5th National Editors Conference, Sydney

I spoke on a panel on copyright at the 5th National Editors Conference in Sydney on 8 September 2011. I mentioned that digital and e-books have the potential to give authors an increased share of royalties. Allen & Unwin, for instance, is offering 50% royalties for backlist, out-of-print titles whose rights are held by authors' estates. Royalty rates for e-books are slowly climbing from the initial low figures offered by traditional publishers as it is clear that new competitors such as Amazon, Google and Apple can work with models that offer authors a greater proportion of returns from e-books. It's even more important then that authors retain control of their digital rights.

Amended Google Book Settlement the Way to Go

Revised terms for the Google Book Settlement were announced in New York on 13 November.

The revised terms follow on from October 2008 when a broad class of authors and publishers, the Authors Guild, the Association of American Publishers, and Google announced a settlement agreement that proposed to unlock access to millions of out-of-print books in the U.S. and give authors and publishers new ways to distribute and control access to their works online. If
approved by the Court, the settlement will:
• Generate greater exposure for millions of in-copyright, out-of-print books, by enabling students, scholars, and readers to search, preview, and purchase online access to these works;
• Open new opportunities for authors and publishers to sell their copyrighted works and to maintain ongoing control over the ways those books can be displayed;
• Create an independent, not-for-profit Book Rights Registry that will locate and represent rightsholders, making it easier for everyone, including Google's competitors, to license works;
• Offer a means for U.S. colleges, universities, and other organisations to obtain subscriptions for online access to collections from some of the world’s most renowned libraries;
• Provide free, full-text, online viewing of millions of out-of-print books at designated computers in U.S. public and university libraries; and
• Enable unprecedented access to the written literary record for people who are visually impaired.
On November 13, 2009, the parties to the settlement filed an amended agreement, having carefully reviewed the submissions filed with the Court, including that of the U.S. Department of Justice. The changes made to the settlement were developed to address many of these concerns, while preserving the core benefits of the agreement.
Areas of change are summarized below, and a broader list of changes can be found
in the supplemental notice.

International Scope
As revised, the settlement will only include books that were either registered with the U.S. Copyright Office or published in the U.K., Australia, or Canada. After hearing feedback from foreign rightsholders, the plaintiffs decided to narrow the class to include only these countries, which share a common legal heritage and similar book industry practices. British, Australian, and Canadian rightsholders are joining the case as named plaintiffs and will also be represented on the Board of the Book Rights Registry.
In addition, clarified the wording in the agreement has been clarified to make it clear that works that are for sale as new internationally are considered commercially available and thus Google will not display any of their content by default.
Google remains interested in working directly with international rightsholders and organisations that represent them, including those in countries excluded from the settlement, to reach similar agreements to make their works available worldwide. Authors and publishers from around the world can also enter into promotional and revenue-generating programs through Google's Partner Program.

Unclaimed Works
The amended settlement agreement requires the Book Rights Registry to search for rightsholders who have not yet come forward and to hold revenue on their behalf. The settlement now also specifies that a portion of the revenue generated from unclaimed works may, after five years, be used to locate rightsholders, but will no longer be used for the Registry's general operations or redistributed to other rightsholders. The Registry may ask the court after 10 years to distribute these funds to nonprofits benefiting rightsholders and the reading public, and may provide abandoned funds to the appropriate government authority in compliance with state property laws. The Registry will now also include a Court-approved fiduciary who will represent rightsholders of unclaimed books, act to protect their interests, and licence their works to third parties, to the extent permitted by law.
As with the original agreement, nothing in the amended settlement limits anyone's ability to use unclaimed works.
As Google first announced in September 2009, any book retailer will be able to sell consumers online access to the out-of-print books covered by the settlement, including unclaimed books. Rightsholders will still receive 63% of the revenue, while retailers will keep the majority of the remaining 37%. This provision has been explicitly written into the revised agreement as a Google obligation.

Access Models
The amended settlement does not change the primary access models outlined in the original agreement, including enabling readers to preview and purchase books, selling institutional subscriptions to the whole database, and giving libraries free access at designated terminals. Under the revised agreement, possible additional access models to which Google and the Registry might agree in the future have been reduced and are now limited to: print-on-demand, file download, and consumer subscription.
The amended agreement also enables the Registry to increase the number of terminals at a public library building, and it clarifies that rightsholders can choose to make their books available for free or allow re-use under Creative Commons or other licenses. Rightsholders can also choose to modify or remove restrictions placed on Google's display of their books, such as limits on the number of pages that users can print.

Pricing and the Non-Discrimination Clause
The amended settlement clarifies how Google's algorithm will work to price books competitively. The algorithm used to establish consumer purchase prices will simulate the prices in a competitive market, and prices for books will be established independently of each other. The agreement also stipulates that the Registry cannot share pricing information with anyone but the book’s rightsholder.
In addition, the amended settlement removes the non-discrimination clause (commonly called the "Most Favored Nation" clause) that pertained to the Registry licensing of unclaimed works. The Registry is free to license to other parties without ever extending the same terms to Google.

Legal Matters Seminars Sydney and Ballarat

Sydney, 22 May 2009
Ballarat, 29 May 2009

A typical day at the ASA brings questions about contracts. There are queries about terms, rights, digital contracts, and of course the legal jargon. A different publisher will present a different contact, and you need to clearly understand your obligations and entitlements. Be informed before you sign. Prepare yourself for the legal challenges involved with getting published at this customised workshop. In addition to contracts, other topics covered in this half-day workshop include:

• Who owns copyright? Intellectual property rights
• Copyright protection and moral rights, copyright territories
• Copyright permissions
• Reaching other markets: licensing your rights
• Winning negotiations with your publisher
• Services to the creator – PLR, ELR and CAL
• Avoiding defamation: being clear and careful.

The ASA’s popular Legal Matters workshop has been held in various capital cities and regional venues. Here are some participants’ comments on the benefits of a Legal Matters workshop:

‘You can read things till you're blue in the face, but sometimes they don't strike home till you're part of a discussion about them. The interactive nature of it and the differing concerns of other authors was a big plus for me.’

‘More confidence to read and negotiate terms of contracts.’

‘Lots of good solid information!’

‘Adds to understanding of a very complex area.’

‘Interaction with a variety of writers … made it additionally interesting as different points came up.’

Sydney
Date: 22 May 2009, 2-5 pm
Venue: Australia Council, Rover Thomas Auditorium, 372 Elizabeth Street (cnr Cooper Street)
Cost: $55 ASA members, $187 non-members. Non-members pay the member's rate plus $132 – the cost of Affiliate membership. We encourage non-members to join and receive all the benefits of ASA membership.
Download your registration form here.

Ballarat
Date: Friday 29 May 2009, 2.00 pm – 5.00 pm. Afternoon tea provided.
Venue: BEST Community Development Conference Centre, 28 Victoria Street, Ballarat, VIC.
(03) 5329 1500
Download your registration form here.

For further information phone 02 9318 0877 or email Kris Clarke.

Parallel importation: Cheap books, but at what price?

