Book Publishers: Are They Car Companies or Banks?
Amid all the horrible economic news, there was a little blip in book publishing this week that may turn out to be a milestone in the evolution of the business. Three major publishing houses announced significant changes–the remaining firms will certainly follow suit in the weeks and months ahead.
The problem is the cascading effect of a collapse in sales. Boris Kachka, New York magazine’s publishing reporter, takes this to mean Random House is like General Motors, a sclerotic firm plagued by too many marques and overcapacity. Surely the six major publishers produce far too many books over-stuffing bookstores with less-than-compelling fare.
Others will view Black Wednesday–the moment earlier in the week when Houghton Mifflin lost their publisher; Random House carved up the remains of its decade-old Bantam Doubleday Dell acquisition and fed the pieces to the firm’s own sharks; and Simon and Schuster announced 30+ redundancies–as a product of the relentless digitization of entertainment and information. In this scenario, books are just another victim of the collapse of the print business model that has already pushed the newspaper business to the wall.
Although no meaningful alternative to printed books yet exists (hello, Amazon, we’re all waiting for Kindle numbers here!), skeptics have been predicting the demise of books for more than a decade even as sales of individual titles grow to higher and higher levels. Indeed, one of the curiosities of the book business has been its role as revenue generator of last resort. In our new media landscape where there is less friction against generating fame, it is also harder to generate cash from one’s notoriety.
Basically, you’ve got two options: speaking and book sales. Both business have grown dramatically since everyone gave up on the future of the book. And there’s a long list of celebrities–real and imagined–who milk their fame through appearances and bestseller lists. If that’s the case, why is the publishing business in such bad shape? and will this downturn be more than a cyclical slump?
To answer the second question first, yes. And now, the first: the publishing business is more like the over-leveraged banks that have lost their business model than the cost-heavy car business that needs to deal with its legacy burdens (and become less dependent on pickup trucks.)
Publishers, like banks, are cutting jobs because that’s the only thing they can do. But none of those employees are the cause of their losses. At the banks, management needs to raise cash to cover collapsing asset values. For publishers, an overhang of leverage is burying them. And job cuts won’t begin to address the problem.
Now, when I say leverage you’ll immediately think of a firm like Houghton Mifflin that was bought by a private equity player. Last week, they ineptly announced that a freeze on acquiring new titles. It was the first sign of a terrible cash squeeze. So you would be right read leverage as too much debt. But only in that one case. Debt is not the leverage that’s killing the book business.
For many years now but accelerating recently with the rise of celebrity non-fiction, the major publishers have gotten leveraged up on new authors. When Houghton announced their freeze, the company got pilloried for the decision. How can a publisher survive if it doesn’t find new authors and books? Agents were outraged.
But the dirty secret of the book business is that publishers have issued advances–a guarantee against future royalties that is like a bond–the way banks pumped out mortgage-backed securities and CDOs. They did it recklessly and with abandon, hardly doing any meaningful research. Author advances are the original no-doc mortgages. They base their lending decision on nothing more than a feeling that the author is good for the money.
Advances are a bit like credit default swaps too in that they involve one party taking on outsized risk while the other party is protected both ways.
What do I mean? Well, think of it this way, an author receives an advance based upon publisher’s expectations of their ability to generate sales. Publicity is assumed to be the precursor of sales. So publishers pay for authors they believe will get a lot of attention: politicians, tv personalities, figures with excotic personal stories or tragedies, diet doctors, alluring novelists and cork-screw coiffed pop scientists, bloggers, business gurus, CEOs . . . the list goes on and on but you get the picture.
Book agents exist to manage–and, at times, incite–bidding among houses but it is the publishers who make the decision to give Ted Kennedy $8 million or an obscure insurance analyst who has been palling around with Warren Buffett $7 million. (In an interesting footnote, most people don’t realize that Doris Kearns Goodwin exploited a similar intimacy with LBJ to establish herself as an author. Though she had to wait for another book or two to get the big advance.)
With those advances, the publisher assumes all of the risk for the author. The publisher is leveraging the perceived future revenues with present cash flow. In the layers beneath the multi-million dollar advance, there are scores of these risk grenades–they’re certain to do ugly damage–weighing down the book companies’ balance sheets.
These are the costs that publishers need to reduce. Unable to renegotiate these crippling deals, Houghton did the sensible thing and called a moratorium on further damage. Rightly, they think they should stop shoveling if they hope to get out of the hole they’re in.
