First: if Tina’s email comes to pass, it will mean Ellora’s Cave authors will be getting paid. My commentary follows Tina’s email.
From: theeternaltubthumper
Date: Nov 6, 2015 1:33 AM
Subject: [ec_biz] royalty info
I wanted to let everyone know to expect a check for March-June (hopefully!) before Christmas!! 🙂 Checks have resumed going out daily along with their accompanying reports. As these reports are being pulled individually, it will take a solid 1-1.5 months to get them all verified, and mailed. After March-June is completely done, we will repeat the process for July-September (or July-October if it takes closer to 1.5 months than 1 month to mail all the March-June checks.) Point being, everyone will be 100% caught up soon!!
I won’t bore you with too many technical details, but I do want to try and semi-explain the software for the reports: every month has to be pulled, verified, and re-verified before a check is cut. We wanted to send out one check covering March-August, but July and August still need pulled, verified, and re-verified; we figured you’d rather get March-June now and the remainder in the next batch as opposed to waiting on those reports so everything could be included in 1 check. (And hopefully that made sense!)
At any rate, Courtney is busting more butt than usual in an effort to get everyone’s March-June checks to them in time for the holidays. The less email she receives over the next month, the better. Obviously if there is something that needs brought to her attention ASAP, please do email her. Otherwise I will post here when the last batch of checks are mailed so you know to contact her if you haven’t received your check within 10 business days of that date.
Last note: we are going to be switching our biz loop to a different, trackable system after the checks are caught up so we can resume open communication. We are very sorry we’ve had to go nearly silent this past year and look forward to resuming open communication with you to keep you apprised of what’s happening at home base.
If you don’t hear from me beforehand, please have a very Happy Thanksgiving 🙂
Tina/Jaid
Sooooo…Tina’s pre-announcing checks. Remember January’s pre-announcement?
And EC’s going to switch to some trackable system that even major tech companies do not use because…why, exactly? EC’s communication wasn’t top notch even before the whole Dear Author thing went down. It’s not Jane’s fault, nor Courtney’s, nor mine, nor any of the other participants in #notchilled.
Well, I’m glad you clarified that, Jaid. Really. (Note: screenshot is of this link.)
¡¿Four to Six Weeks Per Quarter!?
Let me get this straight: Ellora’s Cave’s controller is spending a solid third to half her working hours verifying (and inputting) royalties and issuing checks. There are, as of October 19th, 813 Ellora’s Cave authors, but let’s round that down to 800 for easy math, which translates to 133 to 200 authors per week.
If we assume eight-hour days and five days a week (even though that’s optimistic), that’s forty working hours a week. An average day would therefore mean 26-40 authors’ royalties verified; an average hour 3.25-4 authors.
Assuming there’s no easy way to make the work process more efficient (doubtful, but let’s run with it), what’s the easiest way to reduce the workload without reducing profitability?
Chop the long tail. From that post:
With over 800 authors, some of those authors are going to be bringing in peanuts and others whole food trucks. Release the authors that are consistently not performing.
As an example, calculate how long it takes to put together all the royalty information, divide by the number of authors. Figure out how much you’re paying the people who do that work, including cutting the checks. Triple that cost. For the authors who aren’t making, on average, that much for the house over the last year, offer to release their titles (for no fee).
Also, it’s probably true that anthologies are the most difficult. Given that anthologies divide royalties between contributing authors, for every anthology, you’ve got to do the work N times. Unless those are really really big sellers, then it’s time to give them a neutral look with a profitability eye.
If some authors aren’t making more for the house than the cost to cut the checks, it’s saving both money and time to cut those authors from the list.
It’s also unclear to me why hand verification of each author is necessary. Even indie authors get spreadsheets from Amazon. Those spreadsheets include things like:
- ASIN
- Quantity sold (also includes KU/KOLL if those features are enabled)
- Price sold at
- Currency
I can see one possible configuration of the required database tables in my head:
- Authors
- Books (this would include a field for whether the payment for this book was based on cover price or sales price and the royalty rate for this book)
- AuthorsXBooks (many-to-many join table with at least one additional field for royalty %)
- SalesOutlets (e.g., Amazon, All Romance Ebooks)
- BooksXSalesOutlets (to hold things like Amazon ASIN and URLs by site)
- SalesOutletsCurrencyMonth (i.e., for Sep 2015, Amazon’s exchange rate for UKP was USD $1.59)
- SalesXBooksXSalesOutlets (Also links to SalesOutletsCurrencyMonth for non-USD sales. Basically, this keeps sales price (which can be multiple values per sales outlet per month), month sold, quantity sold—and stuff like that.
