Here are some of the basic parts of a typical publishing contract. Try not to fall asleep.
The territory is a list of countries where a publisher can distribute.
There are three basic types of deals for US publishers:
- US or North America: This gives the publisher exclusive English language control over either just the US or the United States and Canada. (Note that North America does not include Mexico. Sorry, Mexico!! Love you though. Kisses to Belize as well.)
- World English: Just like it sounds. World rights in the English language. This is probably the simplest thing I will explain today.
- World All Languages — Just like World English, only with all of the world’s lovely and colorful languages thrown in. The publisher can sing with the voices of the mountain. And paint with all the colors of the wind.
(Yes. Yes, I did just reference Pocahontas. You saw clearly.)
Let’s go back to the North America type of deal. What’s complicated here is that there is “exclusive” territory and “nonexclusive” territory. Stick with me.
- Exclusive means only the US publisher can distribute in the exclusive territory. That’s home turf.
- Nonexclusive (also known as the “open market”) means both the US and any other publisher (UK or foreign) can also distribute. Think of the open market as unclaimed turf where anyone can roam freely.
So typically in North American contracts the deal is for exclusive North American rights and nonexclusive Open Market rights.
Let’s move on.
Grant of Rights
These are the specific rights that are granted in the agreement. Sometimes this can mean everything under the sun, such as:
- Book publishing rights
- Film rights
- Audio rights
- TV rights
- Electronic rights
- Theme park rights (seriously)
Or it could be one specific thing, such as trade paperback reprint rights only.
If the publisher exercises these rights themselves there is typically a royalty they will pay the author, if the publisher sells these rights to a third party it’s subject to the subrights split.
More on those concepts in a jiffy.
This is the fun part. The advance is the money that a publisher pays the author up front to publish the book. Take it to the bank, it’s yours to keep, even if your book only sells two copies. Huzzah!
A lot of people who are new to publishing find advances kind of confusing. Do you have to give it back if your book doesn’t sell? Nope. BUT. You don’t get paid royatlies until your advance “earns out.”
Think of an advance as a loan you don’t have to pay back. Each copy you sell earns royalties (discussed below) that goes first toward paying off your advance. Then, if your book eventually earns more money than your initial advance you start getting royalties. So if you were paid $10,000, your book has to earn $10,000 in royalties before you start to see extra money.
Advances can range from a hundred dollars to BILLIONS (ok, not billions. Unless you’re Dan Brown. ok, not even Dan Brown.)
Each copy you sell earns a royalty, specified as either a percentage of the cover price or something like a percentage of the amount a publisher receives for the sale. There are lots of different types of royalties depending on what type of copy is sold (hardcover, paperback, mass market, special sales, discount sales, omnibus, anthology… it goes on and on).
As mentioned previously, in addition to printing and selling your book, publishers typically get assorted other rights that they may or may not sell to another publisher somewhere down the line. It’s sort of like subcontracting. If a publisher doesn’t want to do something themselves they can sell the rights to someone else.
So, let’s say a publisher publishes your book in hardcover. They can either bring out a paperback edition OR they can sell paperback rights to another publisher, in which case publisher #2 does all the work to bring out the paperback edition, and you and publisher #1 split the proceeds.
Warranty and indemnity
This sounds like a spy novel, but actually this is the part where you promise the publisher that your book isn’t plagiarized, that you control all the rights, that any recipes are not injurious to the user, etc. etc. Basically you promise on your life that everything in your book is kosher and you accept responsibility for it.
There are often many many many other sections in a publishing contract, but these are the biggies.
Have questions? Let me know in the comments!
But wait, there’s more!
• Need help with your book? I’m available for manuscript edits, query critiques, and coaching!
• For my best advice, check out my guide to writing a novel (now available in audio) and my guide to publishing a book.
• And if you like this post: subscribe to my newsletter!
Art: Signing the marriage contract by George Sheridan Knowles
Note: I am not a publishing attorney so please don’t construe this post as legal advice.