Serpentem comederit

In today’s publishing news, dragon eats serpent; writers get ripped off. In other words, business as usual. David Gaughran reports at IndieReader:

Penguin’s New Business Model: Exploiting Writers

Penguin’s parent company, Pearson, has announced the purchase of Author Solutions for $116m – news which has shocked writers, especially given Author Solutions’ long history of providing questionable services at staggering prices.

Author Solutions are the dominant player in the self-publishing services market – via their subsidiaries Author House, Xlibris, Trafford, and iUniverse – and had been looking for a buyer for several months. According to the press release, Author Solutions will be folded into Penguin, but will continue to operate as a separate company. Penguin’s CEO John Makinson stated:

“This acquisition will allow Penguin to participate fully in perhaps the fastest-growing area of the publishing economy and gain skills in customer acquisition and data analytics that will be vital to our future.”

What does Author Solutions bring to the table? Well, for starters, around $100m in annual revenue. Roughly two-thirds of that money comes from the sale of services to writers, and only one-third from the royalties generated by the sale of their books.

Pause for a moment and consider that statistic. Penguin isn’t purchasing a company which provides real value to writers. They are purchasing an operation skilled at milking writers.

. . . . . . . . . . .

Before they leave the clutches of Author Solutions, however, writers are subjected to never-ending phone calls hawking a string of overpriced, useless services, including the press releases described above. As such, the average customer spends around $5,000 over their “lifetime” with the company, but only sells 150 books.

Author House, Xlibris, Trafford, and iUniverse — the four horsemen of the vanity-press apocalypse — join Penguin’s own little stillborn foal, Book Country, which provides the same kind of ‘services’ for similar extortionate prices. According to Penguin’s press releases, the idea — or what they were selling as the idea — was that Book Country would become Penguin’s farm team, the place where they would groom new and promising writers until they were ready to join the exalted Penguin stable. Either that, or, you know, they would bilk fools out of every penny they could get, and never come within a million miles of giving them a real publishing contract.

In other words, writers were sucked into paying thousands of dollars to Penguin by the false promise that one day they might get a pittance from Penguin.

Evidently Book Country wasn’t doing its job; the marks weren’t falling for it in sufficient numbers. So Penguin hired the real experts. Author Solutions and its assorted vanity ‘imprints’ have managed to snooker 150,000 writers in their history, for an average take (so Mr. Gaughran informs us) of about $5000 per writer. Blogger Emily Suess has compiled a list of recent complaints about iUniverse’s scams. Writer Beware, Preditors & Editors, and other well-known writers’ advocacy sites offer abundant warnings against each head of the Author Solutions hydra.

If you think the Penguin is going to marry ASI and make an honest woman of her, think again. Kevin Weiss, chief executive sleazeball at ASI, is not only being confirmed in his position as head of the acquired company, he is reportedly going to be installed on the Penguin board of directors. Meanwhile, Penguin and its parent company, Pearson, are all aglow about their acquisition. Here’s an especially fulsome bit of puff from the press release:

The self-publishing sector has also become an important source of talent and content for the publishing industry, producing several bestselling authors including Lisa Genova, John Locke, Darcie Chan, Amanda Hocking, Bronnie Ware and E.L. James.

Now, isn’t that special? And every one of those bestsellers came out of the Author Solutions machine. No, wait a minute, let me fact-check that. None of them did. In fact, I have never seen any evidence that any bestselling author, self-published or otherwise, has passed through iUniverse or any of ASI’s other units. No, Genova, Locke, Chan, Hocking, Ware, and James, and many others, are self-published writers.

Note that word self. That means they were not ‘published’ by iUniverse. They were not ‘published’ by Xlibris. They were not ‘published’ by Author House or Trafford. They did not pay thousands of dollars up front to a scam operation which then ‘published’ their works for them, with minimal distribution and no promotion, and pocketed half or more of the profits after the writers had paid the up-front expenses. No, what these writers did was much simpler. They published their work themselves. They paid one-time fees, in some cases, to editors, cover designers, and other skilled professionals; they arranged their own distribution deals with retailers like Amazon, B&N, Kobo, and Apple, or went through aggregators like Smashwords for a modest commission. They paid the market rate for the services they needed — not the market rate plus a fat profit for ASI — and got the entire wholesale price from their ebook sales — not the leavings after ASI skimmed the cream.

For anyone at Penguin or Pearson to claim that what these writers did for themselves bears any colour of resemblance to the scams run by ASI is unconscionable. It is a barefaced lie. It is the mephitic effluvium of a fuliginous soul. You can very nearly smell the stink of brimstone just by reading the words on a computer screen.

We already knew that Penguin was one of the unrepentant defendants in the Justice Department’s price-fixing case — one of the three (out of six) who refused to settle on the DoJ’s proffered terms. The evidence is clear and abundant and public that they entered into collusion with the rest of the Price-Fix Six to jack up prices, dictate terms to retailers, and bilk the reading public. Now they have acquired a company whose sole business is to bilk writers.

I can only read this news in one way: Penguin have despaired of ever making a profit by doing honest business, so they have decided to survive by fraud at both ends of the supply chain. Rip off the readers, rip off the writers. And they really seem to believe that this will keep them in business.

Let the buyer and the seller beware. This dragon has teeth at both ends.

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