- RoyaltiesXSalesOutlets (totals received from each vendor by period—the check-and-balance in double-entry accounting)
- PaymentsXAuthors (check #, time period covered, amount)
Then write an importer for each file from each publishing outlet and some good unit and functional tests for edge cases. If the royalties (including the publisher’s share) total the payment received, it’s good.
What still mystifies me: if this new royalty application has caused (or helped cause) so much consternation and cost since 2013, where’s the lawsuit for that?
Why Is Tina Pre-Announcing Now?
Let’s look at a timeline here:
| Date | Event |
|---|---|
| 08-18-2014 | Ellora’s Cave Layoffs. |
| 09-24-2014 | Laurann Dohner’s Darkness, a book in her New Species series, released. Shortly after, the book becomes a NY Times bestseller. Amazon monies for this would start coming in the end of November (assuming the same payment schedule as indie authors); All Romance Ebooks payments would arrive mid-November. |
| 10-29-2014 | Laurann Dohner’s Smiley, a book in her New Species series, released. Shortly after, the book becomes a NY Times bestseller. Amazon monies for this would start coming in the end of December (assuming the same payment schedule as indie authors). |
| 1-7-2015 | Tina/Jaid’s post to the biz loop about the status of royalty payments. (Note that one editor commented a few days ago saying that she’s still not been paid.) |
| 9-8-2015 | Laurann Dohner’s Numbers, a book in her New Species series, released. Shortly after, the book becomes a NY Times bestseller. Amazon monies for this would start coming at the end of November; All Romance Ebooks payments would arrive mid-November. |
| 10-28-2015 | Alien, an anthology featuring four Ellora’s Cave authors is released. One of the four stories is a new Zorn warriors story from Laurann Dohner. |
| 11-6-2015 | As quoted above, Tina/Jaid’s post to the biz loop about the status of royalty payments. |
The point is: these little boom cycles where EC crows about being able to pay their authors follow fairly closely on the heels of Ms. Dohner’s book releases.
Which begs the question: Given Laurann Dohner’s announcement of a new self-published series, what’s going to happen when Ellora’s Cave no longer has new bestselling titles from her to rely on?
Speaking of Ellora’s Cave Releases
Let’s look at that image up top again.
After the August 2014 layoffs, EC immediately dropped from nine to ten releases per week to eight for the first two weeks of September, then five for the third (which was the week The Curious Case of Ellora’s Cave was published). So there’s absolutely no way that Dear Author’s article could have triggered that change. The following week bounced back up to eight releases, but the last week of the month—the week that Ellora’s Cave filed suit against Dear Author and Jane Litte—went back up to nine releases.
Part of the reason for the drop was the elimination of the Blush line (though there still would be releases of already-contracted Blush titles), which had typically accounted for one or two titles on a Thursday release. Non-Blush EC titles were released on Wednesday and Friday.
Over time, the number of releases slid…no week in December 2014 had more than six releases in one week, and the final full week featured only three releases.
With the exception of July, releases for 2015 ran about half that of the previous year’s releases, dropping even lower by August.
What’s also interesting is that since October, 2014, Micah BlackLight’s The Cult of the Serpentari has comprised 27 releases—more than any whole month since October 2014—first as 24 volumes chapter-by-chapter (from October 2014 to April 2015), then three omnibus volumes published in May 2015. It seems pretty clear that the old pricing structure wasn’t working as 24 volumes worked out to be a lot of money.
I said to Rick, “I’m not quite sure what to say about this graph.” Except perhaps that romance writers came to feel about Ellora’s Cave the way majority owner Tina Engler/Jaid Black clearly feels about them.
Rick said, “Perhaps some arch comment about starting a new chapter in their business?”
Edit Note
11/16: I’d inadvertently deleted the final two rows of the dateline table when I had two edit windows open and continued in the wrong one. Only realized this a week later.
As always, interesting! Thanks for posting this!
You’re welcome!
Any halfway competent accountant (or clerk) could collate royalty information from all vendors by hand in a matter of days just using Excel. It would be a royal pain in the ass, but it’s easily doable and wouldn’t result in coauthors being paid different amounts for the same books.
In short, none of EC’s excuses regarding royalties make a lick of sense to anyone with any experience with Excel or databases or even using a telephone to call AccountTemps.
Tell us another one, Tina.
What DOES make sense is that they’re using LD’s income (as your data suggests) to pay out what royalties they have paid over the past year. Not sure what they’re using the rest of the royalty money for. But again, that’s just conjecture based on observation and public reports from authors. If EC has a different tale, I’m sure we’d all like to hear it. But the nonsense about “accounting software” demonstrates incompetence, at best.
