SFWA^® Statement
on Electronic Rights

Publishing is now going through enormous technological changes. New information markets and formats, such as electronic distribution, Web-based publishing, and multimedia products, are creating a new type of marketplace without a physical location and products without a physical embodiment. The "American publishing industry" is now part of a global information and entertainment phenomenon that includes computers, consumer electronics, communications, publishing, education, and entertainment.

In this new technological era, ownership of content is key. For those who own content, the "global infosphere," as the National Writers' Union calls it, affords new possibilities for publishing, promotion, and distribution.

One consequence of this electronic era has been a rush to acquire content. Publishers and magazines have asked for electronic rights, sometimes for a small fixed price, sometimes for free.

The electronic era raises several issues for SF writers. The most immediately important in economic terms are those of our rights to our own material.

The optimal position for authors is to retain all electronic rights, for both distribution and adaptation, until s/he gets a clear, specific, and believable offer of publication, for which s/he is getting a fair royalty. Only if writers retain their full electronic rights can they protect their creative investment and retain the ability to control its future use (including many forms of noncommercial use).

 
Terminology

It's important to distinguish between electronic distribution (on disks, on the Internet or the Web) and electronic adaptation (sometimes called hypermedia or multimedia).

In electronic distribution, the unchanged text of the book or an image of its unchanged pages is stored and distributed electronically. In many ways electronic distribution resembles traditional publishing, but with radically lowered printing and storage costs and minimal penalties for keeping the book in print. To some degree, authors can do this form of publishing themselves; some have begun to do so, selling their own "out of print" texts over the Web. Publishers can do the same thing, making their backlist potentially more valuable.

Hypermedia/multimedia is a new medium, a creation of software rather than text alone. The relationships between pieces of text are no longer the same relationships as those between pages or chapters of a book. Pieces of text are linked. The essential structure of a hypermedia adaptation is a structure of links, which (particularly in the case of fiction) modifies or supplants the previous linear structure of the work.

In addition, electronic adaptations may add visuals (animation, video, still pictures) and/or programming, and may repurpose the work, republish it in a different context and sometimes in adapted form.

Creating an electronic version of a book can be as simple as adding links or, because of multimedia additions and programming, it can become extremely complex and costly.

It is unlikely that a contract written today can determine what rights can be economically exploited in the future, how valuable those rights will be, or what company will be in the best position to exploit them. Writers should protect their equity in their creative work by retaining these rights, as they retain movie rights, until they can sell them in the expectation of a profit.

Electronic distribution

Publishers have argued that they must retain electronic distribution rights to protect their investment in publicizing the book. Without those rights, they argue, the sales of their own print versions of the work may be adversely affected by competing electronic versions. It is clearly in everyone's interest that (at least for a substantial period of time) one edition does not cannibalize another. In the future, with anticipated electronic distribution of backlist, this may become an important issue for books. It has already become one for shorter works.

If writers choose to sell electronic distribution rights, it should be clear that electronic distribution alone is being covered: that is, the distribution in electronic form of an unchanged image. Electronic distribution as such does not cover works that are "abridged," "expanded," "adapted," or modified in any way. It does not cover the addition of links to the work, or the repurposing of a work for a different context. The first is an adaptation; the second, an anthology republication.

Electronic adaptations

The issue of cannibalization applies only to electronic distribution. Market experience so far has shown that adaptations of a novel or story into different media create interest rather than dividing it; the game promotes the novel and vice versa, as the movie promotes the novel.

The electronic adaptation of a work into hypermedia or multimedia is an adaptation into a different medium, and should be governed by the same model as, for example, movie rights. (However, in contrast to the case with movie adaptations, there can legitimately be more than one electronic adaptation of the same work. For instance, there may be Dune the computer game, Dune the interactive CD-ROM edition of the movie, which also contains the text of the book, and Dune the repurposed and linked element of Herbert's complete works on CD-ROM.)

SF/F writers should be very careful to specify what rights they sell when selling electronic rights. With the convergence of consumer electronics, games, and movies, it will become less easy to create a clear contractual distinction between deluxe book editions, hypermedia/multimedia adaptations, movie adaptations, and games.

