Hydra (not to be confused with Hydra Publications), Alibi, Flirt, and Loveswept are new ebook only imprints developed by Random House that target aspiring, first time, or unagented authors. It is the first attempts for the Big 5 to come to grips with the changing publishing industry we have today totally on their own. However, they are still off the mark in so many ways it’s outright scary to be completely honest.

The first round’s offerings were: no advance to anyone, contract for the length of the copyright, 50/50 split with expenses covered at the backend and shifted to the author (so the author is really getting ~25% which is the traditional standard), and acquisition of subsidiary rights (film, international rights, TV, audio, etc). Print (if a print deal is reached) and marketing expenses are shifted to the author.

Alibi (mysteries/thrillers), Loveswept (romance), and Flirt (For the emerging New Adult market, but not the same as Young Adult) are the sisters of Hydra with similar contract terms for the stated genres.

Hydra, the fantasy/sci-fi division, was the first one that saw the light of day only to be blasted to oblivion by agents, authors, and writers groups–a good thing. Here are a few articles about the Round #1:

Scalzi: Advances and Me

Scalzi: SFWA (Science Fiction Writers Association) Responds to to Random House

SFWA Letter to Random House

Also check Google and Writer’s Beware can point you to others.

After the the authors, writer’s groups, and agents harnessed the power of the Internet and group efforts to raise their torches and pitchforks and storm the castle, Random House did listen and altered the contract a little. Here are some articles about what did change (not everything did). Also, Random House found themselves under the microscope after this epic fail. So Round #2:

Teleread.com: Backlists, Hydra, and the Future of Indie Publishing

Teleread.com: Random House’s Hydra Changes Contract Terms (see article for other embedded links to additional material)

At Random.com: A Special Message

After the heat finally subsided, Random House did listen–kudos for at least doing that–and did give the author a choice between and advance against royalties at up to $10K (you’re not guaranteed that much) and the going royalty rate of 25% of the net (not retail price) where the publisher may pay for marketing, etc, or the original schema (which sucks altogether IMHO).

It’s a little bit better; HOWEVER, there are still a lot of things wrong with the contract in my honest opinion that did not come out in the wash. These are things that an author needs to consider or be made aware of, if they should decide to publish here at any of these publishers:

• the life of the contract is STILL the length of the copyright UNLESS (next point)
• rights revert back to the author if she/he fails to sell 300 copies in the first 12 months, and the book goes out of print (out of print clause) Possible blacklisting?
• Expenses for print editions are still shifted to author (if print deals are met)
• Marketing expenses after some agreed upon amount are shifted to author and deducted from the royalty split
• Publisher still may try to purchase subsidiary rights, if they see potential for those markets (doesn’t guarantee you will have a TV, film, etc contract). The parent company, Random House, has these connections, but things are still iffy here.

So, if the author works his or her butt off to sell those 300 copies, then the publisher will own all the rights they purchased or THE AUTHOR GAVE AWAY FOR FREE (if they opted for no advance) for the length of the copyright. For anyone who doesn’t know how long that is, the copyright is the rest of the author’s life + 70 years. It’s not your standard traditional contract for 5 to 10 years! This is the forever of the publishing world–basically two lifetimes to put it into yet another perspective if you will–if you live to 75 or to 115 that’s still + 70 years :O.

This may be okay for some folks. If they know that going into the contract and are in of peace of mind with it, then that’s okay. It’s FUBAR for someone who doesn’t know and wouldn’t want that for themselves and sign the contract. Read and UNDERSTAND (purposeful emphasis, do more than just read!) your contract before signing. Also keep in mind, if you hate your cover, or if something goes south, or the publisher goes out of business (never brought up in the debate, mind you–is RH immortal/too-big-to-fail like BOA or Freddie Mac?), then they have the rights to your work forever (two lifetimes!) in which you could never republish at another publisher or self publish. Something to keep in mind.

Per some of the things I learned from reading blogs, the above articles, and Mark Levine’s The Fine Print of Self Publishing (some of the principles he teaches in his book can be applied to ANY publishing contract, especially since the emergence of hybrid publishers) I can draw some conclusions:

• Avoid publishers whose contracts’ terms last for the length of the copyright
• Do not sell you subsidiary rights if the publisher has no programs, connections, or plans to procure deals with those rights
• offer no advance to ALL authors (especially since this is usually the only money made in a traditional publishing deal unless you become a blockbuster bestseller, which is highly unlikely unless you’re lucky, or receive advances for subsidiary rights)
• Avoid any publisher who tries to get/buy “all rights” (which means all levels of print and subsidiary rights which kills or limits your negotiating power or ability to sell those rights elsewhere)
• Avoid any fuzzy math regarding the “net” profit. Typically the net is typically derived from in it’s simplest form is: X= retail price – seller discount – print cost – freight (print and freight omitted for ebook/freight may be paid by purchaser in some cases). Other figures may be addressed in the contract, so use it for a referral, and the publisher should supply a breakdown with real figures. When you don’t understand X, and where they mathematically derive X from the retail price, then the publisher can make X whatever it wants it to be and shave off money that may actually be yours and pocket it! Also learning what standard printing costs are is another big one per Mark Levine. This stuff has been done many times over! Mark Levine’s book covers a number of self publishing companies who have done this and there are more in traditional publishing as well that aren’t in a book. Welcome to shark infested waters, my friends! I learned this hard lesson the hard way already, and I have the battle scar to prove it.
• Ask the publisher (if traditional) extensive questions about their marketing plans for your book and get it in black and white and understand what their and your responsibilities are. If you are completely responsible for marketing, and you are negotiating with a traditional publisher, and they won’t budge, then you are better off self publishing or finding another publisher–there is a danger of going out of print early or getting blacklisted if you fail to meet the sale requirements at the deadline (selling books is not easy! avoid the “Field of Dreams” mindset)–the author is really the one taking all the risk here, not the publisher. You still should help market regardless of publishing model, but the publisher is likely to help you if they invest money, but if not, you have a big decision to make. You are held responsible for the failure and not the publisher regardless, and whatever happens, the publisher keeps the rights until the term ends, and you can’t do anything until you get your rights back. Keep in mind,traditional publishing deadlines to meet X books are short! Be prepared, do your homework.

What also baffles me is that this is an ebook publisher. They are still taking a huge chunk of 50+% out of every book sold when there there is no printing or freight costs. After an ebook is formatted and a digital cover, and in some cases illustrations, is/are created, there is no cost to download or reproduce a copy. The author is not paying for printing or freight costs–nobody is. That is why ebooks cost less than print books (or they should!) and are favorable giveaway items for self published authors. That should make you ask yourself if this is worth it. What could the publisher be making in profits from a successful author?! It also should make you ask why they are taking such a huge bite out of the royalty! Even if they are helping with marketing, ebooks minimize the overhead costs for EVERYONE! This doesn’t make sense whatsoever. It doesn’t cost that much to help promote or distribute an ebook, so again, why are they taking 50+%? This might be OK for a traditional print contract, but not for an ebook.

In summary, this publisher still flunks my quiz even after the changes. Mark would label it as a “Publisher to Avoid”. This is a hybrid publisher to stay away from regardless that Author Solutions isn’t involved, but maybe Random House has had pointers taken from Author Solutions by the looks of things.  If that is so, they are getting the wrong advice. I know some people they should talk to for better advice. I would never submit here, and I wouldn’t publish here if they offered me a contract for the max amount. They would have to do a lot better than that, and I have found other small presses and self publishing companies who provide better options. There are more fish in the sea, and gone are the days when authors had to settle for second best or crappy-at-best just to enter into print–and nowadays digital!