Words & figures: Rewriting the rules of book deals

It’s a financial renaissance for pop icon Britney Spears. Her $15 million tell-all memoir deal with publishing giant Simon & Schuster in February this year is being regarded as her first major earning potential since her 13-year conservatorship was terminated in November 2021. In fact, it is also expected to smash the record of other memoirs so far—those of Bruce Springsteen ($10 million in 2016), Rolling Stones guitarist Keith Richards ($8 million in 2010) and comedian Amy Schumer ($9 million in 2015). Spears’ deal is also greater than UK PM Margaret Thatcher and Pope John Paul II, who received $11.3 million and $8.5 million, respectively, for their memoirs.

At one end of the spectrum is Spear’s lofty deal in international publishing; on the other is the recent closure of Amazon’s Indian publishing company Westland Books—five years after it was acquired by the e-com giant from Trent, a subsidiary of the Tata Group, in 2017. March 31 was the last day of its operations. News reports suggest over Rs 47 crore losses in 2019, Rs 35 crore in 2020, and over Rs19 crore in 2021.

Revenue losses, high distribution costs and book marketing that eat into the profitability have been cited as a few reasons for the abrupt closure of a publishing house like Westland, besides a roster of top-selling authors like Chetan Bhagat, who was reportedly paid over Rs 35 crore for a six-year superior deal. Another author in their list, Amish Tripathi, was reportedly paid Rs 50 million advance for the south Asian rights to his trilogy, which was the biggest deal struck by Westland. Besides Tripathi, other names like Ashwin Sanghi, Devdutt Pattanaik, Ashok Banker, Harsha Bhogle and Preeti Shenoy were also in their commercial category list.

“The offer was made on the basis of not only the past sales record but also in our belief in Tripathi as a writer and his ability to deliver another blockbuster trilogy,” Gautam Padmanabhan, chief executive of Westland, said in a media interview in 2013 when the company signed Tripathi.

Given the business landscape of the Indian publishing ecosystem, the dynamics of book deals have changed over the years—largely due to sound acquisitions that offer scale, money, and publishing bandwidth in many cases. Even though efforts are being made to revive the publishing business that was hit in 2020, the sale of books has slumped with the rise in the adoption of digital e-books.

According to a report titled, ‘Value proposition of Indian publishing’, by the Association of Publishers of India and EY-Parthenon, the Indian publishing industry was pegged at Rs 500 billion in 2019 and was projected to reach Rs 800 billion by 2024. India is the third-largest publisher of English language books, with industry participants estimating a 10 %to 15% share of foreign publishers in the market. Educational literature forms the majority of this revenue, followed by culture and recreation.

Deal breakers

If a seasoned or celebrity author is widely accepted to sign a deal for a book to sell well, the author acquisition is primarily based on a profit/loss estimate keeping in mind projected sales. “The projected sales are arrived at after taking into consideration various factors like profile of author, successful past publications, the book proposal received from the author, etc. The advance offered and marketing plan drawn up for a book also hinges on these factors,” says Himanjali Sankar, editorial director, Simon & Schuster.

However, it is neither fair nor possible to measure book deals simply in numbers, says Sohini Mitra, publisher, Children’s Division, Penguin Random House India. “We evaluate the qualitative aspects as the deal is part of a new or ongoing relationship with an author. Factors like time required to prepare the book and the potential of the author are kept in mind before signing,” she adds.

While one signs a big author for branding purposes, without being sure if the money invested can be recovered fully or partially, it can drain a publishing house in the long run. “The advantage of such deals is that the publishing house gets visibility and if the deal pays off then it works well for both the author and the publisher in terms of profit and publicity. Such risks must occasionally be taken as it is important for authors to feel treasured and respected for the work they put into a manuscript,” adds Sankar of Simon & Schuster.

Deals should logically depend on the perceived saleability of the book, shares Thomas Abraham, managing director, Hachette India, who has published titles like My Life in Full by Indra Nooyi, Mind Master by Vishwanathan Anand and Limitless by Radhika Gupta.

Market dynamics play a crucial role at the time of advance payment. “Since readership for books across the board is on the rise, authors all over the world can continue to earn good royalties from book sales, and commensurate advances,” says Udayan Mitra, executive publisher, HarperCollins.

