Historical and Contemporary Romance Author

Major Publishers and the No-Advance Digital Model: Thanks, but No Thanks

It can’t have escaped too many authors’ notice that most of the major publishers are opening digital-first/only romance lines. Harlequin was first out of the gate with Carina Press, but now we have Avon jumping into the game with Avon Impulse and Random House with Loveswept. I’m sure the other major houses can’t be far behind. There’s a lot to be said for the digital first/only publishing model in this age of shrinking shelf space and expanding digital book sales. Why shell out for a print run when orders for print books are declining and you may even take a bath on the book if one of the big boxes (Walmart or Target) decides not to stock it? Better to test the waters in digital first and, if the book does really well, cross the author over into print when you’re more certain of the return on investment. And romance readers have clearly been the early adopters on this front. Digital books and romance readers are a match made in heaven because we like to read a lot of books and we want them yesterday.

But there’s a catch, and it’s a big one, in my opinion. With the exception of Carina, it appears that these new digital lines being created by the major publishers are picking up books and authors for these new lines with no advances and a royalty rate of 25% of net. (The royalty rate sometimes steps up to as much as 50% of net after a certain number of sales, but these sales numbers are usually in the 10,000+ range.)

Now, 25% of net is pretty standard when you sign with a major publishing house, but usually, you’re getting that lower rate in exchange for print exposure AND an advance. The publisher is making a significant upfront investment and taking the lion’s share of the risk in traditional print deals, both because they’re giving the author a guaranteed minimum royalty payment in the form of the advance and investing in the print run and print distribution, not to mention the possibility of returns. From a business perspective, it’s reasonable for an author to take relatively low royalties in exchange for a guarantee that, even if the book tanks, he/she will never receive less in payment than the advance.

When digital publishing first started catching on, one of the things that made the no-advance model work was that, although there was no advance, the royalty rate was much higher. The publisher was taking much less risk by giving no advance, but there was no cost to the author to produce the book and the potential earnings if the book did well were much greater. Even so, back in the day, there was a LOT of skepticism about the no-advance digital model. RWA and many authors looked askance, viewing it as a too-risky proposition because there was absolutely no guarantee that the author would ever earn any money at all. For quite a while, RWA refused to “recognize” digital publishers like Samhain and Ellora’s Cave because there was so much uncertainty associated with earnings.

That uncertainty in digital publishing hasn’t gone away. There’s still no guarantee that a digital book will sell enough copies to earn the author a decent amount of money, even at the higher royalty rates offered by small digital presses. Which is why I’m baffled by the insistence of the major houses on maintaining that 25% of net on royalty rate for these digital-first lines. (Again, I’m not including Carina in this rant, as their rates have always been more on a par with the other digital presses, and from what I understand, they recently raised those rates.)

Let’s see if I have this straight, shall we? You are not going to pay me an advance for my book, so you are not going to guarantee me a minimum payment. In addition, you won’t be investing in a print run or physical distribution for my book, thereby significantly cutting your production costs. But, because you are (Insert Big 6 Publisher Name Here), I should be happy to accept the exact same royalty rate for my books as authors who are getting both of the benefits? Hmmmm, forgive me if I’m not impressed.

And here’s the real kicker–the way I see it, within five years, most romance will be published as digital first. If print is available, it will probably be POD. And this will be true of books put out by the Big 6 publishers. Unless a book is “big enough” to be stocked in Walmart/Target, it’s not going to HAVE a print run. That’s just the reality of what’s happening to the book market. With Borders gone, B&N committed to the Nook+Nookbooks as its primary source of revenue growth, and more and more people getting ereaders/tablets/smart phones, print is fast becoming an inefficient and not even particularly desirable method of delivering book content. If I want a print book now, I have to go to a store and buy it or buy it from an online retailer and have it shipped. If I want a digital book now, I can have it. NOW. (Well, unless it’s only available for pre-order, but details, details.)

So, what I foresee is that publishers will start pushing their current midlist authors into these digital lines in addition to attempting to acquire new authors for these lines. It remains to be seen whether they’ll be successful at keeping authors on, though, if they offer such poor royalty rates and no advance.

All I can say is that, if I were a Big 6 publishing house and I planned to launch a digital line, I’d be thinking about offering either a royalty rate to match the digital small presses or a modest advance. But I wouldn’t count on my big name to convince authors to take it on the chin when they have other options.


  • Bev December 22, 2011 at 3:37 pm

    Um, yes, yes, and yes. I agree.

  • Jessica Scott December 22, 2011 at 3:58 pm

    Hi Jackie

    I was the first acquisition for Random House’s Loveswept and I can absolutely say I was paid an advance for each of the 3 books I signed with them for. For me as a debut author, I was over the moon to be offered a contract from RH.

    I read a Courtney Milan post a while back about why she chose to self publish her novella and one of her comments stuck with me (I’m paraphrasing badly here): she was surrendering print availability bc even with her traditional print contract, she couldn’t guarantee that readers could get her books in print.