My book Perfect Timing is about to be published in a Vietnamese translation. It will sell for 20,000 Dong, about A$1.45. I’ll receive 5% of that price on each copy, a princely seven cents, so I’m not about to retire.
But what this makes clear is that books are much cheaper in Vietnam than Australia. I could buy 15 copies of my Vietnamese edition for the price of an average Australian paperback. So, why is the book cheaper? The paper and print quality will be lower than the Australian edition for one. Another is there’ll be several more thousand copies printed in Vietnam than were ever printed in Australia, but the book will still be a tiny blip in a market of over 80 million readers. And those readers are much poorer than readers in Australia. To them, spending 20,000 Dong on a book is a luxury purchase.
So the price of books is relative from one country to another. The return to me from sales in Vietnam will be small financially, but large in the sense that I will have many more readers. I’m assisting with a tiny bit of cultural exchange as well. These are immeasureable benefits with no financial value.
But they’d still be there if I was lucky enough to sell US rights to my book, although the financial implications would be very different. I’d actually make some money – again, not enough to retire on, but enough perhaps for a new computer or new car.
As an author, I can trade my rights in different markets for different reasons. Trading of rights is the commercial basis for life as an author. We can sell Australian publishing rights, rights for translation into Vietnamese or rights to an American edition. This is intrinsic to our continued livelihood. Quite a few authors have different publishers in different markets. Australia, in line with most major book markets in the world, including the United States and United Kingdom, is currently a “closed “ market. Books can only be published here by the entity who holds the rights to the Australian territory. These rights are saleable parts of the bundle of rights that make up an author’s copyright. For example, popular author Jodi Picoult is published by Allen & Unwin in Australia, but by Hachette in the UK and Atria in the USA.
However, there are moves afoot to take some of these rights away from us. The moves are being led by booksellers, particularly, Don Grover of Dymocks (Sydney Morning Herald, September 4, 2008). Booksellers are usually an author's best friends, but not Don at the moment.
Why? Don wants an open market. He wants to take away the right of Australian authors to transact their rights in different markets. His argument is driven by the profit motive of course. Don claims the wholesale price of books is cheaper in the United States through competition. And there is undoubtedly more competition in the US in the book industry than there is in Australia. The US book market is more than 10 times the size of Australia. Don also says books are expensive in Australia because the Australian publishing industry is artificially protected from competition. This is his subtle reference to our Copyright Act and the protection it gives to rightsholders – like authors.
But the US is by no means an open market. Nor should it be. Both the United States and Australia are separate copyright territories, and books are licensed into each territory by their rightsholders. Few Australian books receive much attention in the US. The Australian market is far more competitive than the US market because Australian books have to compete with those from the US and the UK. Under our law as it currently stands, all books published outside Australia must be made available in Australia within 30 days of their publication, or the rightsholder loses their exclusive licence to publish the book in Australia.
Grover’s suggestion is for those rightsholders to lose their right. The Council of Australian Governments (COAG) announced at the end of July that it had asked the Productivity Commission to review Australia’s copyright laws so far as they related to the parallel importation of books. Grover is pushing hard to destroy Australia as a distinct publishing territory. In his argument, he ignores the fact that the US and UK are closed markets. He also ignores the fact that book prices in open market territories such as New Zealand and Singapore are equal to or greater than those in so-called closed markets.
His fallacious argument is designed merely to increase Dymock’s profit margins, not to make books cheaper. Dymocks could make book prices cheaper in their stores overnight, if that was their real interest. How? Dymocks receives a minimum 40% discount on the Recommended Retail Price (RRP) on books it buys from publishers so they have nearly half the price of the book to play with in -- and often more when they negotiate bigger discounts. We don’t know how much of the 40% of the price of a book is Dymocks profit, but the company appears to be doing well. And it’s not as if Dymocks is a risky business, like drilling for oil. Their purchases from publishers are on a sale or return basis. What they haven’t moved off the floor after six weeks gets sent back to the publisher for credit.
In contrast, life is bit tougher for the publisher, and much more so for the poor author. When a book is sold by Dymocks, the publisher gets about 12% (at least ABS statistics from 2004, the most recently available, show that) and the author generally receives 10%.
What’s clear from this is Dymocks is in the best position to immediately reduce the price of books by passing on part of its discount to consumers. No need to change our copyright laws. No need to destroy the livelihood of Australian authors and their ability to transact their rights both here and internationally for whatever those markets will pay.

Parallel importation of books and the income of authors

In a surprise move for Australia's literary creators, the Communique from the Council of Australian Governments’ (COAG) Meeting of 3 July 2008 includes a reference to a COAG agreement on a number of priority areas for competition reform, including parallel importation of books. According to the Communique, the Commonwealth will request the Productivity Commission to undertake reviews of Australia’s anti-dumping system and parallel import restrictions on books.

What, you may well ask, is parallel importation and why is it important for Australian authors? “Parallel importation” refers to importation of products containing copyright material that are manufactured legitimately in the country of origin. In the case of books, parallel importation requires permission from the Australian copyright owner, unless the book was not published in Australia within 30 days of its publication overseas, or the Australian copyright owner cannot supply the book within 90 days.

To ensure Australian bookbuyers had access to the most recent of overseas-published books, the Australian rights up to then to which were often held by a British or US publisher who delayed or withheld distribution of the book in Australia, the Copyright Act was amended in 1991 to allow parallel importation in the circumstances outlined above, following a report of the Prices Surveillance Authority. The Act was subsequently amended to allow parallel importation in more extensive circumstances for CDs, computer software and computer games. There is substantial evidence that this has led to a massive decline in the sales of Australian recorded music, though this is difficult to measure when recording companies first responded to the advent of digital technology with a "head in the sand" approach and lost many sales to unauthorised downloads.

The Australian book publishing industry these days is worth over $1.5 billion. It is Australia's most successful creative industry. Australian books make up nearly 70% of those sold in Australia. The industry has also been very successful in exporting the works of our literary creators, so much so that Shaun Tan and Garth Nix and Nick Earls and Margaret Wild and Tom Keneally and Geraldine Brooks and James Bradley etc. etc. are best-sellers overseas. But they are best sellers in editions licensed to those overseas marketplaces. These licensed editions bring our literary creators welcome additional income. However, if parallel importation restrictions are removed, our literary creators will lose the home market to other editions for which they will receive minimal or no royalties.

The proponents of an open market argue that books would become cheaper for consumers and that 90 days is still too long to wait for a book from the Australian copyright owner. Both of these points are arguable. What the proponents do not point out, though, is that both of the biggest English language book markets, the Uk and the USA, are essentially closed markets in that the sales of books licensed to other territories is prohibited in much the same way as it is in Australia. But both these markets are also many, many times larger than the Australian market. Overwhelming, the books sold in both of those markets are produced especially for each market. It would be rare for a UK edition to sell in the USA and vice versa. But we are being asked to accept an open market for Australia when our market is so much smaller and already much more competitive. This would disappear if all editions were allowed into Australia. It would destroy our publishing industry, which has taken over a hundred years to evolve to the point where the major part of the content sold is Australian and the industry is profitable.

What is more, we would lose our literary culture. And the only people to benefit would be those who are supporting the Productivity Commission review -- and that seems to be primarily the chain bookseller Dymocks. You could be forgiven for thinking that Dymocks are prepared to sacrifice Australia's fragile liteary culture to increase their own profit levels by selling cheap imported editions of overseas books and what would be tantamount to pirated editions of Australian books. But surely that could not be the case when the Hon Bob Carr, former NSW Premier and in that position noted proponent of Australian literature, is on the Dymocks board?