Yep, you can make a master spreadsheet of the authors, their royalty percentages, and the ISBNs/ASINs/etc. of their books and have it do lookups on the downloaded spreadsheets each month.
I do quarterly royalties for my small press. i have no bookkeeping experience. I have 32 different people who get money, and all in different percentages. Okay, it’s not 800. I have six different sales outlets to keep track of, including Amazon and ARE.
It takes me 20 minutes after each event to put in the hand sales.
It takes me most of an evening (4-5 hours) to calculate royalties. I do it mostly by hand and by calculator. The paypal goes out that night. I usually write checks the next day.
800 is about 25 times the number of my authors. I can see taking two weeks to calculate royalties. I can’t see two months,
So even doing it your way would be 12-1/2 days (2-1/2 work weeks) for a company the size of EC.
Seriously. 800 isn’t a deal breaker. 2000 wouldn’t be a deal breaker. It would take tens of thousands of author records to make using Excel a deal breaker. Awkward, time-consuming and annoying? Hell yes, but easy enough to put out quarterly at least and most likely monthly payments.
Follow the money. This whole royalty mess is at the heart of what’s wrong.
I find all of Paro’s attention on Ann Jacobs really telling, especially since he has Ellora’s Cave’s blessing via Jaid Black (and I recall Patty Marks commenting in one of the threads as well).
Tina’s attack dog is doing his job, I guess. I wonder if they’re paying him.
And how fitting that the only attack dog they could afford is a yappy little mop dog.
Hm. Wonder if Paro could be the elusive @pubnt?
While I think that Paro is a failed experiment in artificial human intelligence I doubt he is the elusive pNut. He didn’t show up until months after the Judge essentially muzzled EC’s sock puppet. Like so many leeches he is trying desperately to cling a D-list personality in order to have someone, anyone, pay even the slightest bit of attention to him.
I believe he and Jenny Trout had run-ins before @pubnt showed up, too.
Nope, not a chance. One of the interesting things about @pubnt was how little misogynistic language pubby used. Much like Tina’s perspective, in fact. Lots of ableist language, though.
That chart doesn’t just speak, it shouts.
Rick just said, “Wow, infographic for the win. That’s almost as devastating as the famous one about Napoleon’s march on Russia.”
Fascinating to see the inner workings of the EC School of Management.
Why is the a Controller doing bookkeeping? Sounds like someone is being paid in titles rather than $$$.
So EC is saying that it’s a mechanical issue holding up the payment process? Their reputation is mired in mud because the single person needs so long to calculate and verify each payment? That only makes sense if EC cannot afford any of the sensible options other businesses use. Hire more bookkeepers. Failing that, hire several qualified temporary workers with adequate spreadsheet skills for six weeks to catch up. Bring in an accounting firm to fix this.
And if cash is the issue, that’s what business loans are for. Companies of any size these days do not operate on their own cash. They borrow it to smooth out the cash flow. companies boasting million dollar revenues are not living from paycheck to paycheck. (Business School 101. If EC’s controller can’t guide them through this, then she really didn’t learn what she needed when they sent her for training.)
Still amazing how EC was able to survive for so long with such an apparent lack of finance management and business operations skills.
“Why is the a Controller doing bookkeeping?”
I can think of a few possible reasons, including:
Both of which seem more controller functions than bookkeeper functions.
Edited to add: also, with only five releases last month, it really seems like EC may no longer be big enough to justify paying two people. I’m actually surprised we haven’t heard about more layoffs.
I don’t think that, at this point, there are all that many people to lay off.
Adding on here in case there’s confusion, especially since TE is on record as believing that tax liens are the gov’t’s low interest loans to small businesses.
The reason companies operate on borrowed cash is that they invest their own $$$ at rates that exceed the borrowing cost, and then deduct the cost of borrowing as a business expense. Additionally, businesses invest in assets that depreciate, providing another tax write-off. Maintaining good credit with lenders is essential to successful businesses, because that’s what determines the interest rates they will have to pay. When a business of any size can no longer borrow, they are in grievous straits indeed.
To be a bit fair here, that was one of pubnt’s claims.
https://twitter.com/pubnt/status/567170983271075840
While quite a few of us believe that Tina was at least involved in @pubnt’s spew, it’s also fairly obvious that, even if she were the sole voice of @pubnt, she’d have said different things under her own name.
Fairly certain that TE claimed it herself in an EC post that disappeared some time ago. Pnt echoed the assertion, but that came later. I remember a patronizing tone in TE’s explanation that was particularly grating.
