Notes from the Subsidiary Rights Program

María Jesús Aguiló, a native of Spain, moved to California in 1993 after completing a professional publishing course at the University of Barcelona and an internship with Antonia Kerrigan Literary Agency. In 1996 she joined Berrett-Koehler Publishers, where she is in charge of their international sales and subsidiary rights program. She attends several international book fairs a year, including Frankfurt, London, Guadalajara, and Beijing, and over the years has negotiated and signed over 1,000 subsidiary rights contracts.

Acknowledging that attendees all came from different types of companies, Aguiló explained that she would begin her presentation with a general introduction to subsidiary rights and conclude with a more in-depth question-and-answer session. She also mentioned that she would talk about digital rights, which until recently, were considered a sub-category of subsidiary rights (now, they are being considered primary rights).

Aguiló explained that subsidiary rights currently pertain to translation, audio, and film. In Berrett-Kohler’s case, translation represents the bulk of their subsidiary rights contracts. Since the company’s founding in 1992, Berrett-Kohler has signed over 1,400 translation rights contracts, despite the fact that it only produces 40 books per year. This means that each book is translated into an average of 5-6 languages. To date, Berrett-Kohler titles have been translated into more than 40 languages. Berrett-Kohler’s subsidiary rights revenue comes primarily from translations, a sum that amounts to 8-10% of the company’s overall revenue. Translations, therefore, can contribute significantly to a publisher’s income.

Aguiló emphasized the importance of being both consistent and aggressive with subsidiary rights contracts. Berrett-Kohler has a successful record with translations because the company has prioritized an international presence since its creation. They began by attending the Frankfurt bookfair, and then collaborated with a New York agent who offered to represent their books overseas. When Aguiló joined the company in 1996, this was the structure she inherited and then built on. One of the most important ways to build this model, she explained, was to be aggressive. Waiting for someone to find you will never work. She claimed that the best approach is to “get in the face” of the international publishers.

Berrett-Kohler also aims to acquire more contracts than more royalties: it is a better investment for them to sign five contracts for $2,000 each than one contract for $20,000, because it increases the chance that a book will break out in a particular market. She cautioned that in order to adopt this strategy, the list must be one that can “travel,” or in other words, appeal to a wide range of international audiences. Aguiló reminded the audience that in the case of bookfairs, it is essential to prepare in advance. She recommended starting preparations several months (up to six) ahead of time to make contact with people, send out catalogs, and schedule meetings. It is very difficult to set up meetings once a bookfair already begins.

Noting that the current economic climate has made attending bookfairs less feasible, Aguiló offered the audience some alternatives.

  • Scouts: hired by publishers overseas, scouts are not agents because they don’t work on commission, rather on retainer. Scouts check out the books at overseas fairs to determine which ones have promise. They tend to target bigger publishers in Europe and Asia. Overseas publishers are excited to hear about books coming out in the United States. Aguiló recommended making the investment to post new acquisitions in publishers marketplace or rights marketplace, because scouts will rely on this for information.
  • Newsletters: Berrett-Kohler sends out a bi-monthly newsletter to their rights contacts only (approximately 700 foreign publishers) announcing 3-4 titles. They make the manuscript available via download in order to avoid the expense of shipping books overseas (when they do ship, they save money with an international consolidator). They are still testing the efficacy of sending PDFs, because most publishers still prefer tangible products. However, Aguiló emphasized that publishers MUST know about your list because otherwise you won’t be on their radar. They are looking to fill spots, just like you.

Aguiló then moved on to the topic of audio rights, an area that has changed tremendously with the growth of digital technology. Previously, a book was licensed to an audio producer, the publisher was paid an advance, and then the producer created and distributed a cassette or CD. Audio publishers used to be more starved for shelf-space than book publishers, so they were highly selective, only choosing titles that had high print runs (more than 50,000) and audio files released at the same time as the actual book. This model was challenging for small publishers like Berrett-Kohler. Now, with digital downloads on the rise, more and more audio publishers are realizing that they don’t need to rely on the same kind of inventory. If a download is successful, then they can release a CD. Companies such as Audible.com are buying a lot of content from publishers. This will increase even more as downloading files directly to an iPod becomes more common.

