Monday, March 16, 2009

360-degree deals for book publishers?

As the record labels watched CD sales plunge, they started to move their focus away from suing fans (though several suits against file-trading sites remain in progress), instead trying to encourage fans to buy music online through legitimate sources. Apple's iTunes is the most visible example.

But the record labels also began looking at the underlying economics of their business: pay advances to sign artists for multiple albums, fund the production of said albums, and hope that enough artists sell enough albums to cover the losses on the many others that never bear fruit. As CD sales dropped, and online sales have made up only a portion of that, the labels considered something else -- although they front much of the money to launch and establish new artists, the labels don't participate in revenue streams such as concert tickets, nor in things like t-shirts and tchotchkes sold at concerts.

What if the labels could instead sign artists to all-encompassing deals? In addition to CD sales, the label and artist would be "partners" in the cashflows from live shows and tours. Thus, the so-called "360 [degree] deal" was born. The labels now boldly tout these deals as reason for optimism about their business.

Could such a scheme work in the book business? Publishers traditionally acquire only the rights to print and distribute an author's work in book form. The publishers never have rights to movie or TV adaptations; they often don't even participate in revenues from sales of the book in other languages or countries.

I noted in an earlier post that publishers have been loathe to negotiate "net" deals, as opposed to the "gross" deals authors ordinarily receive. But perhaps some sort of packaging of rights could make this more palatable. Obviously, established authors like Stephen King would refuse; but it might be a reasonable business-proposition for an unpublished author.

What about 360 deals for publishers and authors?

(As an aside, I'll note that Stephen King is not averse to experimenting with the publishing business model, in that he recently released a Kindle-only exclusive of a new work.)