Garth Nix has written a very comprehensive letter about the matter in Australian Bookseller and Publisher. Nick Earls has written to the Prime Minister on the issue. Both of these letters are worth reading, and you can here. They are very balanced approaches to a complex issue, though a simple one for Australia's liteary creators -- their very survival.

This isn't a matter that's simply about the cheapest price. It's about the maintenance of a distinctively Australian culture, about reading our own stories, hearing our own voices. Can you put a price on that?

Authors need to show their opposition to any proposed changes to the current restrictions on parallel importation of books. Take up your pens and write directly to the Prime Minister and the Federal Attorney-General, as well as your State Premier and State Attorney-General. Writing to all of these is necessary as the matter has been raised at COAG and thus becomes a cross-jurisdictional issue.

There will be more on this issue.

Will income ever come to authors from digital sales?

In November, 2007, the US Book Industry Study Group (BISG) met and discussed income from the digital supply chain. Digital issues remain at the core of what BISG is currently focusing on as a new type of supply chain, “a digital supply chain”, is emerging. However, if the sale of digital information is to be successful new standards need to be set and ways to identify digital products need to be developed. The common supply chain model for the digital environment involves the ability to sell pieces of books digitally. This results in an explosion of content fragments that need to be identified so that their sales can be tracked..
Managing fragment sales will be far more complicated than monitoring sales of print books, which have at most two or three editions (hardcover, trade paperback and mass market paperback). The challenge is managing hundreds of thousands of pieces of content. What is needed is a system that can manage not only print editions of a work, but an expanding range of digital products that includes audio, e-book, customized texts and various fragment sales such as the sale of book chapters. One proposed solution is the International Standard Text Code (ISTC), which is expected to be introduced next year and will bring together all the different formats of a piece of content under one identification number.

Authors in Priority Schools Program report

The Australian Society of Authors (ASA) Authors in Priority Schools pilot project involved the Commonwealth Department of Education, Employment and Workplace Relations (DEEWR), the Australian Society of Authors (ASA), the Priority Schools Programs of the NSW Department of Education and Training (PSP) and the English Unit, Curriculum Directorate of the NSW Department of Education and Training (DET). A report on the project is available on the ASA website (http://www.asauthors.org/scripts/cgiip.exe/WService=ASP0016/ccms.r?PageId=10067).

The report demonstrates that:
• The Authors in Priority Schools project was highly regarded by students, teachers, parents and the authors
• Students’ positive attitudes to reading improved
• Students’ positive attitudes to writing improved
• Teachers gained useful knowledge from the project
• Teachers found the workshops useful in developing materials and strategies for engaging students
• Teachers valued the insights gained from observing an author workshop narrative
• All teachers agreed that the students’ attitudes and engagement had improved.
• Anecdotal comments indicated that participants agreed that the outcomes for the project were achieved. Comments to support these findings included: “Overall, the project has been a great success with tangible improvement in interest, engagement and writing skills of students … Students were extremely proud of their achievements ...(The) staff felt that they were given good ideas”.

Remuneration in Australian Publishing

It comes as no surprise that publishers are the main beneficiaries from the publishing industry in terms of receiving the greatest financial benefits. However, up until 2002-03, the returns from publishing were not significantly different from returns from cash investment. Between 2001-02 and 2002-03, the operating profit before tax for book publishing businesses increased from $50.2 million to $88.4 million. The profit margin increased from 3.3% in 2001-02 to 5.6% in 2002-03.
In 2003-04, however, this situation changed dramatically. Overall operating profit for that period was $152.1 million or 9.7%. The profit margin for the 20 largest book publishers was 4.4% in 2002-03 but rose to 9.7% in 2003-04. Other book publishers had a profit margin of 10.2% in 2002-03 and 12.7% in 2003-04, which is a very healthy return by any standard.

Salary scales for publishers
At the end of June 2004, there were 5,300 people employed in book publishing. In 2003-04, 3,547 (67%) of these 5,300 employees were employed by the 20 largest publishers. In 2003-04, wages and salaries paid by publishers came to $266.1 million, which represented 19% of publishers total expenses compared to the 6.5% paid as royalties or fees (down from 10.9% the previous years). In 2003-04, royalty payments and fees paid by publishers fell 11% or $11.7 million from $102.6 million to $90.9 million.
In 2002-03, the average salary of full-time publishing employees was $46,554. In 2003-04, this had risen $52,300, an increase of 9% over the previous year. However, only 3972 of these employees were full-time. Therefore, many people working in the publishing industry earn much more. Senior sales and publishing managers may well receive $150,000 to $200,000, or even more with bonus payments and fringe benefits. Sales representatives will have salaries from $50,000. Administrative staff members have salaries starting from $40,000.

Salary scales for editors
Publishers use the term “editor’ with some looseness. “Acquisitions” or “Commissioning” editors may be publishers, and receive payment as such. The term editor here refers to those people who work on a manuscript and shepherd it through the production process. and are covered under the Book Industry Award. Under this award, trainee editors commence on a salary (at the time this was prepared) of $30,600 and the highest grade receives nearly $51,000 plus 9% superannuation. In practice, many publishers pay above these rates and offer fringe benefits.
The freelance rate for book editors currently appears to vary between $45 and $75 per hour. How many freelancers can be assured of this rate however depends on their desperation and the publisher’s powers of persuasion.

Payment scales for indexers
The Australian and New Zealand Society of Indexers (ANZSI) recommends a base rate of $55.00 (excluding GST) an hour for its members. The same comment as above applies regarding how many indexers can be assured of this rate.

Remuneration to authors
Authors survive on royalties, payments for subsidiary rights, lending rights payments and payments for statutory reprographic rights (administered by Copyright Agency Limited [CAL]). Even so, the Throsby and Hollister report Don’t give up your day job indicates that in the period 2000-01 writers had a mean arts income of $26,400 and a median arts income of $11,700.
In 2001-02, the proportion of sales of Australian titles of $853.8 million paid as royalties and fees to creators was 10.9%, or $93.06 million. In 2002-03, the proportion of sales of Australian titles of $877 million paid as royalties and fees to creators was 11.7%, or $102.6 million. This amount dropped in 2003-04 to $90.9 million, only 6.5%.