In no case, when electronic adaptation rights are sold, should writers give the right to the electronic publisher to make "adaptations" or "further works" with the same world or characters, as this can be construed to be a general licensing of rights.

Considerations in selling electronic distribution and adaptation rights

Writers may choose to sell some or all of their electronic distribution rights and adaptation rights to the same house that publishes their books. However, different sorts of electronic works varies widely in cost, complexity, and ease of creation. Not every house is set up to exploit every distribution channel or every sort of adaptation, nor should they be.

If writers choose to sell electronic distribution rights, they should be aware of the following issues:

• Some publishers are now asking for rights of "publication and adaptation" for "all media now known or hereafter to be discovered" (or, in Jeff Hecht's wonderful phrase, "all media involving electrons"). This formulation unacceptably mixes distribution and adaptation rights and cuts into other rights, including film and audiotape.
  
  Electronic rights should remain divisible by medium, format, and content.
  
  The cost for the whole bucket of rights should reflect the cost of the component rights, including film adaptation and general licensing of characters. When pressed, most publishers do not really want all rights.
  
  
• Though the contract may not say so, some publishers have taken the stand that a work in print in one medium (e.g. electronic) is to be considered in print in all media (including paper).
  
  Being in print in one medium does not imply being in print in another. Paper rights may revert while electronic rights are active; some electronic rights may revert while others are active.
  
  The definition of "out of print" in any form of publication should specify what criteria are being used. Criteria may include availability of stock, listing in a catalog, availability through specified outlets or at a specified site, degree of publicity, etc.
• Particularly for short works, some publishers are now offering a flat fee (or no fee at all) for electronic reprinting and repurposing.
  
  The purchase of one-time North American print rights does not imply bulk purchase of any distribution rights. Still less does it imply any right of adaptation or repurpose. A work that is purchased with unlimited rights of distribution and adaptive reuse is a work-for-hire or a general licensing of rights, and should be compensated as such.
  
  Fair compensation for electronic reprints should be an advance against per-use or per-sale royalties. Proper safeguards should be built into the distribution mechanism so that these figures can be collected and royalties can be paid to the author. The Authors' Registry provides a mechanism to do so.
  
  This committee urges that SFWA support the Authors' Registry and other mechanisms, but develop "random audit" procedures to test their effectiveness.
  
  
• Some publishers have attempted to negotiate a single royalty percentage for all forms of electronic publication.
  
  Electronic royalties should vary by medium, format, and content.
  
  In the case of electronic distribution, the royalty split should be negotiated during the publication process, reflecting the specific content, medium, and format.
  
  In electronic adaptations, the royalty split should reflect the efforts of the various participants.
  Distributors' costs for producing, distributing, storing, and even publicizing electronic books are likely to be low; therefore, an author may well expect a significantly higher royalty rate than with the corresponding paper version. (Some sources have suggested as high as 85-90%.) But the costs of electronic adaptation can be high, and the author may receive a much lower percentage.
  
  Contracts should set some time limits on electronic rights.
  
  Electronic rights should be negotiated per-medium and on an option basis. If they are not exercised within a stated period, rights for that medium should revert to the author.
  
  Given the rapid development of technology, it may be appropriate that electronic publication rights be renegotiated after a certain time period.
  
  
• Unless the writer has given permission, his/her words should not be augmented, condensed, or excerpted in any publication, electronic or otherwise, beyond the limits of fair use.
• Some magazines have attempted to gain broad electronic rights by printing additions to the magazine contract on the back of the check. Such additions should be crossed out; the contract has already been negotiated.

The current difficulties in negotiating electronic rights come largely from genuine ignorance about the value of these rights. The publishers do not want to let rights get away that will be necessary to their future financial health. Neither do we.

Most publishers are responding reasonably to reasonable stands on retaining electronic rights. The process sometimes takes time As both sides gain experience, and as the market develops, it will be easier to negotiate a fair grant of rights.

In the meantime, we can protect our equity in our creative work by retaining electronic rights, as we retain movie rights, until we can sell them profitably.

