Posted
elsewhere at AW.
I'm going to natter about how anthologies are put together and how the author gets paid.
The first thing that happens is that the editor pitches an anthology to a publisher. The publisher accepts the proposal and advances money to the editor. The editor has a contract with the publisher; the eventual authors will have contracts with the editor.
The editor generally keeps half of the advance and uses the other half to buy stories. A standard professional rate is $0.05 cents/word.
So, the editor gets an $8,000 advance from the publisher. The editor keeps $4,000 and uses the other $4,000 to buy stories. Say the anthology is to be 80,000 words. The editor puts out a call for stories. They come flooding in. The editor selects the ones she wants, totaling 80,000 words, and sends rejection slips to the rest.
The authors who have been accepted sign contracts with the editor, for $0.05/word, plus a pro-rated share of the royalties (the details will be spelled out in the contract). Royalty periods, indemnity, reversion, and so on will be specified.
The finished, edited, anthology is turned in to the publisher, and in the fullness of time it's printed. Out it goes into the world. The publisher calculates royalties (standard is based on cover price) on every copy sold, but, until those royalties pay back the advance that was already paid, they don't cut any new checks. This isn't a big deal because the editor and the authors have already been paid.
Then the happy day arrives when the anthology earns out! The publisher cuts a check and sends it to the editor. The editor keeps half (and if the anthology was agented, the agent's 15% is paid out of the editor's half). The other half is divided among the authors according to one of two schemes (which will have been spelled out in frightening detail in the contract).
One way is this: For example, if there are ten stories in the anthology, each author gets 10% of the authors' share of the royalties. That is, for every dollar in royalties that comes in, the editor keeps $0.50 and each of those ten authors gets $0.05
The other way is this: each author is paid in proportion to the percentage of the final anthology that is that author's work. So if Author Ann had a 6,000 word story while Author Beth had a 3,000 word story, Ann would get 7.5% of the authors' share and Beth would get 3.75%. Of each dollar in royalties that comes from the publisher the editor would still keep $0.50; Ann would get $0.0375 and Beth would get $0.01875.
You'll notice that royalties are paid beginning with the first copy sold.
If the publisher doesn't pay an advance, then royalties are still paid beginning with the first copy, but there's no advance to pay back, so the publisher will cut a check at the end of each royalty period to send to the editor.
Some publishers pay royalties based on net. While most publishers are honest and above-board this is still an invitation to abuse and should be avoided.
Let's talk briefly about Net.
Net should be the amount that comes in the door. This will be what the publisher receives after the bookstores take their discount. Direct sales will be accounted separately.
Take a book that retails for $10.00. The bookstore gets it for $6.00 (40% discount). So for each book sold the publisher takes the $6.00 and pays the author's royalties out of that (at a 10% royalty rate, $0.60), and keeps the rest to pay for paper, printing, shipping, warehousing, marketing, publicity, the editors' salaries, art, the phone and electric bill, office rent, taxes, and everything else.
Those books which are sold directly by the publisher bring in the whole $10.00, so the publisher pays $1.00 to the author for each one sold. The publisher keeps the rest, as above.
Many publishers have found that the added cost of bookkeeping offsets any savings that come from payments on net, and so have gone to payment on cover price across the board. It's simpler.
Notice that "net" is "money coming in the door," not "what's left over after paying for paper, printing, shipping, warehousing, marketing, publicity, the editors' salaries, art, the phone and electric bill, office rent, taxes, and everything else." There are publishers that use the latter definition of "net." Their authors typically never earn a cent, because any percent of zero is still zero.