Authors income throughout the world

What is an author worth? What he or she is paid, ultimately. And unfortunately that is often out of all proportion to the work an author must do to create a work.
In Australia, the best data on what an author is worth come from the work of David Throsby and Virginia Hollister for the Australia Council. The 2003 edition of their book Don’t give up your day job states that in 2000-01 the median earned creative income of writers was $4,800, the total arts income was $11,700 and the total income was $35,000. Throsby and Hollister acknowledge that income for writers can come from various sources. The Australian Society of Aithors (ASA) has long championed a range of income possibilities for writers. Payments from royalties from the sale of the published book are the main income stream from a publishing contract, but the exploitation of subsidiary rights such as serialisation, film and other adaptation rights can be quite valuable both on publication and afterwards. As the age of book increases, its potential to earn royalties usually decreases, which is why the ASA has been the driving force for the creation of payments for lending rights and from copying, both of which extend earnings to the author from the exploitation of their work.
Throsby and Hollister took all these income streams into account when assessing authors’ incomes, as well as other types of income coming from public appearances, reading and activities related to authorial activity. This means that the Australian figures on authors’ incomes are relatively comprehensive. For example, Throsby and Hollister found that 42% of writers earned less than $10,000 from their creative and arts-related work, while 18% earned $50,000 or more. When income from all work was considered, this figure dropped to 13% of writers earning less then $10,000 and rose to 35% of writers earning $50,000 or more.
The same isn’t always true of data from the rest of the world so when we compare authors’ income internationally we have to be conscious that what is being measured isn’t always the same thing. Nevertheless, international comparisons are a useful means of assessing the success of Australian authors as income-earning writers.
Let’s consider our South Pacific neighbours first. Using the services of Research International, the New Zealand Society of Authors (NZSA) recently surveyed 355 mid-career and established writers regarding income (New Zealand Author, Oct/Nov 2007) and discovered that “ just 17 per cent of New Zealand writers survive solely on their writing income”.
The New Zealand figures also showed that the mean total of a writer’s income from all sources (but excluding full-time work) was NZ$15,383 (A$12,768). The minimum wage in New Zealand is NZ$23,400 (A$19,422).
The NZSA found that
• 77 per cent of mid-career authors earn less than NZ$10,000 from writing;
• only 9 per cent of established authors earn over NZ$50,000
• only 30 per cent of mid-career and established authors have received a grant in the last four years; and
• 34 per cent of authors say they couldn’t afford to write without the help of family of friend.
As to other income streams, New Zealand authors have not yet achieved some of the successful additional income sources available to Australian authors through the ongoing work of the ASA. As an example, set up in 1973, the New Zealand Authors' Fund acts a bit like Public Lending Right as it compensates New Zealand authors for the loss of income through holdings of their books in New Zealand libraries. Authors may register with the Fund if they are eligible to receive royalties for their books and if more than 50 copies are held in New Zealand libraries. The Fund was meant to allow authors to pursue their writing full-time. The survey showed only 9 per cent of writing related income came from the fund. An overwhelming majority – 78 per cent – of the authors surveyed stated that if the Fund offered more they would be better able to make writing their career, even though over 1400 authors benefit from the Fund.
Tings are a bit more positive in Europe. There, the Authors’ Licensing and Collecting Society (ALCS), based in the UK, commissioned a comparative study of authors’ earnings from Bournemouth University. They sent out 25,000 questionnaires to ALCS members and two professional bodies in Germany (Verband Deutscher Schriftsletter [Association of German Writers], and Verband der Drehbuchautoren [Association of Scriptwriters]). The survey defined three categories: professional authors, who allocate more than 50% of their time to writing; main-income authors, who earn more than 50% of their income from writing; and audio-visual authors, who work mainly in television, film, radio and the internet. Another category of academics/teachers covered other writers in the educational sector. In the United Kingdom because ALCS is a collecting society which administers some educational licences, the academic/teacher category was larger as a proportion of authors. The German sample, drawn from members of professional writers organisations, saw a much smaller proportion of academics/teachers.

Table 1: Mean and median income for author groups (pounds sterling: one pound equals $A2.26)
Main-income authors Professional Audiovisual Academics/teachers Total
Australia* NA NA NA NA 100%
Mean NA NA NA NA $46,100
Median NA NA NA NA $35,000
UK†* 33% 46% 8% 32% 100%
Mean $A93,080 $A64,048 $A86,131 $A12,434 $A37,360
Median $A51,980 $A28,117 $A33,900 $A3625 $9,040
Germany† 63% 90% 19% 4% 100%
Mean $A42,951 $A31,364 $68,686 $A4,857 $A30,200
Median $A31,188 $A18,713 $A46,782 $A4,678 $A18,713
New Zealand NA NA NA NA 100%
Mean $A12,768
Median NA
*Data from Throsby/Hollister, 2003. Period is 2000-1. Figures are total income.
†Authors could be in more than one category.

For the United Kingdom, writing was shown to be a very risky profession with median earning less than one-quarter of the typical wage of a UK employee. And there is is significant inequality within the profession. The top 10% of UK authors earn more than 50% of the total income. Moreover, when the ALCS 2004-05 figures were benchmarked against the figures collected by the UK Society of Authors in 2000 they appeared to indicate that the earning of a typical UK author were deteriorating in real terms. The median (‘typical’) earning in 2000 were A$14,313. In 2004-05, the same earnings were A$9040.
As we don’t have similar Australian figures, we can only posit that the situation is similar in Australia. From anecdotal reports, it does seem to be so.

Professional authorship: The key to living from writing

I am often asked to deliver a guest lecture or a seminar to university and TAFE creative writing classes, or a workshop at a writers’ festival. I am always happy to oblige. What I usually talk about is often considered boring – copyright, contracts and conditions. However, my audience doesn’t seem to think what I have to say is boring, since it relates closely to their ability to make a living from their writing.
They ask me detailed questions about the clauses of contracts, rights, subsidiary rights, what they need to do to obtain permission to use third-party works, how they can avoid defamation, the term of copyright in Australia, whether work published on a website is copyright, what is a standard royalty and a myriad other things with which they have never before had any connection in their course, but which they want to know. I hope I do my part.
The reason I am asked to speak, of course, is because I probably know more about these issues than most teachers of creative writing. I’m not a lawyer, but I can assist with the legal practicalities that are very much part of the professional practice of writing.
But it seems a shame to me that this sort of basic professional knowledge does not form a part of creative writing studies. Journalism courses, in contrast, have mandatory legal strands. They may also cover basic accounting practices for journalists who are freelance. Surely, since most creative writers are entering into what is essentially a freelance career, similar knowledge needs to be given to creative writing students to best equip them for the small business world of the professional writer?
I say this as a constructive suggestion for the evolution of creative writing as an academic discipline. As a graduate of writing classes myself, and some very good ones too, but with a background in publishing and an understanding of copyright, I feel strongly that writing students are missing out on a vital part of the skill set they needed to prosper as writers when they are not offered some legal and financial knowledge to help guide them as writers. The ASA is always happy to assist in the regard.
Another area that does not seem to receive much attention in creative writing at present is a sense of the market for writing. It is unfortunately true that the market for Australian “literary’ (I abhor that word) fiction is particularly dire at present. That doesn’t mean Australian fiction isn’t selling. As I write this, there are four Australian works of fiction in the top ten bestsellers: Matthew Reilly’s The Six Secret Stones is at number one, while ASA members Di Morrissey (Monsoon), Monica Mcinerney (Those Faraday Girls), and Judy Nunn (Floodtide) are at fourth, sixth and seventh place respectively and it is terrific to see them enjoying such success.
But students in creative writing classes ought to be aware that their chances of having non-mass market novels published right now is slim. Does this mean that they should not write them? No, but they would be better prepared for life as a professional writer if they had some knowledge of the dynamics of the publishing industry and the market for books in Australia. I try and provide some perspective on this for those who come to listen to me. I show the dismal statistics and break down sales into genres and categories. My information may not be what my audience was expecting to hear, but at least it provides them a degree of reality regarding their chances of succeeding as a professional writer in their chosen area.
One of the other things I suggest to beginning writers is that they should have more than one arrow for their writing bow. The skills of the craft of writing can be used in more ways than one. One of the suggestions I have put forward to the Literature Board of the Australia Council is for a program of residencies for writers within industry. I’d like to see creative writers learning the skills and craft of writing annual reports, press releases, and internal communications. At the same time, they could be sharing their creative writing skills with other employees. If they were employed on a half-time basis, say, they’d have some income to underwrite their own creative writing as well as the ability to learn other writing skills that can assist them through other lean times. I tend to think we have become too specialist as creative writers, particularly with regard to fiction. My November 2005 plenary address to the Australian Association of Writing Programs expands on these issues and can be read here.
This is not so true of creative non-fiction (which also has the largest market share of the book market at present), but often the writers who succeed at this have a journalistic background. Granted, Anna Funder’s Stasiland had its origins in creative writing classes and an ASA mentorship, but books like Chris Masters’ Jonestown benefit from well-honed journalistic skills. Over the years journalists have offered much to the Australian book industry and perhaps this has much to do with their ability to be flexible in their point of view. The leftish journalist Brian Penton wrote a couple of great Queensland novels (Inheritors and Landtakers) in the 1930s before becoming editor of Frank Packer’s Daily Telegraph in 1941 and excelling himself in emulating the outrageous industrial relations of his boss.
But let me leave the last words to the creative writers. Some years ago I was studying under the late, great Glenda Adams at the University of Technology Sydney. Glenda was a wonderful teacher who gently pushed her students towards narrative excellence. It was not her fault that I was too heavy to be pushed far in that direction.
Nevertheless a remark Glenda made in one seminar has stayed with me. Glenda remarked that we wrote, basically, because we were compelled to by our obsessions. She didn’t mean that writers were obsessive. Rather, she meant we were compelled to write because we had something to say. The point she was making was that this was not necessarily enough for our writing to meet a readership. We had to impose the discipline of the craft of writing on our obsessions so that we could most effectively communicate with our readership.
Even more years ago, at Macquarie University, Thea Astley worked hard to imbue me with an appreciation of Australian literature. In her measured fashion, she succeeded very well. Thea taught me to dissect books from the author’s viewpoint. We never discussed obsessions, but in our analysis of Voss, Maurice Guest, The Pea Pickers, To the Islands and Astley’s own The Acolyte this was the not-quite-invisible elephant in the room.
But Thea too concentrated on the art and craft of writing. The obsession was simply the kernel of the author’s desire keep refining their art and craft over thousands of pages and multiple drafts. This hard-working concept of the creative process is the one to which I subscribe. It may be that some people are born great writers, but many need a good deal of training. And all, I posit, need to understand the market they are entering as writers. The fact that a good manuscript receives continual rejections may not mean it is unworthy of publishing – it may simply mean that publishers can see no market for it. This is an unfortunate economic fact of life and we do all aspiring authors an injustice if we do not make this clear to them.

