· Digital Right Attorney (Eric Brown, FWRV)
· Traditional publisher (Rick Joyce, Perseus Books)
· App developer (Charlie Stack, Sideways)
· Author (Seymour Simon, “Science Fun To Go”)
For those who follow me on Twitter, I promised to post what I learned on the joint Authors Guild/Association of Authors’ Representatives panel on Selling Book-to-Multimedia Rights. I envy those who can tweet and absorb information at the same time, but, sadly, I’m not among them. So, herewith is the promised wrap-up, cobbled together as best I could from my scrawled notes.
The panel started out with an introduction from each panelist about what they do and their direct experience with apps and multimedia. It sounds as though Seymour Simon developed his app, “Science Fun to Go,” through Yapper (Your App Maker): http://yapperapp.com/. Charlie Stack’s company, Sideways, designs apps themselves, including the recent and very successful JFK: 50 Days (http://www.americanconsumernews.com/2010/12/jfk-50-days-ipad-edition-now-available-on-the-appstore.html). Rick Joyce of the Perseus Books Group worked with Sideways on the JFK app, which was based on the book JFK Day by Day (http://www.perseusbooksgroup.com/perseus/book_detail.jsp?isbn=0762437421). Eric Brown approached apps and multimedia from a legal perspective.
The discussion went from some of the plusses of apps, like buddy reading where you can read to a child remotely, say through an iPhone, where flipping a page on the phone might flip the corresponding page on an iPad miles away, to the drawbacks of electronic media, including censorship (like Amazon’s removal of Animal Farm from Kindles a few years ago), rundown batteries, being cut off from the cloud or Internet, as happened recently in Egypt, and vulnerability to electromagnetic pulse. It very quickly moved on to defining the differences between enhanced e-books, multimedia, and apps. Eric pointed out that “multimedia” actually has no intrinsic meaning.
Legally, it is whatever it’s defined as in the contract. After a little back and forth, it was decided that the difference between the other two is that enhanced e-books are sold at BarnesandNoble.com and Amazon.com (for example) and apps are bought and sold at an app store. Apps stand alone and are complete in and of themselves. Licensed elements in apps (and I’m guessing in enhanced or multimedia books as well) might have shorter terms of license and thus are not necessarily products for the ages. For example, the term of use an app-maker is able to get on the pictures/video/sound might be different from the “term of copyright” on books. Thus, a multimedia product can only be sold for the length of its shortest license. (Later it also came up that because technology changes so rapidly and updating apps and multimedia to be compatible with new technology is expensive, there might even be other shelf-life issues.) Another legal/practical consideration is that a lot of permissions (for example, for photos in non-fiction books) were granted before electronic or enhanced books were even contemplated, so going back and reobtaining permissions can be a time-intensive process.
Jeff Kleinman of Folio Literary, the panel moderator, threw out a question regarding the non-compete issue. This was to come up throughout the panel. It seemed that the panel agreed that apps were not really competitive with books, as they’re sold in different places and are a different sort of beast. However, a publisher’s take might be different, and there’s no case law so far to consult. Likewise, there’s no standard on how much of a book might be used for an app or multimedia project before it’s considered competition.
There was also no particular standard regarding revenue, which varies depending on the agreements in place and who initiates the project. In other words, did the app developer go to the publisher or the other way around? Apple takes 30% for their sales of the apps, but after that, is it a 50/50 split? Is the publisher treating apps and enhanced books like e-books at 25% of net?
At this point, the discussion rambled a bit. Basically, the question came up as to who pays (answer: it depends) and the many costs associated with enhanced e-books. For example, with enhanced books, you have to queue all the multimedia elements to look right/line up with every font size. There’s the cost of publicity. Rick Joyce from Perseus says that the publisher’s contribution is the commitment to making the enhanced book happen and to publicizing it, while the author contributes the text, of course, and the app developer puts everything together and develops the app or e-book. Contracts have to be specific about who absorbs costs as well, for instance if an app is rejected (there are some censorship issues, and it’s not necessarily true that if you develop the app, they will come). An app can be reworked and resubmitted, but that’s a further expense before any costs can be recouped, and with no guarantee of success.
Eric pointed out that there are odd laws in some countries that say certain levels of encryption qualify things as munitions, so that anything thus encrypted can’t be sold in those markets. App contracts are at least as complicated, it seems, as publishing contracts. It needs to be specifically expressed not just who’s expected to do what, like the editing, but how many pics or minutes of video they’ll be expected to provide, etc. Considerations: who has the right to change prices and what notification has to be given. As mentioned earlier, it’s very expensive to update apps and multimedia to be compatible with changing technology, so contracts are unlikely to include updates. (Certainly, an app developer wouldn’t have upgrading in the contract unless there’s an associated fee.) Also, the iBookstore, unlike the app store, is not an updating platform, which means that when you put out an e-book or enhanced book, it’s got to be right, just the way you want it, because you can’t substitute an update later.