That’s possible. I remember her saying something about the liens, but it wasn’t particularly interesting at the time. Oh well.
The claiming that tax liens were intended to be government approved tax incentives to various business entities was the height of pNut’s insanity. “No PNut, bad dog”. Tax liens are Uncle Sam’s way of making sure that a failing company can’t liquidate assets without the government collecting its due.
See, here’s an example. Company A owns an office building and a warehouse. When times get tough; everyone, including special snowflake companies that claim they created an entirely new genre of literature, have cash flow/liquidity problems that cause them to have to scramble come tax season. If they somehow failed to pay appropriate quarterly tax reports they might be hit with a whopping bill at fiscal year end. Say things are even more complicated because the owner is also a content provider but has distanced herself from her company and its day to day operations. Now, extrapolate to the fact that there simply isn’t enough pennies in the coffer to pay the taxman. The government, like most powerful entities don’t trade in excuses. They want to be paid in cold hard cash. If Company A didn’t plan carefully and doesn’t have enough cash to pay the taxman, then the taxman is going to get pissed and secure a lien to cover money’s owed. That’s not a tax incentive, it’s a major red flag that your company is being managed by imbeciles and that all other respectable lines of credit have dried up.
In other words, a tax lien equals a company in severe financial difficulties; not a company in a merry pact to ignore its fiscal responsibilities. “Try selling the property with a lien attached, Tina.” I think you will find that the government will step in first to reclaim the monies owed and accrued penalties. Then, and only then, will any profits be apportioned to the title owner.
There is only so long a company can blame cash flow problems on malfunctioning software. We are coming up on the 2 year mark for this excuse and every time EC goes on and on about their laborious hand checking and verification process. Yet, they haven’t sue the vender or returned to their old software that apparently worked fine. Well as fine as accounting software can be that doesn’t allow for EFT. Face it EC, no one is buying your excuses anymore.
And EC, if you are reading this, you did NOT create the erotic romance or the erotic romance market. You were an early competitor but you have long been eclipsed by other companies with a keen eye on a very rapidly changing marketplace. You failed to innovate or adapt to new trends. You failed to understand the implications of the rising self published author and how that affected pricing and promotion. And you REALLY missed understanding the Amazon revolution in publishing.
On the EFT thing, I’m betting very few EC authors would be willing to share their checking accounts with EC at this point. Still, why not pay by PayPal? Redbubble does this for me and it’s pretty awesome as an option.
There has been erotic fiction and erotica around for HUNDREDS of years. Marquis de Sade, for starters. And has anyone ever read a little ditty called the BIBLE??? There’s some pretty racy stuff in there. (Maybe not by today’s standards but yeah, there is.)
Erotic fiction/books was available gasp before EC was ever created. Nay, before the Internet was a THING.
The only thing EC created was a viable independent online marketplace to make it easier for authors and readers to match up. And yes, I will give them all due credit for that, they were an industry leader there.
Doesn’t make them the “inventor” of erotic fiction. Not by a long shot. And I’m sick and tired of hearing that erroneous claim from them.
For them to claim they “invented” a genre of fiction is pure bullshit. They might have trademarked a moniker for a certain style of erotica, but erotica’s been around FOREVER. It would be like Isaac Asimov trademarking “science fickshonna” and claiming he “invented” a genre. Nopety nope nope.
Erotic fiction has been around a lot longer than many realize. Here are just a few more notables:
Lady Chatterley’s Lover, 1928, by D. H. Lawrence; Story of O: A Novel by Pauline Reage, 1954; Delta of Venus, 1978, Anais Nin; Tropic of Cancer, 1934, Henry Miller; works by Collette, early 20th century…It’s actually a pretty substantial list.
EC contributed to making erotic stories available in digital format, which was indeed a major development. Now if EC could only have laid claim to 50 Shades…
Actually, we can go a lot further back–Fanny Hill, anyone?
Here’s the thing with TE’s RWA rant. Her mother, who is the ceo, ADMITTED to the RWA’s executive director that they were not up to date with their royalties. And what made people boycott EC was the filing of the lawsuit against DA, not anything Courtney Milan, Deirdre or anyone else said. Courtney and Deirdre translated lots of legalese for laypeople, and rightly kept the spotlight on EC’s bad behavior.
What’s interesting now is that Tina’s basically saying what her mother said to the RWA executive director was untrue…at least that’s how I’m reading it.
Of course, Ellora’s Cave never said it wasn’t true in their filings after that fact, only that it was “irrelevant.”
Hmmmm. Irrelevant like their lawyer’s indignant statement that his lack of payment was both false AND an irrelevant truth? Which was it Steven?
