Built on open-source software, the registry will be searchable via web user interface, and will provide a web API for organizations that want to integrate the information into their databases. Members of EIDR will have open access to the registry, and be able to submit their content to the registry for identification.

In addressing the implications for the television and film industries, the industry press release announces that “EIDR has been developed to address a critical need for a universal ID system for all types of audio/video assets in the entertainment industry, making it easier for businesses to search, track rights and report revenue based on an assets’ unique ID. The expected results are increased accuracy of information flowing to consumers, and lower cost and more efficient back-office processes.”

From a publishing and rights management perspective, the most interesting implications are those for cross-pollination between content formats.

Publishers are increasingly creating cross media products, in addition to all the supplemental materials — like video and audio files — related to books, and the EIDR could represent a chance for publishers to distribute this content to more users, more efficiently.

The film and television industries have huge distribution pipelines, and audiences, in place. By using the EIDR to classify content like podcasts, author interviews, book trailers, supplemental content, and possibly audiobooks, publishers may be able to tap into those distribution channels.

It’s almost a given that new distribution channels will be created to draw from this database. The EIDR does not provide any rights management support though – it simply assigns metadata to content, irrespective of ownership – so the industry should be prepared for new licensing and rights management challenges.

According to a provision in the Dodd-Frank financial reform law, the Securities and Exchange Commission will issue regulations requiring energy and mining companies to annually disclose royalties, license fees, production entitlements, bonuses, taxes and other payments linked to commercial development. Companies must identify the business unit that made the payments, the government that received the payments, and the specific project, according to the law.

“The new U.S. law will greatly increase the volume and detail that is available about the payment stream because it will cover payments to governments in all countries where the affected companies operate,” says Karin Lissakers, director of Revenue Watch Institute, the developers of the new index. “It also requires project-by-project reporting, so there will be a significant increase in the overall disclosure of these payment streams, which will tell us a lot about what the countries are receiving.”

To create the new ranking, Revenue Watch and Transparency International compiled public statements and disclosures by 41 governments about the money received for oil, gas, and minerals production. Transparency is crucial, they argue, to prevent government corruption and encourage accountability in how energy and mining revenue is used to promote economic development.

Brazil ranked No. 1 in government openness about energy management, followed by Norway, Russia, Mexico, Chile, Colombia, Kazakhstan, Peru, Azerbaijan, and Ecuador, according to the index. The United States was No. 10; at or near the bottom of the index were some resource heavyweights including Turkmenistan, Equatorial Guinea, Kuwait, Ghana, and Saudi Arabia.

The new SEC regulations should be in place for all publicly traded companies by 2012.  By law, the SEC must finalize the regulations by next July, but it faces considerable opposition from the energy industry.  The energy industry has long resisted regulatory scrutiny, but is set to experience a new level of attention, in particular to recurring payments such as licensing and royalties.

A major way for energy companies to ensure workflow continuity, and to ease the strain of heightened regulatory compliance, is to automate key accounting functions.  Chief among these are energy licensing contracts and energy royalty accounting.  As stricter environmental regulations have forced energy producers to incorporate technological upgrades, so too will the increase in transparency and regulatory standards.  The newest tool for energy producers in light of coming SEC requirements are likely going royalty software and rights management software systems.

Google Editions, the much-delayed online e-book store store which the search giant has been trying to launch, will offer universal access and non-restrictive copying of e-books.  Purchases made at the Google bookstore will be stored online, and linked to the customer’s Google account, and they can then be read online, or downloaded to a cache for offline reading.

At the conference, Harvard University Press sales director turned Google strategist Chris Palma said “the role of publishers and booksellers as gatekeepers is going to become stronger. People are going to realize that free is not best.”

Palma described Google’s role as a wholesaler, like Ingram or Baker & Taylor.  Under the agency model, Google will act as an agent on behalf of the publisher, and prices will be fixed across the board.

The fact that Google will also be selling directly on its site caused some booksellers concern. As one commented, “it’s kind of like the fox watching the henhouse.” Palma praised booksellers’ ability to curate, adding that cince Google excels at selling ads – $26 billion worth – it has not needed to sell e-books.  Kenny Brechner, owner of Devaney Doak and Garrett Booksellers in Farmington, Maine, was not convinced: “You’re not good at bookselling yet. Over time you’ll be creating a curatorial model.”