Parts of this article first appeared in the December 2007 issue of Australian Author. Copyright © 2008 Jeremy Fisher/Australian Society of Authors.

A breath of fresh artistic air

Australian authors should welcome the advent of the Rudd Labor Government for a couple of reasons.
First, Labor produced an arts policy before the election. The Coalition failed to do so. While the ALP arts policy had a number of holes, particularly to do with literature, at least it was a policy. In policy terms, I happen to think the Greens arts policy is actually much better articulated, but the Greens do not have the majority in the House of Representatives. Nevertheless, Labor relies on Green preferences for its majority in many seats and the new government should not lightly discount the Greens' arts policy.
Second, Labor suports ongoing funding for Educational Lending Right (ELR -- as did the Coalition, the Democrats and the Greens). But authors still need to ensure that ELR funding is increased and indexed.
Another reason for which we should welcome the election of the Labor government is the appointment of Peter Garrett AM to the position of Arts minister. Peter is a practising artist. He know the difficulties and issues artists face. I believe he will be a great arts minister. I congratulate him on his apointment.

Google print and remuneration for authors

We all know Google as the search engine we’re most likely to use on our computers, as I do several times a day. Google is also a public company, making its stock market debut in August 2004 when 19.6 million shares were sold at US$85 (A$113.77) raising US$1.67 billion (A$2.24 billion). Today, Google is worth roughly US$90 billion (A$120.5 billion), making staggering profits through its online advertising programs. For the third quarter of 2005, Google reported record profits of US$ 381 million (A$510 million) on revenues of US$1.6 billion (A$2.1 billion) and sales of US$1.05 billion (A$1.4 billion). Google is no charity.
Recently, the company announced the Google Print project. On the face of it, Google Print is an excellent use of internet technology. If you haven’t used it, check it out at http://print.google.com.au. You’ll find you can search an online database of thousands of books and view sample pages. For example, I used the search term “Australian Society of Authors” and in seconds I had a list of publications in which this term appears. The publications included a tremendous variety of works a considerable number of which were by past and present ASA members including works of Anthony Barker and Anna Funder. The only thing these works had in common was that somewhere in their text was contained the term “Australian Society of Authors”.
With the next mouse click Google Print took me directly to an electronic copy of the page where that term appears. In the case of Anthony Barker, the page was from the index where the ASA was listed. For Anna Funder, I found myself looking at the acknowledgements section of Bruno Amato’s Italian translation of Stasiland, the novel published after Funder’s ASA mentorship with John Tranter. I could look at a number of pages either side of the one I was first taken to, as well as the copyright page and the contents pages. I was unable to print out any of the book pages. Google claims this is impossible, as it also claims it is impossible to access an entire book through this means. However, I suspect some smart hacker is already working on ways to outwit the protection technology Google has in place.
The books I uncovered in my search had been licensed into Google Print by their publishers. Google Print is aimed at publishers, although it will deal with self-publishers. It invites large publishers or small presses to think of Google Print as a free worldwide sales and marketing system that matches people who are looking for information with the relevant words and phrases inside their books.
A number of publishers, such as Cambridge University Press, still have reservations about the system and they require users of Google Print to enter additional information before they can view the pages of their books. For these publishers, users are required to register to use the service. Some other publishers list only their books and restrict access to any pages from their books, even though the content remains searchable. That is, a user knows the information is in the book but can’t read it on screen. Other publishers allow users to search non-fiction works, but not fiction. As an example of this, I searched using Miles Franklin award-winner Andrew McGahan’s name. An impressive list of his titles appeared and I was able to view front and back covers, access ISBNs and read copyright information but nothing else. It was enough to give me a taste of the books. Amazon offers a similar service for many of the titles it offers for sale and displays front and back cover, contents copyright information and a little snippet of text.
Google argues its business model will attract new readers and boost book sales, allow publishers and authors to earn new revenue from Google contextual ads, and to interact more closely with customers through direct links back to the publishers’ websites. It is certainly a service of benefit to serious and casual researchers, and it’s much less confronting than asking a stupid question of a librarian or bookseller. Indeed, booksellers should be worried about this model as it has the potential to remove them from the supply chain.
Potentially authors can gain not only extra sales but additional subsidiary income, provided of course their publishing contract allows for them to share extra revenue from Google Print or in fact permits the publisher to licence an electronic facsimile of their book into Google Print. Questions about such grants of rights may well become issues between authors and publishers in the future, as is currently the case with aggregators of online content. Even so, Google Print seems like a sensible move into the digital environment. Google’s competitors think so. Yahoo, in partnership with Hewlett Packard, Adobe and the universities of California and Toronto, has announced plans to offer searchable, digitised texts as well. Yahoo, like Google, obviously scents money. Unlike, Google, however, Yahoo plans only to digitise works that are in the public domain or for which it has the rightsholders’ permission.
It is Google’s plans to digitise works without the permission of rightsholders that has earned the wrath of both the Authors’ Guild and the Association of American Publishers. Both organisations are suing Google. The issue is Google Print’s abuse of authors’ rights through its digitisation of books held in various US libraries in a project known as Google Library. In doing so, Google shows no respect for copyright. Rather, Google is claiming it has a fair use exemption that permits it to ignore the rights of authors and publishers.
Google’s seeming concession to rightsholders is to offer an “opt out” facility. Google says it will not digitise the works of those who voice their objections. Google also says it will remove works already digitised if rightsholders – and that means authors like you and me – tell it to do so.
Sounds reasonable, says Joe Public. Sounds like daylight robbery to me. Google has no right to steal the digitisation rights of authors. It is acting like a thief in this regard. It is no defence for a thief caught with stolen goods in his hands to say “oh, is this yours? Sorry, I didn’t mean to pinch it. Here, have it back”. It’s no defence for Google, either, but nevertheless Google is trying it on.
Respect for copyright, and the creative effort it is intended to reward, is a vital concern for both authors and publishers. It is the basis for the contracts into which authors and publishers enter.
Google’s digitisation of books in libraries ignores this. Google proposes to digitise hundreds of thousands books in their entirety without seeking permission from the authors of those books. Theft is theft is theft. And yet it doesn’t have to be this way. Google could licence the content and not act as a pirate, raiding library collections without regard for rights. With an appropriate licence system in place even more material could be made available to users. This is not a difficult problem to overcome. Businesses sign licence agreements every day.
Obviously, Google sees profitable outcomes in its investment in Google Library. Both Google Print and Google Library are intended to bring more visitors and profits to its website and ancillary services. However, in the case of Google Library, the profit comes from the works of authors. Those authors – you and me -- should be properly compensated.
Nothing more, nothing less.