The panelists also talked about price and value. One of the things they do in apps is list the cost of the print version, which gives consumers a way to think about the value of the multimedia version in comparison. They stressed that it’s important for us not to devalue electronic goods.
In terms of marketing, the bottom of the pile with apps and e-books is huge. Unless an app is in the top 100 in some category, the visibility, and thus chances for consumers to come across and buy it, is virtually nil. You really have to be a top seller in order to recoup the large expense involved in creating apps. It’s important to clarify in contracts various parties’; roles in marketing a product. Also, there’s too much work that goes into creating an app unless it’s going to be an event book, something that can be promoted and discovered. (As CNN did for the Kennedy book for which they provided the additional video.) The cost of developing an app, it seemed, was minimally $50,000 to $100,000. The audience for enhanced books/book apps is also pretty limited right now to the iPad, where pictures and multimedia will play. Kindle and other readers aren’t set up for the same kind of interactivity.
The panel then turned to some rights ramifications, like whether enhanced e-books and apps interfered with film and television options/contracts, which seems to be the case from the studios’ perspectives on merchandising rights. There was also the question of what would happen if a publisher let other versions of a book go out of print after they’d created a multimedia version in which they own copyright. Of course, my say is that the publisher would own copyright on the compilation and presentation, but not on the source material, so that with a well-defined reversion clause, generally including a sales threshold, though the panel said that time limits were better for multimedia books/apps, since it’s too early to know yet what will be reasonable from a volume perspective, should take care of reverting the author’s rights, though, of course, he or she couldn’t sell the derivative material created without contracting with the publisher.
Another interesting tidbit. Someone (I want to say Seymour Simon, but I’m not certain of this) described e-books as a one-way conversation with the reader and apps as a two-way conversation. Inside the app itself you can put your Twitter feed, Facebook, appearances, etc.
I hope you’ve all found this to be helpful and interesting. As with all emerging technology, the way of doing business is constantly evolving, so “that depends” came up a lot. Still, I thought there was some good stuff here. Certainly plenty of food for thought.
BIOS (listed alphabetically):
Eric Brown of Franklin, Weinrib, Rudell & Vassallo, has extensive experience structuring and negotiating agreements in all areas of the entertainment industry, including book publishing, motion picture and television production, financing and distribution, live theatrical production, merchandising, executive employment agreements and new/digital media. His practice includes the representation of fiction and non-fiction authors in book publishing and motion picture and television rights agreements; the negotiation of employment agreements for book publishing executives; serving as production counsel for motion picture and television productions, as well as Broadway and Off-Broadway productions; and the representation of internet companies in connection with content licensing and other matters. Eric is Chairman of the Literary Publishing Division of the ABA Forum on the Entertainment and Sports Industries, and a member of the British Academy of Film and Television Arts (BAFTA) East Coast, the Stellar Network, the New York State Bar Association, and a Board Member of the Montclair (NJ) Arts Council. He received his B.A. with Honors from The University of Michigan (High Distinction) in 1987 and his J.D. from Columbia University School of Law in 1990.
Rick Joyce, Perseus Books Group. Rick is the Chief Marketing Officer for the Perseus Books Group, and has been involved since 2004 in the growth strategy for the company through the publishing and distribution services sides of the business. Rick plays a key role in the development of digital products, tools, and services at Perseus. Prior to Perseus, Rick was a partner at Accenture, the global B2B services company. He was in charge of the firm’s Media & Entertainment practice for the Asia Pacific region, out of their Hong Kong offices. In his 7 years at Accenture Rick worked for book publishing, educational publishing, music, magazines, newspapers, TV and internet clients, on a range of projects focusing on growth strategy, marketing strategy, new product development, sales force effectivess, and new media strategy. Rick has a BA from Dartmouth and an MBA from the Columbia Business School.
Seymour Simon, whom the NY Times called “the dean of children’s science writers,” is the author of more than 250 highly acclaimed science books (many of which have been named Outstanding Science Trade Books for Children by the National Science Teachers Association), as well as the Einstein Anderson, Science Detective series of fiction books. He is also a creator and the author of a series of 3D books and a series of Glow-in-the-Dark Books for Scholastic Book Clubs as well as a series of leveled SEEMORE READERS for SeaStar Books. His App is “Science Fun to Go”.
Charles (“Charlie”) Stack, Sideways. Charles Stack is a successful, serial entrepreneur who launched the first online bookstore – Books.com – in 1992. Charles pioneered most of the features we now take for granted in today’s internet retailers. Books.com offered millions of books, comprehensive searching, collaborative recommendations (patented), shopping carts, price comparisons (patented), real-time credit card processing, affiliate programs, and he introduced many other now standard internet retailing concepts. Books.com was acquired by CUC in early 1996 and subsequently by Barnes & Noble in 1998. Charles founded Flashline to address the new opportunity in software components and web services. BEA acquired Flashline in 2006. The Flashline product was the fastest growing piece of BEA’s most important product line, Aqualogic, at the time of BEA’s acquisition by Oracle in May 2008. With Sideways, Charles is on a mission to evolve the publishing industry and take storytelling to the next level.