by James Scott Bell
@jamesscottbell
Two things caught my eye this week I think you should know about.
1. The End of the Noncompete Clause?
Traditionally published authors authors take note (and discuss with your agent): The Federal Trade Commission has issued a rule banning noncompete clauses. Under the rule, existing noncompetes for the vast majority of workers will no longer be enforceable after the rule’s effective date on Sept. 4, 2024.
The Authors Guild applauds the rule:
The Authors Guild has long objected to non-compete clauses and advised their removal in our contract reviews. These clauses, which are purportedly designed to protect publishers’ investments by preventing authors from selling the same or substantially similar work to another publisher, are often too broad. Authors are routinely asked to agree not to publish other works that might “directly compete with” the book under contract or “be likely to injure its sale or the merchandising of other rights.” Even more broadly, they may be asked not to “publish or authorize the publication of any material based on the Work or any material in the Work or any other work of such a nature such that it is likely to compete with the Work.”
Such open-ended non-compete clauses can prevent authors from pursuing other writing opportunities. If a new project even arguably deals with the same “subject” as the book under contract, the non-compete can be invoked to prevent an author from publishing elsewhere. For writers specializing in a particular subject, this could be career-derailing.
Certainly an author shouldn’t “compete” with their trad book by, say, self-publishing a similar book in the same season, etc. The publisher does deserve some protection for their investment, and your full marketing effort to help the book succeed.
On the other hand, a writer should be free to make more dough without the threat of a noncompete hammer coming down upon them. Thus, I have advocated for a more specific and fairer noncompete. But that may be moot in view of this new rule.
However, keep watch, for there are grounds for a lawsuit challenging the rule. Indeed, one of the Commissioners strongly dissented:
The rule nullifies more than thirty million existing contracts, and forecloses countless tens of millions of future contracts. The Commission estimates that the rule could cost employers between $400 billion and $488 billion in additional wages and benefits over the next ten years—and does not even hazard a guess at the value of the 30 million contracts it nullifies.
His reason for dissenting is that “an administrative agency’s power to regulate … must always be grounded in a valid grant of authority from Congress. Because we lack that authority, the Final Rule is unlawful.”
We shall see.
2. Can New Writers Still Have a Career?
It is “staggeringly difficult,” according to industry vet Mike Shatzkin.
You don’t have to be an insider to know that there were 500,000 titles in English available in 1990 and that more than 20 million are available from Ingram (thanks to print-on-demand) today. And that everything that was ever made available remains on sale through “normal channels” (which is “online”, not “in store”) forever. It doesn’t take a math genius to reckon that a pretty stable total book purchasing and readership constituency will result in dramatic reductions in sales per title.
In a meeting with publishing vets, he came away with this:
One agent has two clients who are successful self-publishers (there are subsidiary rights and foreign rights to occupy an agent.) Two things stood out about them. One is that they both published exclusively with Amazon, without the complement (which I would have thought would be “standard”) of also working through Ingram. The other thing was that they both started working their genres (and they publish exclusively genre fiction) in 2008 or so, before the rush of self-publishers in genres had saturated the market. So they established their brands in their genre marketplace when the competition was still minimal. The agent reports that both of these authors don’t believe they’d be successful starting to do this today.
JSB: I don’t agree with the last statement as a “rule.” The goal for a writer today is not wide distribution, but growing an “own list.” That can still be done, if the quality is there. True, the “breakout novel” is rarer than ever, but it has always been the exception. The writers who make a good chunk of change over time deliver quality product that grows a readership, which they nurture via email list and some social media presence.
It is, indeed, almost impossible to get a significant advance from a publisher unless sales are assured either by a highly branded author or an author platform of some kind that has significant promise for marketing and sales.
JSB: True that! And if that noncompete rule holds up, I would expect advances to be lower to nonexistent.
Comments welcome.
Welcome news, Jim. Thanks for sharing.
Your earlier post said it all:
“Publisher = deep pockets.
Author = pockets with holes”
And indies fill their own pockets. 😁
Thanks for the heads up, Jim.
This stuff makes my head spin. If you happen to see it rolling down the road, let me know, OK?
🙂
I’ve got my butterfly net ready.
Haha!
🙂
Good news about the non compete clause, Jim. As an indie, it doesn’t directly affect me, but it’s good to hear.
I’m with you about growing my “own list.” Honestly, I’m very grateful for opportunities digital publishing provide us. Things are different, there is way more “competition” but we can put our best work out there, and still find readers.
Good work will always find readers, Dale. That’s the nice thing, and it’s especially nice when they take the time to write and tell us!
Hmm. I’ve signed my share of traditional contracts over the years, and I don’t remember ever seeing a noncompete clause in its classical, business-related form. I can’t even conjure a reason why my publisher wouldn’t want to do a pop-up contract for a series-related novella, or why they would want to get in the way of a series-related short story for an anthology. Everything is cross marketing.