Australian publishing and decreasing opportunities for authors

There are some worrying trends in the sales of books in Australia. Sales of books declined by 19% after the introduction of the goods and sales tax (GST) in 2000, but GST cannot be regarded as the only as sales also fluctuated downwards by 20 million or 15% in 1997-98. They surged back in 2001-02, but operating profit for publishers continued to decline, particularly for the top 20, and sales again declined in 2002-03. The value of sales, however, has increased year by year, except in 2000-01 when GST was introduced, until 2003-04. The proportion of Australian books making up these sales has also increased to 64% in 2002-03, a proportion much the same for consumer books as education books (the figure is about 1% lower for educational books), but the figure dropped in 2003-04 to 60%. Sales of educational books also declined and sales of Australian fiction plummeted.
There are some in the publishing industry who look at these figures with alarm and argue that publishing is in decline, under threat from electronic competition from DVDs and computer games. But it should be remembered that the number of books published in Australia plummeted 20% in 1981, with consequent loss of sales, and the market recovered, even under the threat of videos. Books have shown remarkable resilience, even as the level of readership appears to be decreasing. What is remarkable is that readership levels maintain a relatively high standing despite the increased demands on leisure time provided by electronic alternatives.
Even so, there is plenty to be concerned about regarding the publishing of books relevant to Australia’s literary culture. The sale of Australian-originated books declined by $50 million in 2003-04 after healthy increases in previous years. The industry has only been subject to this degree of analysis since 2000, but the ABS does not propose to continue to survey the industry in such detail any longer, so this snapshot, inconclusive as it is, may be the only information retrievable on the state of Australian-originated publishing. The Australian Publishers’ Association, whose membership is dominated by large, overseas-owned corporations, interprets this information differently in the September 2005 APA Update. The APA records “the news is pretty good” and so it is for overseas-owned publishers. Profitability increased in 2003-04, a result of lower costs, even though sales dropped $18 million on those in 2002-03 and the hardest hit part of the market was Australian-produced books.
The publishing of Australian originated fiction publishing appears to have reached a peak of $125.2 million in 2001-02 when the category outsold imported fiction ($102.5 million) and is declining. Only $73.1 million in sales of Australian fiction were achieved in 2003-04 compared to $116.6 million for imported fiction. Generally, figures show mass market paperbacks have the highest sales value compared to trade paperbacks and hardbacks. Because the unit price of mass market paperbacks is much lower, however, the return to an author per copy is much less, assuming that all authors receive a royalty of 10% of recommended retail price (and publishers like Penguin are trying to drive the royalty rate even lower).
The decline in sales of Australian-originated books is reflected in the fact that royalties and fees paid by publishers in 2003-04 declined 11% on the previous year.
Sales of the nonfiction category, which covers cookbooks, self-help, and a diverse range of other subjects, is increasing. This is supported by data from Nielsen Bookscan which shows that nonfiction titles make up 53% of the market for books while fiction makes up 28% and children’s book make up 18%. ABS data show non-fiction books, both Australian and imported, were worth 59% of general content sales in 2003-04.
Sales of Australian originated childrens’ books increased in 2003-04, but this market segment is still dominated by imported books.
Of concern to all authors is the fact that the average selling price of Australian titles dropped from $11.36 to $9.10 (a 20% decrease) between 2002-03 and 2003-04. For royalties calculated on the selling price, this represents a drop in income for authors. In contrast, the average salary of a publishing company employee rose 9% to $52,300. Editors also had an award increase.
The market share of imported books is also a threat to Australian authors. The increase in non-fiction is not compensating for the drop in sales of fiction.
While the number of new titles in 2003-04 is marginally greater than the previous year, these titles appear on the face of the sales information to have lost market share.
More information is available in my publication Current Publishing Practice.

Literature in Australian Education

The ASA's activism in favour of the teaching of Australian literature is paying off. Western Australia has announced it is introducing a new course (Compelling Course in Aussie Literature) and the NSW Minister for Education, the Hon. John Della Bosca, has announced he is asking the NSW Board of Studies to review the study of Australian literature in NSW schools (Della wants more Australian Literature in the curriculum).
This is good news for Australian literature and Australian authors.
The news has been welcomed by the ASA and Chair of the Literature Board of the Australia Council, Dr Imre Salusinszky.