Digital rights used to be seen as part of subsidiary rights, but are now considered primary rights. Aguiló reminded the audience that e-books are still the property of the publisher, much like a paperback version of a hardcover edition. She recommended never signing a contract for exclusive electronic distribution. When digital content is licensed to another entity, subsidiary rights are required, and still subject to the same royalty payments. Aguiló encouraged the audience to see the Kindle as an important opportunity. She noted that for books already sold on Amazon with “search inside the book” features, text can easily be converted to the Kindle, and thereby available to more readers. She also revealed that the Kindle now has an iPhone application, which they are not publicizing because they only get paid for the content, not the device. A question-and-answer session followed Aguiló’s presentation.

Q. What are the pros and cons of working with a sub-agent on an exclusive basis?

Aguiló explained that the advantage to this kind of arrangement is not managing several agents at once, but she acknowledged that it can risky to “put all the eggs in one basket.” It is also hard to terminate an ineffective partnership. But it is important to clarify terms with an agent to make sure that the work gets done. She recommended starting out on a non-exclusive basis whenever possible. In some countries—Korea, for example—agents are very collegial with each other and aren’t that competitive.

Q. How do you gauge the quality of a translation?

Aguiló noted that working with a high-quality publisher can help guarantee a high-quality translation. She recommended checking a publisher’s references beforehand. She reminded the audience that since it is in the publisher’s interest to sell a lot of titles, it behooves them to publish a quality translation. Sometimes, it can help to work with a team of experts who review the translation, or even identify a specific translator to work with. This procedure can be outlined in a contract. However, if you don’t have contacts in the country, and nobody on staff who speaks the language, you have to operate on trust.

Q. Has interest in U.S. titles declined in European markets?

Aguiló acknowledged that interest in U.S. titles had indeed declined. However, she expressed hope that with the recent restoration of the U.S.’s image abroad, the situation might improve. She noted that when U.S. sales declined, the European industry began imitating its practices and producing books in a similar fashion, which has led to significant shifts in the region’s publishing markets. Local authors have become more profitable, which benefits local publishers financially because they don’t have to pay for translations.

Q. Given the increase in sales of PDFs, what are the potential copyright/piracy risks?

It’s not a huge investment to convert a book into a universal PDF—it only costs $75. Yet, PDFs are still very easily copied. However, Berrett-Kohler has decided not to handle DRM, opting instead for a system that sweeps the Internet once a month to catch significant piracy efforts. They then send a cease-and-desist letter. This is similar to the situation with books being photocopied for college courses: it is impossible to regulate and enforce.

Q. How do you find the best scouts for European publishers?

 Aguiló responded that the best way is to find scouts is on the Internet. She also offered to provide a list of her contacts to anyone interested. She reminded the audience to pay close attention to a scout’s client list when making a selection. She also explained that scouts are only allowed to represent one client per country; otherwise it is a conflict of interest.

Q. Can you speak a little about video rights?

Several of Berrett-Kohler’s books have been converted to training videos. In the past, they made royalties off the sale of every VHS tape. Now, with the increase in webcasts and online videos, this model is less lucrative. Feature-length films can also be a good source of revenue.

Q. In what format do you send electronic manuscripts to make sure they’re not pirated?

Aguiló explained that when she distributes an electronic manuscript, she sends a link to a secure FTP server, where the file can be downloaded. After that, the only thing she can do is trust that it won’t be pirated. It is an honor system.

Q. What kind of software do you use to cull the Internet for major piracy issues?

Aguiló responded that unfortunately, she is not very familiar with this type of software. This is handled by the digital team at Berrett-Kohler.

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