What every traditional contract does have is an options clause. Here’s the one from the contract I just signed for the next two Grave books:
“16. OPTION FOR NEXT WORK
The Proprietor agrees to submit to the Publisher a detailed
proposal and sample chapter for the Proprietor’s next book length
thriller in the Jonathan Grave series before submitting the same
to any other publisher. The Publisher shall be entitled to a
period of sixty (60) days after the submission of the proposal and
chapter, which period shall not commence to run prior to one month
after the acceptance of the last of the two volumes of the Work
covered by this Agreement, within which to notify the Proprietor
of its decision. If within that time the Publisher shall notify
the Proprietor of its desire to publish the manuscript, it shall
thereupon negotiate with the Proprietor with respect to the terms
of such publication. If within thirty (30) days thereafter the
parties are unable in good faith to arrive at a mutually
satisfactory agreement for such publication, the Proprietor shall
be free to submit the manuscript elsewhere.”
There’s nothing onerous there, just a first-look right of first refusal. If I had my heart set on moving on, all I’d have to do would be to reject their offer.
Of course I’ve not seen any of your contracts, Brother Gilstrap, but I’m willing to bet a couple of martini’s there’s language in some of them about agreeing not to publish “competing works” or “substantially similar works” which are likely to “injure the sales” of the work, or words to that effect. It’s been boilerplate for decades.
You’re right about “cross marketing” with similar-themed work, and discussing plans with your editor would be called for. But what if a traditionally published thriller author is just dying to self-publish a dragon erotica series? A publisher might take a bit of umbrage at that during the sell season of the contracted book.
Your option clause is better than the standard that gives the publisher the right to acquire “on the same terms and conditions” as the Agreement. But that’s because you’re Gilstrap, and you’ve got heft…and a good agent…and a publisher who likes you!
Here it is, I guess: “The Proprietor agrees that during the term of this Agreement the Proprietor will not without the written permission of the Publisher, publish or permit to be published any material in book, magazine, pamphlet, or newspaper form, based upon the material in the Work AND which is reasonably likely to injure its sale.” (Emphasis mine.)
That’s actually the entire paragraph. Hardly onerous, and “based upon the material in the Work” in no way limits me from writing my young adult new age zombie-dragon romantic suspense trilogy. (Whew, you had me worried.)
Now, I have no way of knowing how much my contract differs from the off-the-shelf version thanks to the efforts of my agent, because that’s what agents do.
Yes, that’s the language. What’s the title of the paragraph? Many contracts use the title “Non-competition.” I expect that title to change now in publishing contracts. But the duty not to injure sales may survive in some form. The more specific language the better, which a good agent can negotiate.
Your agent did a good job getting the “based upon the work” language in there. Now write that trilogy!
The title of the paragraph is “Conflicting Publications”
That title may survive this rule, though the Authors Guild would disagree. There will be some court time over this, I’m sure.
Good morning, Jim, and thanks for the update. I signed with a traditional publisher about a month ago for my middle grade novel. I just re-read the contract, and there’s no non-compete clause.
I don’t have to rely on my writing to pay the bills, and I’m glad about that. 🙂
A rarity, Kay. So there’s nothing in the contract about you publishing other work that might “injure” the sales, etc.? That may well be a publisher that recognizes the current state of things, or feels that it would hurt them in attracting authors.
I’ve only had contracts with big publishers, and every one of them had a noncompete. A good explanation of why can be found on agent Steve Laube’s blog:
https://stevelaube.com/c-is-for-noncompete/
I don’t see anything that sounds like what you describe, but this isn’t one of the big publishers, so maybe that’s the reason.
Good news about the non-compete, Jim. Does this apply to US only? I’m wondering if small presses outside the US need to honor this change.
The rule would apply to any contracts enforceable under U.S. law and affecting interstate commerce. A small press in Luxembourg only has to worry about the Supreme Law of the Grand Duchy.
The main problem with having ‘your own fans’ is when you take forever to write books. So they have something to buy from you every 5-10 years, the exact opposite of the reason most writers want those captive readers.
For those of us who have no other choice, due to illness in my case, but also those like Donna Tartt, who either have other jobs, or, as she is quoted saying, who don’t enjoy writing fast, unless we are in a community with other writers who use, say, the same village for all their mysteries, or who write similar Romance novels and take turns producing them so as to keep readers well supplied, we can’t keep ourselves supplied with new readers, and the ‘own list’ model doesn’t work.
The question for us becomes, “Can we make the one-story author model, or the occasional novel model, pay enough to be worth the effort?” Which in turn depends on selling a very large number of copies of those books.
I’m assuming you can, if it’s good enough AND your marketing keeps supplying NEW readers. But it’s a much rarer path to success. Going viral, or enchanting one of the big-name book clubs, or a movie deal is de rigueur. Because you’re always competing with every other source of reading/listening material out there, and need to stand out.
Even if the goal is legacy, not sales or popularity, you still have to be well-enough known to get the process started.