Australian Publishing: Don't forget the authors

Australian publishing industry exports have increased markedly in the past few years. In 2003-4, the export of Australian books, titles and rights was worth more than $195 million.
This fact alone makes the publishing industry Australia's leading creative industry. But, like almost all creative industries, it is the creators themselves who are least likely to benefit from the success of the industry.
Some Australian authors certainly do well, but publishers do better. It is important for authors that publishers makes profits so they can pay royalties, but surely it ought to be as important to publishers to ensure authors share in their success.
Apparently not.
Publishers like to place clauses in their contract that reduce royalties for reprints of 1000 copies or less, even though they will have made back their investment on the first print run. Another trick is to reduce royalties rates for other than the initial version of the work, say a mas-market edition, again flying in the face of publishing economics in that further editions maximise the earning for the publisher. That's the way publishing works, after all. And I say that with over 30 years experience in the Australian publishing industry as a publisher.
In the success of the Australian publishing industry, there seems to be some darkness for authors.
But we have to remember our past and learn from it and seek opportunities where we can.
The years 1940 and 1941 were dark indeed for Australia. Japanese forces moved steadily southwards, Darwin was bombed, the Brisbane line was drawn.
But in this darkness a benefit emerged for Australian writers. The Australian government, needing to maintain capital reserves, imposed an embargo on American imports, including books and paper. Suddenly, Australian writers were being sought to produce detective fiction, Westerns and other novelettes published to meet public demand. Writers no longer had to hawk their wares to London publishers. One of the writers who found his detective books being published locally was Alan Yates (“Carter Brown”), who later became a member of the ASA’s Committee of Management at its second meeting in September 1963.
Jon Cleary, who is still an ASA member, began to be published in Australia in the early forties, along with other early ASA members such as Morris West. The restrictions on imported books remained until 1959. A book bounty was introduced in 1969 to encourage printing in Australia, but by that time a pattern of reading Australian writers had been established.
Still, Australians’ literary diet today is spiced with writers in English from India, Canada, the UK, the US, and occasionally New Zealand, as well as Australia. Unfortunately, that means the competition for Australian writers in their own market is actually greater than that for American writers in theirs.
Australian writers are further disadvantaged by the fact that most of the 20 largest book publishers in Australia are divisions of multinational corporations whose accountants are based in New York, Paris, London or Berlin. The corporate eye is on return on investment, not, as in the days of Brian Johns at Penguin, the development of a thriving Australian publishing industry. A new author now is required to be instantly successful, able to sell the same number of books as an author who has crafted a reputation over a significant period of time. Authors whose books fail to meet these sales expectations are brutally dispensed with.
But sometimes we can spend too much time lamenting what’s wrong, and miss opportunities to improve our situation. Again, we can turn to history for guidance.
In 1905, the United States was in a similar situation to that which it is in today in that it had a Republican President (Theodore Roosevelt) who intervened in foreign countries (Panama) for American benefit.
Australia was quietly developing its newly won nationhood. Secure within their newly-federated island country, the citizens throughout Australia were placing plaques in churches and town halls to commemorate those who had served in the Boer Wars. Ten years later, the same people were counting more war dead, a count that would continue until late in 1918. Hugo (Jim) Throssell, husband of Katharine Susannah Prichard (a member of the ASA from 1964), was one of the lucky survivors of World War I, but survival did not ensure happiness. In 1933, he took his own life while his wife was travelling overseas.
Well before this, towards the end of 1905, Miles Franklin began planning a trip to London, of two minds about the success of My Brilliant Career. It had sold well, but most royalties were on “colonial sales” (copies sold in Australia) and earned only half the rate of those sold in the UK.
Nearly 60 years later, colonial rates was one of the issues that led to the formation of the ASA in 1963. The first Australian writer to have this anachronism removed from her contracts was Dymphna Cusack, an inaugural member of the Council of the ASA. The first issue of Broadside, the ASA’s first newsletter, reported that at least six British publishers had agreed to negotiate colonial rights, and, thanks to the ASA’s work, these unfair royalties have disappeared.
Regardless of the political situation in Australia or internationally, regardless of the waxing and waning of literary fashion, the ASA continues to stand for increased returns for writers and to argue for more channels of remuneration. There will always be some sad circumstance for us to lament—that is perhaps why some of us write—but nothing should stand in the way of writers achieving the right to maintain a living.
The ASA has achieved a great amount over the past 40 years. It also won Public Lending Right and achieved success with Educational Lending Right. The ASA was also instrumental in the establishment of the Copyright Agency Ltd (CAL), which now provides another income stream for writers, especially those in the education sector, for the photocopying of their work. It has also established minimum standards for book contracts.
But despite all this work there is still much to be done. In my office I have in front of me a contract from a publisher that asks the author to assign copyright to the publisher, which would spell the end to any additional remuneration -- such as a CAL payment -- for the author. As well, the contract offers a flat fee upfront and royalties only after the sale of 3200 copies, which may have an impact on the author’s right to Educational Lending Right (ELR).
These are issues of core interest to writers. The everyday task of improving the ability of writers to be able to make a living remains central to the ASA.
The publishing industry might be successful but the fight for authors to make a living from their writing continues.
Some of this material has previously appeared in Australian Author. Copyright © 2007 Australian Society of Authors/Jeremy Fisher

Arts Funding: Creators second fiddle

Arts commentator Marcus Westbury had an interesting article in the Sydney Morning Herald of 18 October 2007 (the link to it is above).
His article made me think about how we fund creativity in Australia. Like Marcus says, we actually give more to "cover bands" than we do to original artists.
Let me give you some facts. When we start comparing contributions from different creators to Australia’s cultural life and development we can see creators, and authors in particular, are undervalued. We can see this through government funding.
In Australia, the Australia Council for the Arts funds artists and creators with grants and operational money. For instance, the Major Performing Arts Board of the Australia Council dispensed $78,182,476 to the performing arts in the period 2005-06.
Opera does especially well from Major Performing Arts Board funding. Opera Australia and the Australian Opera and Ballet Orchestra received over $14.5 million dollars between them.
If you like opera, that’s terrific! If you don’t, you might wonder why anyone would spend $14.5 million on an artform that engages with very few people, either as performers and audiences. It’s not as if the funding supports Australian composers and librettists writing operas. The works performed in Opera Australia’s October 2006 season were from the composers Gilbert and Sullivan, Verdi, Janacek, and Handel. Dead European composers.
Of course the Major Performing Arts Board’s funding of opera also supports Australian singers and musicians and that is undeniably a good thing. The funds made available to Opera Australia provide living wages for musicians and singers, in fact around 1300 of them.
There is no way I would take funding away from these dedicated performers. Yet I can’t help but dwell on the fact that in the same period Opera Australia and the Australian Opera and Ballet Orchestra received their $14.5 million, the Literature Board of the Australia Council for the Arts dispensed a mere $4,526,308 in grants and funding to writers and organisations supporting writers. While this included seven fellowships of $40,000 and one Emeritus Fellowship of $50,000, it wasn’t exactly employment for authors. The allocation of funding in this way forces me to ask why is it that singers and musicians can receive a living wage from government funding yet the same is not true for authors. What I can’t understand is what makes the performance of a Verdi or Handel opera worth more than the writing of a book. That’s the logical conclusion you must reach regarding the funding of arts in Australia. Through the allocation of money in this way, the performance of opera works by dead European composers is valued more than the authorship of original Australian books.
This sounds like a whinge, but my argument is based on sound free-market facts. Despite its reputation as an artform appreciated by the high and mighty, opera is not a popular artform. In fact, very few people at all go to opera performances – only 294,000 in 2004. That’s a little more than 0.01% of the Australian population. It isn’t what I’d call successful market penetration by a vibrant, living cultural form.
And does opera make money? Not at all. It is highly subsidised. It doesn’t even make money on the recordings or televised broadcasts of performances.
Australian literature on the other hand earns around $100 million a year in Australian sales, even when it is claimed to be “in decline”. Why? Because Australians continue to read Australian books in significant numbers. According to BookData figures released through Books Alive, 35,230,246 trade books were sold in Australia in the first nine months of 2006 (that’s about 1.75 books for every Australian). Over 65% of those books are produced in Australia by Australians. That’s much greater economic success and market penetration than opera can claim. At the same time the ABS reports that there were 556,000 Australians who were involved in writing. That’s almost double the number of punters who rock up to the Opera House to sip champagne between arias.
So why is it then that 1300 performers and musicians can be paid a living wage and yet so few authors receive such compensation? Because we are not assessing government support for the arts in free market terms, that’s why. Why do we have this aberration in government policy? Surely not because MPs and Ministers like to hang out at “first” nights of an artform that reached its use-by date in the nineteenth century?
Regrettably, that may be exactly the reason, given the massive corporate sponsorship for opera from the likes of Exxon Mobil, IBM, Australia Post, Qantas and the Commonwealth Bank. But with this sort of corporate support, why does opera need government funding at all? If corporate Australia is so desperate to see another soprano warbling Wagner while mingling with Ministers, surely they can pay totally for the privilege.
Of course the soprano should still be paid a living wage. I’m not belittling the artistry involved in performing opera. I’m simply trying to value it in terms of its place in Australian culture.
I believe a strong argument can be mounted that only art forms that lead to the creation of new Australian works should be funded by the taxpayer.
All opera can claim in recent years is the creation of the Lindy Chamberlain opera and Batavia neither of which were mainstream successes as, say, Kate Grenville’s book The Secret River has been. On this basis, opera would be a big loser.
If opera’s funding was assessed according to this criterion, it would probably be about equal to its market size and its cultural significance; this is, not very much. The funding for literature on the other hand would be altered considerably, and more authors would be able to be paid a living wage.
So why isn’t literature getting this sort of funding? Is the truth that, as a nation, we believe dead European composers are more deserving of the money we allocate for the arts than living Australian authors? Are we still accepting a cultural cringe where we cannot accept living Australian creators are as good as if not better than dead European ones?
Or is our arts funding simply fundamentally flawed because it doesn’t follow free market principles?
Whatever, we undervalue authors.
Much of this material appeared in Australian Author, December 2006. Copyright © 2006 Australian Society of Authors/Jeremy Fisher.

