The past two weeks have had some interesting and scary revelations for traditionally published authors. Kristine Kathryn Rusch has detailed it most succinctly (and I must add - fairly) in these two posts.

They're great posts. Long, but worth the read. 

In a nutshell: a disturbing number of large publishing houses have been underreporting authors' ebook sales, sometimes by a factor of ten or even a hundred. That is, they're telling authors they they've sold 30 ebooks for three months, when the real figure is closer to 3000. One publisher in particular is apparently not even looking at the sales figures, but using a flat formula based on the print sales, as evidenced by the fact that authors have noted their books (and their colleagues' books) of similar print sales figures have exactly the same ebook sales. For example, Joe, Fred and Bob all have three books out, each of which sell roughly 2000 books a month. Their ebook sales are reported as 27 books for the period, for all nine books.

Furthermore, some authors report that their royalty statement has sales reports that are actually lower than their BookScan sales figures. Which isn't possible: BookScan represents at best 70% of all book outlets. It records sales as they happen, and it can't get all of them. Your royalty statement, by straightforward logic can't be lower than your bookscan figures.

Before anyone gets too worked up in their They're A Bunch Of Evil Bastards song, though, Rusch makes a very good point about the publishing business right now. Essentially, that this isn't (necessarily) a malicious money-grab. That it's likely the result of a company forced to shave things down to the bone so far they have no flexibility left, who is then forced to contend with an entirely new format and distribution process - ebooks. They don't fit in the system. They don't fit in the accounts, and they're growing.

Publishers are in big trouble. There are several writing groups and agencies making investigations, hopefully with the intention of forcing an audit from the publishers, and forcing them to revamp and fix their accounting.

Because sadly, they won't do so otherwise. Not out of maliciousness, simply human self-preservation. We live in a world slaven to the Quarterly Profit, and anyone who dares to mess with that - like, for example, overhauling the accounting system (expensive!) resulting in having to pay authors a hell of a lot more money than they currently are (really expensive), thereby admitting they'd been stiffing their authors to begin with (potentially catestrophic.) - is essentially committing corporate suicide.

Being forced to do so by risk of a lawsuit is a completely different matter, of course. But with bookstores and bookchains dropping like flies, falling print sales, rising indie-authors, ebook publishing, the GFC and now this - it is not a good time to be a publisher. The ground is shifting so fast it's hard enough to keep up as an individual. I suspect publishers will have to change far more drastically than they realised in order to stay relevant. So much so, they'd probably be better off just starting new companies with new business models, because there's not much left of what they have now that will work, soon.