However, the financial situation for authors hasn’t changed much because of low or late signing amounts. Delhi-based author Geetanjali Shree, whose book Ret Samadhi—translated into English as Tomb of Sand—recently became the first translated Hindi work and the first book written in an Indian language to win an International Man Booker Prize, feels there is increasing complexity of agreements with publishers. “In my 30 years of experience, money-wise, the situation has remained the same. Punctual annual statements and royalty payments are not a norm. A few authors manage to obtain an advance against royalty at the time of signing the agreement. I doubt if serious authors can survive by writing alone,” she adds.

According to Bangalore-based author Aakar Patel’s experience, signing amounts (against royalty) are low. “For non-fiction in my case between Rs50,000 and Rs2 lakh, this is against royalty. The reason for the low amount is that Indians don’t buy or read books compared to the West and other democracies like Japan. Low sales and (to a lesser extent) low cover prices mean low royalties. Most non-fiction books can make the bestseller list with print runs of less than 5,000 copies,” says the author of Why I Write, a translation of Saadat Hasan Manto’s Urdu non-fiction (Tranquebar, 2014), Our Hindu Rashtra: What It Is, How We Got Here (Westland, 2020) and Price of the Modi Years (Westland, 2021).

As per author and screenwriter Meghna Pant, who has published eight books, including the recent bestseller Boys Don’t Cry by Penguin Random House, there are no big billion deals for most Indian writers barring a few. “On an average, a debut author gets paid Rs 30,000-40,000 (or less for poetry or short stories) as a book advance. Unless you’re a neta, abhineta, celebrity, or Priyanka Chopra’s dog, don’t expect more,” says Pant.

At the top of the advance, one receives royalties from the publisher, and on an average a new author gets a royalty of 7.5% on a paperback edition and 10% on hardback copies. This means that if the book is priced at Rs 300, one will get Rs 22.50 per book sold, before taxes. The pay-out of royalties is stipulated in the contract and is typically half-yearly. One has to sell 2,000 copies, the entire first print run, to earn less than Rs45,000. There are very few authors who manage even this.

There are several examples where publishing houses haven’t even been able to recover high advances, leave alone break even. Unless a publishing house has a strong backlist, high advance-led front list titles would not sustain the operational or any other costs. “What may bring relief is that some go on to win awards or win great OTT or screen deals to cover up for the losses. Books to screen are becoming a great way of making up for the gap as publishers also get their share from the deals. Sometimes a book may seem to be too expensive given the advances paid but ends up winning a big international award that then brings it back into high circulation,” adds Lipika Bhushan, who is the chief marketing officer of MarketMyBook, a publicity and digital marketing agency.

Cutthroat competition

Payments and acquisitions in India as compared to the West are unmatchable if confined to big international publishers operating at an altogether different scale of economy. However, there are smaller, often prestigious, publishers abroad and there is a great difference in what the two, on average, pay their authors. “The comparison is further skewed by the conversion of pounds and euros in rupees and by ignoring the standard of living in the West and in India,” says author Geetanjali Shree.

The advances offered in India are usually less than those offered by the international counterparts. “In the case of authors who have a huge profile or a history of high sales there can be an auction and the signing amount can be astonishingly high in some cases,” says Sankar of Simon & Schuster.

It also depends on the market conditions. “While the industry is evolving, offers should be competitive so that it values the work and sells the book,” adds Milee Ashwarya, publisher, Ebury Publishing and Vintage, Penguin Random House India.

Also, the scale of readership is higher in the West. “The higher end advances would be proportional to those in the west for the million copy sellers. And ironically, the biggest royalty earners are not fiction writers but textbook writers who have had royalties in crores over 20 years ago,” adds Abraham of Hachette India.

While a good signing amount is a very relative term and some of the biggest names in Indian writing have been signed for crores, it is nothing compared to what international publishers offer. “More often than not, Indian writers are of international acclaim. Many international writers have agencies and estates handling deals for them. The value in dollars is incomparable with what Indian publishers or international publishing houses in India can offer. The big deals are signed internationally and include rights for Asia whereby Indian wings of these international publications get to publish and distribute locally too. The reason is in the fact that India only contributes to about 10% of the total sales for some of the international publishing houses. So, only that much can be set off against a regional office,” shares Bhushan of MarketMyBook.

