One of the most important things to remember when buying and
selling subsidiary rights is that every right can be cut into as many pieces as
you want. If you want to maximize your subsidiary rights income and at the same
time retain greater control over your intellectual property, learn how to slice
and dice rights. Below are a few of the ways that you can do that.
First and second — When selling magazine reprint
rights, you can sell first serial rights and second serial rights. First rights
are those sold for publication before the book’s publication date. Second rights
are those sold after the book has been published. You could use a similar
breakdown for selling some other rights as well.
Duration — Any right can be sold with a time limit
attached. For example, mass-market reprint rights are often sold for a set time
limit, from three to seven years. Foreign rights are also often limited to a
certain number of years. If you have any concerns about the rights buyer, one of
the best ways to retain control is to set a time limit for those rights.
Timing — In addition to setting a limit, you can also
require that the buyer exercise the right within a certain time period. If they
fail to exercise it during that time, rights revert back to you. When I sold
Chinese rights to 1001 Ways the first time, the publisher failed to publish an
edition in the time required so the rights reverted back to me. As a result, I
am able to sell the Chinese rights to this new edition without any conflict with
an old edition still being out there.
You could also set a time limit on when they can begin to
exercise the right. For instance, to give your hardcover edition time to sell,
you can require that a mass-market publisher wait one year from the signing of
the contract before publishing their edition.
Grant an option — Movie rights are often sold with an
option first. The option allows a buyer to pay a smaller amount while trying to
put a deal together. If he can’t put the deal together, then the rights revert
back to the seller without a high cost to the buyer.
Format — Rights are naturally broken down by format:
book, audio, video, electronic, performance, etc. I’ve already outlined most of
these format possibilities in the previous points. In any rights contract, be
sure to specify exactly what rights you are granting. All other rights should be
retained by you.
Sub-formats — You can also sell rights by sub-formats.
For example, sell book rights to reprint in hardcover, trade paperback,
mass-market paperback, limited edition, miniature format, etc. Each of these
rights can be sold separately.
Medium — When selling some rights, you can also
restrict the rights to specific media. For example, break down audio rights to
records, audiotapes, CDs, and mp3 in addition to any new audio formats to be
created. The best way to do this is to specify the actual media that the right
includes and exclude all others unless the buyer also wants to buy the rights to
reproduce audio for those media. You can do the same with video, books, etc.
Pieces — You can sell rights to pieces of the book, not
just for serial rights but also for reprinting as premium editions, miniature
books, pocket guides, purse books, etc. Don’t think you have to sell the entire
book. Sell whatever portion a buyer wants to buy. Retain rights to the rest to
sell to another buyer (even a competitor to the first buyer).
Abridgements — Audio rights are often broken down to
abridged or unabridged rights, but you can do the same for book rights, video,
electronic, or other formats. By distinguishing between abridged and unabridged,
you can sell the same format or medium rights more than once. For example, the
first Chicken Soup for the Soul book also was reprinted in an abridged
version as A Cup of Chicken Soup for the Soul.
Dramatic rights — With audio especially, you can
distinguish between dramatic and non-dramatic readings of the book. But you
could possibly do the same with video and performance rights.
Exclusivity — With any right, you can sell an exclusive
or a nonexclusive right. Whenever possible, sell nonexclusively. If someone
wants an exclusive, they should pay more for that right. While some rights
require exclusivity (e.g., translation or movie rights), others can readily be
sold on a nonexclusive basis (e.g., serial or book club rights).
Audience — You can limit the exercise of a right to a
specific audience. For example, you could sell first serial rights to an excerpt
to a travel magazine and sell the same excerpt again to a food magazine—if you
have limited the serial right to a specific audience.
Markets — You can grant one publisher the right to
publish a book for the religious market and sell the book rights for the general
bookstore market to another publisher. Or you can sell book rights to a
publisher but retain rights to publish and sell another edition to premium and
Means of reaching a market — In selling rights, you
could distinguish between the means a publisher uses to reach a market. For
example, you could sell the rights to publish the book for the bookstore market
but retain rights to sell via mail order, telephone sales, the Internet, etc. If
you retain such rights explicitly in a contract, you are free to exercise those
rights later yourself—or sell them to someone else. This could be critical if
someone wants to build an infomercial around your book.
Territory — You can restrict any right by the territory
where it is used, for example, North America, France, Spain, South America, etc.
While this restriction is most used in selling foreign rights, it is possible
for you to set regional restrictions within a country as well. I don’t know when
that would be practical or reasonable, but don’t rule it out.
Language — All subsidiary rights can be sold separately
for every language on earth (if someone is interested in buying them).
Generally, when you sell translation rights to your book, the foreign publisher
also specifies the right to many of the subsidiary rights within that language.
The most important subsidiary translation rights are serial, book club, audio,
and electronic rights. Note: You would not sell movie rights in another language
because then you’d be undermining your ability to sell movie rights in English.
Editorial restrictions — When selling any right, you
can always specify your right to approve any editorial changes. This could be
important if you are concerned about the integrity of the content, especially
when selling condensation rights, reprint rights, or translation rights. Such
restrictions can also be important when licensing merchandising rights so that
your brand image or title is not used inappropriately on t-shirts, calendars,
posters, coffee mugs, etc.
Advertising restrictions — If it is important how your
brand is presented, you should also set advertising and promotional restrictions
so that the buyer doesn’t advertise your brand inappropriately.
Other restrictions — When selling rights, read any
contract offered you as carefully as possible. Similarly, when offering a buyer
a contract to license any rights, be sure to include every point that is
important to you. If you have any other concerns, be sure to specify them in a
contract. All rights are fully negotiable. Set any restrictions you need to set
to be comfortable in selling a right.
Performance clause — You can always sell or license any
right with a performance clause attached that says if they don't sell enough
copies or don't perform in some other specific way, the rights revert back to
you. Performance clauses are especially important when your income is based on
Minimum sales clause — Many merchandise licenses are
sold with the restriction that royalties will be paid on a minimum number of
sales regardless of whether or not the licensee makes that many sales. Rights
don't necessarily revert back to the licensor but at least as the licensor, you
make the minimum you require for the exercise of that specific right.
The world can be yours, or at least one billion dollars of it (as is the case
with the world’s first billionaire author, J. K. Rowlings), if you know and
understand how intellectual property rights work. Don’t be stupid. If you don’t
know what you are signing, don’t sign it. Keep asking questions until you are
satisfied you understand exactly what rights you are granting and how you will
be paid, how much, what kind of accountability is in place, etc. You can’t be
shy when it comes to your intellectual property rights. Stand up for your
1001 Ways to Market Your Books, 6th Edition describes more than 1,000
ideas, tips, and suggestions for marketing books — all illustrated with real-life examples showing how other
publishers and authors have marketed their books.