The war of words between Random House and the Science Fiction & Fantasy Writers of America continues.
On Wednesday, Digital Book World was the first to report that the SFWA had sent a letter to its members saying that publishing a book with Hydra, a new digital imprint from Random House, was not enough to qualify a writer for membership in the association. The SFWA condemned the terms of the contract that Hydra offered writers, especially that it pays no advances.
Authors across the Web joined in to criticize Hydra, at best calling its contract terms “unattractive” and at worst, in the case of one commenter in a post criticizing the contract, “stupidly exploitative.”
Digital Book World expert blogger (and start-up publisher) Bob Mayer defended Hydra, viewing it more as a new business model, but also added that some elements of its contracts were unduly onerous on authors.
Random House digital publishing director Allison Dobson wrote her own letter to the SFWA explaining the Hydra business model and why it is “potentially lucrative” for authors. Basically, as opposed to the traditional publishing model of offering an advance on royalties (essentially, an investment in the future profitability of a work), Hydra has authors and publishers share the risk in producing a work and share in the proceeds. Hydra takes on some of the risk in spending time and effort to help bring a book to market and the author takes on the risk of spending time and effort producing the work. Hydra then takes the first slice of profit to cover its costs and the rest are split between the author and publisher.
With Hydra, Random House is trying to find a hybrid business model for publishing that would allow it to brings its know-how and resources to bear on bringing new works to market while absorbing less of the risk and thereby being able to tap a different level of writer — one who, by definition, would be more risky for the traditional publishing business model.
The SFWA, as is its right, is unsympathetic, firing back its own letter to Dobson. Here are some excerpts:
SFWA has determined to its own satisfaction that Hydra does not meet our minimum standards for a qualifying market, as its contract does not offer an advance. Additionally, your attempt to shift to the author costs customarily borne by the publisher is, simply, outrageous and egregious.
You extol your business model as “different”; the more accurate description, we believe, is “exploitative.” We are particularly disappointed to see it arising out of Random House, a well-regarded, long-standing publishing firm. Bluntly put, Random House should know better.
SFWA will now be watching Random House very closely. If the egregious features of Hydra and Alibi’s contracts begin to make their way into the contracts of Random House’s other imprints, particularly Del Rey and Spectra, we will be required to act, up to and including delisting Random House as a whole as a qualifying market for SFWA.
We urge you to reconsider your business model for Hydra and Alibi. It is bad for authors, it is bad for the publishing industry, and it is extraordinarily bad for the reputation of Random House as an equitable partner for writers.
Read the full letter here. The SFWA has an interest in encouraging publishers to pay authors advances and give them ever more lucrative contracts where the publisher bears more of the risk.
Random House has been contacted for comment but has not yet responded.