ABA COO Len Vlahos acknowledged that the partnership with Google has some drawbacks. “ABA would be foolish, if we didn’t come into this with skepticism, too,” he said. “But Google’s DNA is wired to help people search. We don’t know who the other partners are. They could be Barnes & Noble or Wal-Mart. The alternative is we won’t be in the conversation. Truthfully these people came to us. We feel it’s absolutely imperative that we be there.”

Whatever role Google plays as an agency, a wholesaler, or in the DTP fray with B&N and Amazon, it’s poised to have profound impacts on royalty rates, royalty calculations, and royalty payments.  Whether publishers and retailers work with the search giant, or try to resist it’s reach into the book market, everyone is going to have to play by a few rules from Google’s playbook – whatever that ends up being.

The only way publishers can truly prepare for Google’s entry into e-books, is to make sure their own houses are in order.  Being ready to play with Google requires the ability to plug into markets and manage data streams that are very, very deep.  A smart first step is incorporating software help, such as systems to automate contract management, or royalties management.   Royalty management and complex rights agreements are set to become make-or-break arenas of competition, and accurate, efficient rights and royalties management is only going to become a more critical ingredient for success.

Despite the prevalence of non-compete clauses in author contracts, many authors are venturing into e-book or multimedia agreements, risking lawsuits from their print publishers.

The benchmark 2001 case of Random House v. Rosetta Books set a precedent, when the New York Federal Court refused to grant Random House a preliminary injunction against Rosetta, an e-book publisher that was trying to publish electronic versions of Random backlist titles like Styron’s Sophie’s Choice and Vonnegut’s Breakfast of Champions.

And despite non-compete clauses in many author contracts, Sara Pearl, VP and Director of Business Affairs at Trident Media Group, said courts tend to favor the authors. “The courts don’t like to cut off how someone makes their living,” she said.

Of the Random House case, U.S. District Judge Sidney H. Stein says, “In [Random House’s] case, the ‘new use’ – electronic digital signals sent over the internet – is a separate medium from the original use – printed words on paper.” The court pointed out that Random House included separate language in its contracts for other forms of printed books such as large print, book club editions, and Braille editions, indicating that Random House did not believe that its contracts automatically granted the company the rights to all possible forms of its books.

Random House countered in December, when CEO Markus Dohle sent a letter to agents asserting that it holds e-book rights to all of its titles. Dohle called the 2001 judgment and other challenges to its claims “misunderstandings,” and pointed to Random House’s noncompetition clause as further proof that authors are prevented from “granting publishing rights to third parties that would compromise the rights for which Random House has bargained.”

Judge Stein made quite clear the limitations on the scope of the court’s ruling. The judgment was merely a “neutral” interpretation of contract law in Random House’s case, he noted in the decision.

“This is neither a victory for technophiles nor a defeat for Luddites,” he wrote, leaving the door wide open for new interpretations of other publishers’ claims.

Speaking at the panel, John Silbersack, an Executive VP at Trident, admitted that Amazon’s practice of selling e-books and print books next to each other on its website may give publishers possible legal ground to stand on.

“We’re talking about developing products that are going side by side” with print, Silbersack said. “It’s a little hard to argue that you’re not in the same space.”

Backlist titles are an attractive option for agents, because newer contracts often include the sale of ebook rights. “When you get to the frontlist, you cannot sell a book without selling ebook rights,” Pearl said. “The hot new thing is multimedia rights.” The new mobile or iPhone content is only restricted to 20-25% verbatim from the author’s work – the rest is “bells and whistles,” she said.

Publishers are also eager to capitalize on backlist titles; Silbersack said that agents are encountering pushback when they try to obtain termination notices for out-of-print books, something that he said his agency is “aggressive” about.

An author’s sale of multimedia rights is a publicity tool, not yet a major revenue source:

“It’s more of a forward-looking thing, a marketing thing,” Silbersack said. “They can make use of these features to reach beyond the book reading world.”

