal jurisdiction, it makes it difficult for you to take legal action if and when necessary.

First, you have to pay to have the publisher personally served if you’re suing them for anything, like not getting paid. Next, the publisher will argue that it doesn't go into your home state so that you’d have to go to its state to seek your money. This is far more expensive than suing in your own backyard (which is potentially expensive for the publisher). Usually when a company wants to try for this sort of restriction, it asks for you to agree to legal jurisdiction on its home grounds. (The contract may use the word jurisdiction or might use something that is equivalent, like agreeing that any legal disputes will take place in a specific city, county, or state.)

Using personal jurisdiction is the most backhanded way I’ve seen this pursued. My personal take is that if I think a publisher is trying to sneak one past me, I also assume it will try to sneak other things by, and I walk away and seek better business partners.

When Things Go Wrong, Negotiate

Yesterday I mentioned that when things are going well, you should continue marketing with a focus on things you might not ordinarily do. When things go wrong, yes, you market, but you might also consider negotiation. Instead of taking whatever life deals out, see how much you can change more toward your advantage. I had a real example happen yesterday when a publication decided literally at the last minute because of a mix-up on its end that it needed substantial changes to a story. It was pulling the article from the current issue and now the piece was no longer accepted. I did start gnashing my teeth and began writing an email to the editor because I couldn't afford to disrupt my cash flow further than a couple of previous setbacks had already done.

I started the email a few times - got a line or two in and tossed it. Remembering my goal - to get money - I knew that venting at the editor would do no good. So I carefully crafted a message saying that we needed to talk and that while I understood there was a mix-up on the publisher's side because I got the go-ahead from someone new who hadn't known of the history of covering a given topic, I couldn't add another invoicing cycle on top of what I had already waited.

That was the first part of my negotiation strategy - because I wanted a practical resolution, not the emotional satisfaction of screaming at someone. Next, I said that if we could work out payment issues, I'd be happy to do a few extra interviews and the rewrite "to reflect what is now a different angle and article." I was clearly indicating that additional pay over the original fee might otherwise be in question. Could I have held out for more? Sure, but I was considering the most important goal in this case - while realizing that it would largely be a case of reslanting much of what I already had in a somewhat different way.

Later that day I received a counter-proposal - a one-third "kill" fee immediately, and the remainder on rewriting the article. Because I had overbooked revenue above my target goal, I could agree to that, maintain a relationship that I expect to be a profitable one (I already had a second assignment and had negotiated a 20% rate increase between the two), and still have the cash flow for the full goal, with the extra to follow in the future. So I agreed.

Did I get everything I wanted? Of course not! But did I get what I needed then? Absolutely. And if that hadn't done it, I would have looked at other possible negotiation strategies. Negotiating out of a problem won't always work - it didn't do a thing when early this year I had a client declare bankruptcy. But it's a potential tool that might get you out of a jam, so don't assume that you only use negotiation before you start an assignment. Any time an issue comes up - payment, or maybe a sudden change in an assignment or deadline - negotiation is useful. And it's a great deal more effective than tying yourself up in knots or posting on a writers' board how angry you are with someone.

One Time to Ask for More than Enough

I'm a firm believer in understanding your own bottom line pricing based on your business needs and on value pricing - charging for the value you can deliver, and not the time you spend. But even then there can still be a gap between what you'd charge and what the client might be willing to pay on the upper end. I was reminded of this a couple of times this last week. Once was for a speaking engagement, when I quoted a significant sum, as I'd be out of the office for at least two days in traveling and through that it would be a discouragement. It wasn't and now I find myself