    I fully agree with your assertion that the majority of romance will be digital first/POD in the future and I don’t honestly see where that’s a bad thing. The problem – again, newbie here – with the current model in publishing is there are print orders made by the publishers and if those books don’t sell, they’re stripped and dumped but the publishing house (read the author) takes it in the shorts b/c without the physical books to sell, the publisher can’t redistribute and the author can’t earn back the advance. If authors can’t earn back their advance, sooner or later, the business side takes hold and publishers can’t keep publishing the author. While I’m sad that readers in my hometown can’t run to their Mr Paperback and purchase my book, I’m also pragmatic in that even if they could, would it justify the huge overhead for the publisher to go to print on an unknown product (me). It’s a smarter business decision for the publishers to test the waters first and build reader base before moving into more expensive investments (again, as I understand things). I’m pretty sure this is something similar to what Samhain does, isn’t it: where a book has to have a certain threshold before it goes into print?

    I think the crux of your post is how are big publishers going to continue to keep authors if their royalty rate suck? I’m not sure anyone can answer that question right now. I think you’d have to ask more authors than me why they chose to stay with their publisher or what would make them leave? My team at RH is more valuable to me than a royalty rate: the editorial input alone is beyond invaluable to me; their support of me as a soldier and as a writer is amazing. I’ve got a good team behind me. Would I leave if Amazon or someone else offered me a higher royalty rate? Their money is worthless to me if the team behind me isn’t what I’ve got right now. What good would a 70% royalty rate do me if I’m miserable, hate my editor or am being hounded for a product when I’m getting ready to deploy my company? Those are the intangibles that go into the decision making process for me. Every author’s situation is different and my understanding of the business/publishing world is still thin at best. But for me, it’s a business decision based on where I am as a writer right now, if that makes sense.

    Thanks for a great post! It raises a lot of good points. Just wanted to correct about the advance info☺

  • Jackie Barbosa December 22, 2011 at 5:31 pm

    Hi Jessica,

    When I mentioned Loveswept as not offering advances, I did so only because that was my impression from what I had read/seen about the line. So the fact that they ARE paying advances for digital only releases is very encouraging to me. That said, I know a LOT of authors who have been offered contracts for digital only books by publishers for lines that either exist or are in development, and NONE I’ve spoken to were offered an advance. So that’s where I was coming from.

    The crux of my argument wasn’t so much that publishers needed to raise the royalty rate but that they either need to do that OR offer an advance, because if the royalty rate is the same as what you’d get for a print+digital deal but there’s no advance, it makes a lot more business sense to go with a different publisher who offers a better rate. All other things being equal (i.e., reputable publisher, editor you can work with, etc.), if you’re offered no advance and 25% of net or no advance and 50% of net, you should probably take the second.

    Rest assured that I was not in any way attempting to suggest that everyone should hie immediately to self-publishing because the royalty rate is 70%. Rather, I was suggesting that if I were a publisher and I knew I was in competition for good books with publishers who were offering much better royalty terms than I was, I would be concerned about attracting and keeping authors.

    At this stage in my career (such as it is), I wouldn’t take a 25% of net and no advance deal from a publisher. In fact, I probably wouldn’t take any of the deals that I did take, lol, even those that included advances. But I’m not sorry I took the ones I did, either.

    You’re absolutely right that our needs are different at different stages in our careers. But publishers need to be aware of that and know that how much we want/need them is directly proportional to how much they can/will do for our career growth at any given stage.

  • Cassi C December 22, 2011 at 9:10 pm

    Super interesting info, Jackie, and wonderful food for thought!! Thanks!

  • Marsha Altman December 23, 2011 at 3:50 pm

    Independent e-Publishers like Open Road are offering 50% as standard royalty rate, advance or no, and some offer advances. I wouldn’t be willing to go below fifty unless there was a serious escalation and/or promotion plan.

  • Major Publishers and the No-Advance Digital Model: Thanks, but No Thanks | The Passive Voice March 22, 2012 at 9:30 am

    […] a print run. That’s just the reality of what’s happening to the book market.Link to the rest at Jackie Barbosa and thanks to tip-machine Jenny for the tip.Click to Tweet/Email/Share This Post […]

  • Hunter Goss March 22, 2012 at 12:09 pm


    I found your post via and decided to read it in its entirety.

    You make some interesting points about what’s happening with traditional publishers moving into the all-digital market. The ‘no advance’ model you describe is not only one of the realities of economics as publishing changes, but it was predictable as well. Traditional publishers facing a shrinking market for paper books want to maximize revenue while at the same time reducing their per-book investment as much as possible. And going digital seems very attractive to them. A thing that was the wave of the future just two years ago is quickly becoming the standard, vastly reducing the risks of abandoning paper. Just taking retailer returns out of the picture is probably enough to entice most publishers to at least dip their toe into the digital pool. The problem in this kind of model is that in these early stages, at least some of the savings are coming at the expense of the author, which you just did a fantastic job of pointing out. The picture you painted isn’t likely to change much, though, over the short term.

    Thanks for a very informative post from a ‘lone ranger’ indie.

  • Hunter Goss March 22, 2012 at 12:10 pm

    For some reason, it didn’t get through on my original post, but I found you through The Passive Voice.

    Need to practice those tags more, I guess.


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