Though multimedia deals might not constitute the largest portion of a book’s revenue, it’s obvious that both agents and publishers are anticipating an major shakeout over these new platforms and neither camp wants to compromise their stakes.

“I don’t think that anyone can argue . . . that this is a battle that needs to be fought right now from a monetary perspective,” Silbersack said. “However, it’s a battle that needs to be fought to discuss what the points of tension are. Trident is beginning to test these waters.”

Pearl agreed that despite the hassle and the possible legal ramifications for authors selling multimedia rights, the panelists were enthusiastic about pursuing multimedia deals.

“I think you can’t fight it,” Pearl said. “Most of this is found money. Authors can control how the content is used, and they make a little bit of money. Right now, nobody’s doing anything with [the rights]. Net, it’s not a bad thing.”

The panel discussion also touched on Macmillan and Amazon’s agency model vs. trade model tug-of-war, and the much-debated questions over fair use that Google Books is currently mired in. In news from the OnCopyright Conference, also held last month in New York, Google’s Senior Copyright Counsel Bill Patry said the best approach to managing rights issues concerning the Internet was self-policing through privately sourced licensing agreements. Patry cited as an example the CHORUSS music copyright licensing service, which allows schools to pay a set licensing fee for unlimited use of a music catalogue within the schools. He recommended that trade groups stop lobbying so fervently for copyright as an “economic right” and instead seek actuarial solutions from the Copyright Clearance Center or ASCAP.

The panel featured four panelists: Neil de Young, Executive Director, Hachette Digital; Paul Aiken, Executive Director, Authors Guild; Lloyd Jassin, attorney; and Scott Waxman, Waxman Literary Agency.  Discussion focused mainly on the financial issues related to e-book rights, with a clear divide emerging between traditional publishing (Mr. de Young, and most of the audience members) and the other panelists, who mostly represented the authors.

All the panelists agreed that electronic books will ultimately increase readership and increase overall sales. According to Mr. de Young , sales data shows that the advent of e-books means consumers are reading more , while other panelists pointed out the prevalence of digital reading devices – in fact, two attendees in the front row were using iPad.  The general consensus was that  e-books present an opportunity to make a significant amount of money.

Mr. de Young, who for most of the discussion served as the de facto representative of traditional publishing, explained that the reduction in print costs for digital books does not make up for the additional costs of things like encryption, copyright protection, formatting, and online distribution. Since 90% of consumers still read print books, Mr. de Young said, there is now a demand for two warehouses, one physical, one digital, which also adds on costs to the publishing process, and ultimately necessitates a royalty rate similar to that of print editions.

From the other side, Mr. Aiken claimed that most of these digital costs were only one-time expenses (corroborated by Mr. Waxman), and that digital warehouses are much cheaper in the long run. He said that digital royalties could not remain at their current rate, and continued 25% royalties on e-books will cause authors to leave traditional publishers. Mr. Jassin thinks this issue will come to a head by 2013, when a new copyright law takes effect that will cause the contracts on many backlist titles to come up for renegotiation. He said that publishers have traditionally been unresponsive to the idea of new formats for books (citing a handwritten contract of Mark Twain’s that included a clause about new formats, with no mention of new royalties).  Mr. Waxman, however, expressed faith that traditional publishing houses were full of “enough smart people” that they would adapt.

While debate over royalties dominated the discussion, the panelists found unexpected common ground in the brick-and-mortar bookstore.  All four panelists agreed that the online shopping experience for books, whether e-books or print, was not as exciting or engaging for consumers as being inside a bookstore. Even the panelists who predicted a large digital shift would like to see bookstores stay in business, in order to maintain a physical, tangible presence for the book.

The takeaway is that keeping bookstores open – so that customers see books on shelves, and can browse them easily – is critical to the book industry’s health in the eyes of consumers.  At the same time, the internal battle over royalties, with competition between different platforms and retail sectors to provide the most attractive rates – is becoming an increasingly critical part of the behind-the-scenes book industry landscape.

As usual, a stronger reliance on royalty rates, royalty calculations, and royalty payments have in effect made royalty management the most mission-critical part of competition for any publisher.  It’s an area in which Excel spreadsheets and an overw0rked accountant no longer suffice.  One certainty is that all of the major players involved are using a dedicated royalty management software.