Other "Electronic" Issues That Concern SF Writers

Writers are not the only ones who can potentially benefit from new technology, or be seriously affected by it. Writers, fans, small publishers, APAzines, newsletters, and our readers all stand to gain or to lose from decisions that are being taken now.

As a committee, we advocate the following stands and urge SFWA and its members to consider them:

We advocate that the new electronic infostructure be priced within the reach of the ordinary consumer, and that libraries, schools, and other public institutions be provided with access points. It is important not to divide the world into those who have the right to read information and those who don't.

The technology exists to enable individual authors, small presses, and writer co-ops to publish and distribute on the network, and to have their payments and royalties electronically collected. Small publishers and self-publishers should not be priced out of this market. We advocate that the price of technology, distribution, and royalty collection must remain within the reach of small publishers.

The Authors' Registry is an important step toward parity in this area. We commend SFWA for its support of the Registry and urge all SFWA authors to register.

Unauthorized duplication steals from all authors and publishers. We advocate:

• The development of easy, legal ways to use electronically stored information while paying for it.
• The development and use of methods to track copies of works, including authentication checksums and embedding of electronic signatures.
• The rewriting of US law to give US authors equal protection with signatories of the Bern Convention on copyright law.
• US governmental cooperation against piracy, including actions and sanctions against pirates.

The libraries of the future are likely to be repositories of electronically distributed documents as well as books. They are already taking advantage of electronic distribution. N libraries, each of which once bought one copy of a hardback book, are becoming one library consortium loaning out smaller numbers of copies and keeping track of them electronically. In the future, libraries will presumably develop some sort of loan scheme for electronic documents.

We support public libraries, but urge them to be aware that, in their role as information resource, they may compete with other electronic means of distribution.

As publishers move toward electronic publication, issues of preservation become urgent. Times change, operating systems change, and some fairly important works, e.g. Thomas Disch's Amnesia, are now on the verge of being lost for technical reasons. We urge publishers, distributors, and authors, to be aware of the preservation issues involved in electronic distribution and adaptation, and we ask them to take all appropriate steps, including retaining uncompiled masters of electronic works and adaptations.

Please add to this list!

• "Statement of the Authors League of America before the Working Group on Intellectual Property Rights of the White House Information Infrastructure Task Force, September 23, 1994." Available from the Authors Guild (see below) or the Authors League of America, 330 W. 42nd St., New York NY 10036; 212-564-8350
• "Electronic Publishing Rights. A position statement by the Authors Guild and the American Society of Journalists and Authors (ASJA), October 18, 1993." Available from the Authors Guild, 330 W. 42nd St., New York NY 10036-6902 212-563-5904, staff@authorsguild.org
• "Statements of Principles on Contracts Between Writers and Electronic Book Publishers, National Writers Union, April 1994" and "Recommended Principles for Contracts Covering Online Book Publishing, National Writers Union, September 1994." Both are available from NWU.
• ASJA Contracts Watch electronic newsletter gives the latest in rights issues for producers of short works. To receive each edition of ASJA Contracts Watch automatically by e-mail, send e-mail to: MAJORDOMO@ESKIMO.COM. Put nothing in the subject line; in the message area, type: SUBSCRIBE ASJACW-L
• An excellent site with many electronic rights links is WWW Multimedia Law, maintained by Sandy Wong and a California multimedia law firm: http://www.batnet.com/oikoumene/. WWW Multimedia can also be reached at http://www.oikoumene.com/
• From this board you can reach, among other articles: "Copyright in the New World of Electronic Publishing," by William D. Strong, 1994. Strong discusses legal issues in electronic publishing from the publishers' point of view. An excellent summary.
• The Screenwriters' Guild runs a good board on multimedia issues, including law, and will take questions: http://www.screenwriters.com/Law/
• The index page of the House of Representatives' Internet Law Library, section on Intellectual Property, has a number of key legal documents, including the Berne Convention and the US Copyright Law: formerly at http://www.pls.com:8001/his/105.htm, now at http://www.priweb.com/internetlawlib/105.htm

I will post more sources as I get them on my Web electronic rights page: http://world.std.com/~swrs/library/elecrght.htm

— Sarah Smith