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War over e-books heats up

If publishers were nervous about the future of the industry before, they’ve gotta be outright terrified now. Over the past few days, some of the most time-honoured practices of the business have been challenged or assaulted, and Amazon is leading the charge.

Late last week, the competition in the U.S. to offer the cheapest prices on e-books reached a new low with both Amazon and Barnes & Noble offering selected new titles for a mere $7.99. Though online retailers are absorbing the losses at the moment, there’s a strong possibility that the burden could shift to publishers. More important, however, is the fact that Amazon and its ilk have effectively shut publishers out of e-book pricing decisions altogether.

An equally pressing topic, meanwhile, is the question of who owns e-book rights to backlist titles. Since the vast majority of old author contracts contain no stipulations about e-book rights, authors and agents are awakening to the possibility of shopping those rights to firms other than the ones that publish the hard copies. Simon & Schuster found this out the hard way earlier this week when one of its authors, Stephen Covey, signed a deal with Amazon for exclusive digital rights to his perennial bestseller The 7 Habits of Highly Effective People. The move, which essentially cuts publishers out of the process altogether, is likely to catch on with a lot of other big-name authors if it goes unchallenged.

Clearly alarmed by what’s been happening, Random House took the ill-advised move of informing agents and authors that it retains exclusive digital rights to the vast majority of its backlist titles ā€œ a highly debatable assertion, and one that came off more like a threat than a friendly reminder.

According to a report in the Guardian today, however, Random House may not have a leg to stand on. The article points out that in 2002 Random House failed in an attempt to block e-book company RosettaBooks from selling digital versions of several of its backlist titles:

The ruling, upheld on appeal, found that copyright for books that were written before digital publishing existed remained with the author.

Arthur Klebanoff, head of RosettaBooks, secured Covey’s exclusive deal this week with Amazon. He said: “We are very clear about this, the author controls the rights unless it is specified otherwise, and that was settled by the courts years ago.”

Simon & Schuster, which took a knock over the Covey deal, was taking a softer stance than Random House but not accepting defeat. Adam Rothberg, a spokesman, would not comment on Covey specifically, but said in general terms it was the company’s “intention to publish the electronic editions to our backlist titles.”