The similarities between the two publishing platforms extends to a royalty “sweet spot.” Amazon made waves by announcing last June that it would pay a 70% royalty rate on books priced between $2.99 and $9.99, and the Barnes and Noble plan has a similar incentive, offering a 65% royalty payment on books in the $2.99 to $9.99 range.

The Nook platform enjoys Barnes & Noble’s major market presence, plus its friendliness toward peer sharing and casual content browsing. It has a “Read in Store” feature, letting users browse an e-book in its entirety as long as the reader is physically in a Barnes and Noble store; and “LendMe” lets users loan their e-books out to friends for up to 14 days.

Self-publishing tools, offered by major retailers to independent and DIY publishers, is a sure way of broadening the content available in e-book stores. “The launch of our PubIt! platform further reinforces our long-standing commitment to authors and writers, and offers a significant opportunity to provide an even greater selection of reading material to our millions of customers,” Theresa Horner, director, digital products, Barnes & Noble said on Monday.

Of particular note to publishers should be the intersection of royalties and competing platforms; while market share battles drive down margins for retailers, royalty rates are emerging as a more prominent arena of competition. The ability to manage royalties – with all of the inherent royalty calculations, data management, and processing ability – is more than ever a necessity for staying competitive.

The Frankfurt Book Fair is hosting three days of events focusing on the future of the book in the digital age, beginning on October 6th.  Among other topics, the talks will include expert opinion on “E-rights and roles,” from Robert Gottlieb, Chairman of Trident Media Group, LLC.

A full list of speakers is below; stay tuned here for the recap after the Frankfurt fair closes.



Wednesday, October 6

10:30-11:00am
Digital Book World
Speaker: Mike Shatzkin, Founder & CEO, The Idea Logical Company
Chair: Mark Dressler

11:00-11:30am
How Innovation and the Digital World Resets the Playing Field for Publishers Large and Small
Speakers: Neal Hoskins and Marie-Adele Murray, Winged Chariot Press
Moderator: Mark Dressler

12:00-12:30pm
A Social Approach to Publishing
Speaker: Richard Nash, Founder, Cursor

1:00-2:00pm
The eBook Strategies of Major Publishers
Speakers: Brian Murray, CEO, HarperCollins
Evan Schnittman, Managing Director, Bloomsbury
Andrew Savikas, VP, O’Reilly Media
Host: Tom Turvey, Director, Google

2:30-3:00pm
App Development
Speakers: Dean Johnson, Creative Director, Brandwidth
Rhys Cazenove, Co-Founder, Enhanced Editions

3:30-4:00pm
E-Rights and Roles
Speaker: Robert Gottlieb, Chairman, Trident Media Group, LLC

Thursday, October 7

10:00-10:30am
Kobo – What’s Next?
Speaker: Michael Tamblyn, EVP Content, Sales & Merchandising, Kobo

11:00am-12:00pm
Australia/New Zealand publishing market overview
Speakers: Rod Martin (Era Publications), Patricia Genat (Adelaide Library Services), Peter Dowling (Oratio Media)
Hosted by Bookseller+Publisher magazine (www.booksellerandpublisher.com.au)
Moderated by Tim Coronel, publisher, Bookseller+Publisher

2:00-3:00pm
Starting the eBook Commerce in Brazil
Speakers: Frederico Indiani, Director of Purchasing at Livraria Saraiva
Hosted by PublishNews
Moderated by: Carlo Carrenho

4:00-4:30pm
Meet Richard Mollet – recently appointed Chief Executive of the UK Publishers’ Association
Speaker: Richard Mollet
Interviewer: Richard Charkin, Executive Director, Bloomsbury Publishing

4:30-5:30pm
Frankfurt Book Fair Tweet-Up
Meet, greet, and tweet! Drinks will be provided.

