Tuesday, July 18, 2006

Oy, My Aching Head

Oy, my aching head. Why, you ask, is my head aching. Well, I just tried to read ISBNs for Dummies, a guide to the changing format of the ISBN.

For those not familiar, the ISBN is the Social Security Number of the book world. Each edition of each book has an individual ISBN. Take my client Patrick O’Donnell’s book, BEYOND VALOR:

The hardcover ISBN is 0684873842.
The hardcover Large Print ISBN is 0786234334.
The paperback ISBN is 0684873850.
The Abridged Audio CD ISBN is 0553714325.
The Abridged Audio Cassette ISBN is 055352805X.
The Adobe and Microsoft Reader eBook ISBNs aren’t listed on Amazon, but there is one for each, I assure you.
The same can be said for the Audible digital download.

Now, keep in mind that’s for a modestly successful nonfiction work. Think of how many different editions of Harry Potter there must be. And each one has an ISBN that’s ten-digits long. Now think what it will take to make every one of those thirteen-digits long and that every system in publishing will have to deal retroactively with the ten-digit format.

Each country has an “issuing organization” that hands out ISBNs. In our country, it’s actually part of R.R. Bowker, a large data-mining firm that publishes a lot of the directories you find in libraries.

Now, the reason I, as an agent, find this transition a bit terrifying is that publishers calculate royalties based on sales, and sales are reported with ISBNs! Just as everything in your life related to your taxes is tied to your Social Security Number, so is everything related to an author’s sales and royalties tied to ISBNs.

Now, it’s not like publishers haven’t had a while to plan for this. In fact, I found an entire website, including a PDF download, for how to deal with the ISBN transition. It’s located at
http://www.isbn.org/standards/home/isbn/transition.asp. But think about Y2K and what a headache it was for companies to change from a two-digit year format (01-01-99) to a four-digit format (01-01-2006). Imagine what a small publisher that has an old royalty system will have to go through to start accurately reporting using thirteen digits instead of ten. Imagine what a large company with an inflexible system might face.

So, a word to the wise author. Start reading your royalty statements closely. Look at each title you have and figure out what your average sales per period are. And if your first statement with a thirteen-digit ISBN shows sales that are not in line with prior periods, request a reconciliation to print or, better yet, do an AUDIT.

I wonder, in fact, if this transition will result in dozens or hundreds more authors conducting royalty audits.

Did you know that very, very, very few publishers ever get audited by authors? Why is this? In part, it’s because audits are expensive for authors. Yet the VP of one publishing house told me of a larger, well established literary agency that hired a forensic accountant and started conducting audits (perhaps if you are a larger enough firm, you can hire someone on salary and not pay huge, hourly fees). The results were, I’m told, thousands upon thousands of dollars in additional royalties. And, of course, in such a case, the cost of the audit would be for the publisher to pay.

Further, I was told that the major discrepancy found related to the deep discount clause. I’m going to write more about the dreaded deep discount clause in the coming days, so stay tuned....



Read said...

I imagine you already corroborate sales by publisher with sales by store although in my experience stores like Barnes & Noble and especially Borders even with their BINC numbers are not effectively tracking sales.

Andrew Zack said...

I don't think any agent does that. It's simply not logistically or economically feasible. A full audit at the publisher would include reviewing orders, but I am not aware of any agent getting information from B&N or other accounts independently of what publishers provide.

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