ELR funding confirmed

The Minister for the Arts, Senator George Brandis SC, confirmed that funding for Educational Lending Rights (ELR) had been confirmed past 2008 on 8 August 2007 (see his press release here).

The Australian Society of Authors was instrumental in establishing ELR. The ELR program provides payments to eligible Australian creators and publishers on the basis that they are missing out on potential royalty payments when their books are borrowed from educational libraries rather than purchased. The Public Lending Right program (PLR) provides the same support for works held in public libraries.

ELR was established in 2000–01 as an element of the Book Industry Assistance Plan, offering compensation for the imposition of the goods and services tax (GST). It received funding of $35 million for the period 2000–01 to 2003–04. Following a review of the programme in 2003, $44 million was provided in the 2004–05 Budget to continue the scheme for the next four years. Further funding has now been confirmed. The Australian Labor Party has also made a commitment to further funding for ELR in its Arts statement.

The ASA calls for the capital pool for ELR to be increased to at least $16 million to allow for increases in the number of books to which it applies as well as to compensate for the static level of funding for the previous four years. The ELR pool should also be subject to the same indexation applying to the PLR pool (the ASA also calls for an increase of the PLR pool to $10 million).

The Australian Book Market: A brief economic outline

What research there is on the Australian book industry has been conducted comparatively recently. From 2000-2004, the Australian Bureau of Statistics (ABS) assessed the industry as part of the Book Industry Assistance Package given by the current Federal Government as compensation for the imposition of the GST on books. Data in this blog entry comes from the ABS.

The net sales value of the book market in Australia was $1,560.6 million in 2003-04, a slight decline from $1,578.6 million in 2002-03. In 2003-04, there were 234 businesses identified as book publishers and a further 10 identified as major contributors. In 2002-03, the overall operating profit (income, less expenses of $1,487.7 million and a reduction in inventories of $2.5 million) for the industry was $88.4 million (5.6%), but, even with a decrease in net sales value, 2003-04 proved a better year than the previous one with the overall operating profit rising to $152.1 million (9.7%) as expenses were lower at $1,404.4 million and reduction in inventories was $4.2 million. In 2003-04, 133 of 244 publishers were involved mainly in publishing books of general content while 111 were involved mainly with publishing educational books (including professional and reference books).

Just on 60% of the books sold in Australia originate in Australia accounting for sales in 2003-04 of $811.9 million. This is a vast change from 1960, when 75% of the books sold in Australia were imported, and 1980, when 63% of the books sold in Australia were imported.

However, the change in ownership of publishers has been insidiously the other way. Very few Australian companies feature on the list of the Top 20 publishers. However, it is interesting to note that the structure of the industry hasn’t changed much in over 20 years. In 1982, there were 200 active publishers in Australia, compared with 234 in 2003-04. In 1982, no publishers had a turnover of more than $40 million, and only 20% had a turnover of more than $2 million. The majority had a turnover of less than $1 million. This pattern was pretty much unaltered in 2003-04. While there are no publicly available figures on the turnover of most Australian publishing companies because they don't have to report to Australian authorities or are privately owned, it is possible to gauge their size through their reported activities and the annual reports of their overseas owners. As well the ABS has reported (the only year it has done so) that in 2000-01, the 20 largest book publishers in terms of income earned an average of $52 million each, while the remaining book publishers earned an average of $2 million. Overall the 228 businesses involved in book publishing in that year earned an average of $6 million each.

These facts need to be placed in a global context. For example, the international operations of Harcourt Education (purchased by Pearson in 2007), which include Australia, had an operating profit of A$69.6 million for the six months ended June 2004, the 2004 world-wide revenue for McGraw-Hill in 2004 was A$3,050 million with an operating profit of A$432 million, and the 2003 world-wide revenue for Random House (part of privately owned, German Bertelsmann) was A$2,940 million. In other words, the Australian market is a very small part of global publishing, and the global activities of some of the larger publishers operating in Australia are larger than the entire Australian market.

Closer examination of the Australian market reveals that 77% ($1,198.3 million) of the 2003-04 total income for publishers and other major contributors was generated by the 20 largest (in terms of income) book publishers. These 20 publishers were equally as significant in sales, selling 78% ($1,057.8 million) of the value of total book sales and 76% (97.7 million) of all books sold, but their profit margin was lower than that for the overall industry at 9.5% in 2003-04 while it was 12.7% for the other publishers. Mind you, that's not a bad return!

Educational Publishing in Australia: what's it worth?

There is no comprehensive analysis of sales in the educational market. Statistics have not been collected since 2004 as the Australian Bureau of Statistics (ABS) no longer received funding to do so.

Currently, the education sector represents the largest publishing segment. It was worth $547.8 million in 2002-03, with $342.5 million of that resulting from Australian published material, but had dropped to $526.1 million in 2003-04. Of the 2003-04 sales, books produced in Australia were worth $343.4 million or 65% of educational sales. Most of these were for school use, the largest proportion of imported titles being used in tertiary education, though the number of imported titles being used in schools is growing and is a worrying trend for both culture and income for educational writers.

The decline in sales of educational books reflects international patterns and perhaps the influence of internet in education. Copyright Agency Ltd (CAL) is reporting a greater rate of copying of material available on the internet. Its market size had increased year by year since 2000 but plummeted to $498.8 million in 2003-04 (Table). There were 4615 new Australian educational titles published in 2002-03 and 4610 in 2003-04.

Table: Income from sales in the educational publishing market in Australia 2000-2004
Period Australian Education (m) Imported Education (m) Total (m)
2000-01 $295.9 $178.4 $474.3
2001-02 $310.2 $209 $519.2
2002-03 $328.4 $205.3 $533.7
2003-04 $313.2 $185.6 $498.8

Source: ABS