Friday, October 8

10:00am-11:00am
The Brazilian Digital Market
Speakers: Newton Neto (Director, Singular Digital)
Moderated by Carlo Carrenho, PublishNews
Hosted by PublishNews
Moderated by Carlo Carrenho

11:00-11:30am
Digital B2C Considerations
Speaker: Caroline Fortin, VP & Publisher, QA International

12:00pm-1:30pm
EPUB: Producing eBooks Using the Industry Standard
Speakers:
 James Macfarlane, President, Easypress Technologies (EasyEPUB)
Moderator: Michael Smith, International Digital Publishing Forum, Executive Director

3:00pm-3:30pm
Beyond the Hype: Digital Publishing at the Multimedia Coalface
Speaker: Michael Bhaskar, Head of Digital, Profile Books

The event will feature four panelists — Authors Guild executive director Paul Aiken, agent Scott Waxman, attorney Lloyd Jassin and Neil de Young, executive director of Hachette Digital, weighing in on e-book rights — who owns them, who should own them and how they can best be exploited.  The event is sponsored by the BISG, and you can register here.

Stay tuned for our recap after the discussion.

Of the Rosetta case, Lawrence writes:

“In denying Random House’s request for an injunction, the district court ascribed to this generally accepted definition of the word “book,” and found that the grant of e-book rights was not contemplated by contracts which preceded the invention of e-books themselves.

The court of appeal subsequently upheld the lower court’s decision, but noted in passing that “there is some appeal to Random House’s argument that an ‘ebook’ – a digital book that can be read on a computer screen or an electronic device . . . is simply a ‘form’ of a book, and therefore within the coverage of Random House’s licenses.”

And he concludes, unsurprisingly:

“the most important question — still remains unanswered:  Who owns the e-book rights to books published before the advent of e-books?

Right now the answer appears to be ‘Who knows?’”

On the other hand, subsidiary rights – those rights that are subsidiary to the right of publishing the literary work in book form – can constitute a valuable percentage of the revenue opportunity of a book.  Subrights can include electronic rights, motion picture and television rights, audio book rights, audiovisual rights, merchandising rights and dramatic or performance rights, plus foreign translation rights, serialization rights, book club rights, and the rights for special editions.

Indeed, considering the global scope and multiplicity of platforms, publishing houses often have personnel dedicated specifically to this area.  Managing subrights can require:

• Sending manuscripts, proposals, and books to foreign publishers and agents, audio houses, and paperback publishers
• Coordinating co-productions with other publishers and audio houses
• Working with book clubs and sales for special editions
• Maintaining relationships with other publishers
• Attending book fairs worldwide
• Managing subrights agreements
• Collection of Royalties

Many of these duties can be facilitated by a quality rights management system.  Still, given how much potential revenue is represented by products within the subrights realm, integrating subrights management into your overall royalty accounting system is critical to staying competitive and being prepared for growth.

Not every royalty accounting software system can effectively accommodate all of the idiosyncrasies of subright management.  Your own requirements for managing subrights within your overall royalty accounting structure will vary – some publishers will be focused on selling rights for foreign translations, while others may be focused strictly on merchandising tie-ins.

• Separation/Tracking of exclusive (e.g. rights) and non-exclusive (e.g. permission)

• Ability to manage rights by:

Country

Language

Type of Right

Frequency

• Ability to manage receipts of subright statements and royalty payments, and to:

Create dunning/chase letters

Create reports identifying past due and upcoming receipts

Track earnings against advances

Track taxes and commissions

• Ability to manage subright royalty payments to Authors

• Ability to store detailed contract info

• Accommodation of unlimited rights (Country, Type, etc)

• Accommodation of unlimited contract complexity, including:

Escalators (aka sliding scales)

Varying payout criteria for any type of right

-Flat Rate per Unit

-Percentage of Sales

• Protection against selling rights for which you don’t own the rights

Accounting System Integration

• Ability to transmit subright transactions and accruals to virtually any general ledger (GL) system
• Ability to generate key reports that tie to GL
• Ability to transmit payments to AP

Subright Statements

• Ability to customize statements to any level of detail

Royalty software that includes all of the above listed functions will be able to directly link all royalty accounting aspects of your subrights agreements to your royalty software, and automatically calculate payouts to royalty recipients based on the rules in the contract.  As stated earlier, a suite of subrights agreements can’t be managed by software alone, but by integrating the accounting functions of your subrights contracts, you can drastically boost efficiency and accuracy, thereby reducing costs.