Or like claiming people are lying about non-payment while promising that 1st Qtr payments will be in the author’s mailboxes before the Holidays (months beyond the contracted terms and well beyond their years long policy)?
Or that a house built on Erotic Romance and the hundreds of women who write it is no longer interested in maintaining relationships with the vast majority of those that read or write it? Because they dare to expect to get paid for their work and wont be cowed into silence? Or expect that the money they spent will end up in the appropriate hands?
Irrelevant like that gosh darn accounting software they spent thousands on more than 2 years ago that STILL can’t correctly calculate a royalty check?
And the biggest whopper, that the defense was playing a media smear campaign when DA was virtually silent, all the while a sock puppet(s) for EC attempted to hijack discussion of the case or EC’s ongoing problems?
You know what I think? I think EC may have just bombed themselves back to irrelevancy.
Let’s hope so, Julaine. Time to eradicate the cockroaches.
And PS — if Steven Mastrantonio is being paid in a timely manner, I would be astounded. How about some documentation of that, EC?!
Must I pick just one? 😉
That…doesn’t even make sense TE would say that??? Why would someone lie to the RWA about their situation that would rightfully lead to sanctions by the RWA, making it HARDER for them to do business?
…Does…NOT…compute…
It’s amazing that EC seems to be the only publisher I’ve seen who crows about…having to get caught up?
I guess I’m spoiled by publishers who pay ON TIME, every time, and it’s not a big deal that they pay on time because…well, they pay per their contract stipulations, every time.
It’s amazing that EC seems to be the only publisher I’ve seen who crows about…having to get caught up?
I guess being in the software field so long, I’m kind of used to product pre-announcements. Still, pre-announcing that delayed payments are going out? Pretty much a first.
What kind of company has to make a special announcement that they plan on paying their employees and subcontractors? Isn’t that supposed to be a given?
Instead of worrying about creating “trackable” communication systems, why not use that time and money for accounting software that actually works?
Because (snarky opinion ahoy!) the point is not, and has never been, to pay monies owed, but to find targets to threaten with litigation, in order to continue to silence the majority of the remaining authors under contract.
Finding out who betrayed her seems super important.
She seems to be an incredibly vindictive human being. As does her mother.
Did Tina realize when she was blasting Romance writers she was also blasting READERS, readers of not only Romance? Most Romance readers are women and many women read cross-genres. So maligning one segment of the writing/reading population means maligning others.
If this company was being managed correctly, after all of this brouhaha, the CEO would reorganize positively, announce that they were correcting the issues with the largest writers organization in the country, and then market themselves in that light.
There was a time when I would have LOVED to have been an EC writer. Fortunately, I wasn’t…another house picked up my erotic romance.
There was a time when I admired Tina/Jaid for being an industry leader.
There was a time when others admired her.
Evidently that time has passed.
It’s a difficult situation for all involved, but especially for those authors who needed royalty checks.
EC may now accept submissions from other genres, but the experienced writers in those genres, the ones who could produce the best stories, now know about the issues surrounding this publisher. The quality of EC books may take a huge hit.
Like I said, a difficult situation for all involved.
Mitzi
It really is a difficult situation, especially with so few titles coming out a month. It’ll be interesting to see how that changes over time.
BTW, even if “Courtney busts butt” or not to get checks March-June checks out by the Holidays they will STILL be several months late. March was 1st quarter, those of us living in the real world, will note that this is already quarter 4. How is EC planning on paying their obligations in the future if their last big rainmaker decides to go the self published route or signs with a major House like so many other EC authors have?
I can’t help but wonder this too. Seems like their overhead’s costing too much, for whatever reason.
I wonder what chicanery they might try to pull with Laurann once she actually self-publishes. Something tells me they’re not going to let their last big fish go easily, but hey, I could be wrong. The good news is that Laurann very likely has the cash to sue EC if they try to sue her for it. That’s a luxury 99 percent of EC authors don’t have.
It’s too bad that such a talented author and nice person ended up in this situation. I have the greatest of respect for Laurann and, once she self-publishes, I can’t wait to start reading her work again. I could not bring myself to buy any of her work while she is still published by EC. I’m glad she’s leaving that place.
I think Laurann will be just fine. 😉
I can’t wait to read her work either.
Just because she self pubbing, does that mean she’s leaving EC?
If that is her intent, she has not yet announced it.
Luckily, we now have confirmation that she plans to continue all of her series (including New Species) as self-published works. Guess that last oil well just ran dry, EC.
So LD’s contract is up?
That’s a long and complicated story that’s not my place to tell.
It’s my understanding that she’s written her last book for Ellora’s Cave, though.