Multinational publishing houses like Penguin Random House, HarperCollins, Hachette and Bloomsbury are backed by international markets as compared to Indian independent publishing houses like Rupa Publications, Niyogi Books and Zubaan Books, which are mostly family owned. Hence, the system of acquisition or royalty advances or signing amounts is different and cannot be matched with Indian independent publishing houses, as per Trisha De Niyogi, COO and director of Niyogi Books.

“Regional publishers in other Indian languages cannot match the standards of royalty and advances of independent publishing houses publishing in English. Within the relative spaces, both the publishing houses and authors are more or less comfortably placed today. For instance, Shankar and Samaresh Majumdar in Bangla, Amitav Ghosh and Anand Neelakantan in English and BN Goswamy and Alka Pande in the space of illustrated publishing,” she adds.

A select few Indian authors do well internationally because of a cult status that depends on monetary value or creative merit. Renowned writers Vikram Seth and Amitav Ghosh have had a loyal fan base globally and earned bigger advances and included rights to the UK and US markets. Seth’s big-money book A Suitable Boy in 1993 by HarperCollins had him pay a $600,000 advance, and backed it up with a $200,000 marketing campaign, a superior advance for a bestseller with a $30 tag.

At the international level, Penguin has a history of lucrative deals for high-profile writers like Barack and Michelle Obama in a $65-million book deal and Prince Harry with an advance of $20 million for his upcoming memoir.

Bestselling British author Jeffrey Archer had once said in an interview that he prefers selling 270 million books over winning the Booker Prize. Last year, he signed a major three-book deal with HarperCollins. In 1990, HarperCollins bought the three books of Archer (two novels and a collection of short stories) in addition to buying hardcover and paperback rights for the US and Canada, as well as foreign rights except for the UK and Japan. The publisher also acquired the movie, television and audio rights. The author was reportedly offered $15-20 million.

When asked to confirm, Archer said in his media interviews, “’I’m not allowed to answer that, but it certainly didn’t go below that figure.” Archer has sold 3.8 million books for £25.3million since 1998 in the UK, with the Clifton Chronicles selling around 1.07 million copies.

However, many successful Indian authors are empowered to change publishers. Bestselling author Anuja Chauhan went back to HarperCollins after publishing a book with Westland which assured more money, numbers, and publicity. Chauhan had published her first three books—The Zoya Factor (2008), Battle for Bittora (2010) and Those Pricey Thakur Girls (2013)—with HarperCollins, before going to Westland for The House That BJ Built (2015). Her fifth novel, Baz, was published in April 2017.

Chetan Bhagat switched from Rupa Publications to Amazon to publish six new books for better exposure, despite his books being estimated to have sold seven million copies. “Many writers switch publishing houses, but most do it if they find a more passionate editor for their work and rarely for bigger advances, for the differential between big publishing houses doesn’t amount to much. Most people write books out of passion, and not to make money, for writing does nothing for your bank balance. Only the top few bestselling authors in India make enough money to write full-time. Unless you’re born rich, build a secure financial foundation before taking up writing full-time,” says Pant, who took to writing books after ten years at a regular job.

Since readership across the board is on the rise, authors can continue to earn good royalties & commensurate advances
— Udayan Mitra, executive publisher, HarperCollins

Regional publishers in Indian languages cannot match the standards of royalty and advances of those publishing in English
— Trisha De Niyogi, COO & director, Niyogi Books

India only contributes to about 10% of the total sales for some of the international publishing houses
— Lipika Bhushan,CMO, MarketMyBook

Biggest royalty earners are not fiction writers but textbook writers who have had royalties in crores 20 years ago
— Thomas Abraham,MD, Hachette India

* $65 million
Barack & Michelle Obama
Book deal with Penguin Random House in 2017

* $65 million
Margaret ThatcherTwo-book deal with HarperCollins in 1993 & 1995

* Rs 50 million
Amish Tripathi
Advance for south Asian rights to his trilogy in 2013

* $8 million
JK Rowling
Advance for The Casual Vacancy in 2012

* $15 million
Bill Clinton
Advance for his autobiography in 2004

* $15 million
Britney Spears
Tell-all memoir deal with Simon & Schuster in 2022

* $8.5 million
Pope John Paul II
Advance for Crossing the Threshold of Hope in 1994

* Rs 35 crore
Chetan Bhagat
Six-year superior deal with Westland in 2018