The hole has been made bigger in recent weeks by the collapse of retailing. This is ironic because books are supposed to be a consumer staple, an anti-recessionary cheap form of enriching escape that thrives when the economy stalls. Even funnier, books themselves may hold up well in these tougher times. It’s booksellers and book publishers who will suffer.
The sea change in the book business isn’t from print to digital. It’s not from paid content to free content like in journalism. The sea change comes from the shift away from bookstores. No one goes to Borders or Barnes and Noble anymore. It’s just not a stop on the weekend errand-and-entertainment circuit. If you want a book, you swing by the power aisle in Costco, browse the airport newsstand or one-click from Amazon. The books that do sell sell better than they’ve ever sold before. Just ask the Twilight girl or Nassim Taleb.
Unfortunately, these successful authors are subsidizing all of the failed ones. When the book publishers lever themselves up, they play Robin Hood. They steal from those rich in sales–who only receive a fraction of their book’s value–and give to the poor souls who think they’ve got something interesting to say. Publishers engage in a massive redistribution from the deserving earners to the undeserving posers. And, in case you want to clutch the old myth about mass crap supporting high-brow art, the undeserving here are truly undeserving. They’re that long list of misbegotten peudo-celebrities above. (How things got this way is another, longer story. I’ll tell it to you some other time.)
So, like useless McMansions in the exurbs, most books are mistakes. The good news is that there’s a solution for the publishing business. But that will have to wait for another post too.
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Source:
Who Will Bailout the Publishers?
BORIS KACHKA
New York Magazine, December 5, 2008
http://nymag.com/news/intelligencer/52761/
December 6th, 2008 at 11:35 am
Nice piece
December 6th, 2008 at 12:21 pm
I’m going to make a prediction here Barry. Books will encounter a renaissance. My reasoning is that kids and really virtually everybody is retraining their minds to read again. The TV is losing market share to reading on the net and text messaging. This is not only expanding our brain capacity to read but is giving people an ever growing hunger for more information. Think of how exercise feeds the need to get even more exercise and health due to the endorphins in a positive feedback loop. Well, as we build up this muscle called our brains, it will require more and more information to keep it busy.
Books can be both practical and nostalgic so that is why I am predicting they will make a comeback. I know myself that I am actually thinking along the lines of buying books to fill ‘gaps’ in my day and almost every time I sit down for a few minutes anywhere my main source of entertainment is to now read something to the point now where it is almost an addiction. And I’d much rather jump into a story than read a few minutes of a newspaper article. This is a huge change from a few years ago when I was more interested in the visual medium of TV and movies. I suggest I’m not alone but I’m probably just eccentric(even though stories on the younger generation[hello Harry Potter] would probably agree with me)….no comments please (;
I don’t know if newspapers will be pulled out of their dive but real stories, information, creativity and escapism will probably be demanded more and more going forward
December 6th, 2008 at 2:04 pm
DavidB – am in your camp sort of. Imo real recreation will return as the 2 dimensional world gets old. The blogs add a 3rd dimension … interaction.
And BR – do you have any stats on how many books get bought by schools and public librarys? Is there a payolla system in this realm or do these institutions get freebies?
December 6th, 2008 at 2:47 pm
“Although no meaningful alternative to printed books yet exists”
I know how books can be better than a website, but I think everyone is waiting for the same ‘book experience’ to emerge in a different form, which will not happen in a big way. Instead the way we get information has changed and will continue to do so. I know there is often better info in a computer book than the on the net (I’m a programmer), but usually I only want a nugget and continue on my way. The web is better for that, so I’ve migrated here. Over time it has changed the way I learn — I used to read a whole book on a subject, now its more ‘look up, figure out, look up..’ (which is much more effective). The same has happened to a certain extent with how I consume entertainment. Kind of like a movie vs a few youtube videos. Even with higher quality, people don’t want to waste their time (and money) on chapters that are just filler.
As I’m sure you know, there are also plenty of non famous authors getting totally hosed by the publishing industry as well. It is borderline criminal, and I have no sympathy for the publishers. As for bookstores, gosh, where will I go next time I need info on the occult or new age crystals. Its not just that the books are 99% garbage, so are the categories themselves.
Funny how every industry that is tanking spent years deceiving customers and suppliers, tricking them into debt, deceptive advertising, spamming… I can’t get over how shareholders cheered this on, thinking those same people would be looking out for them. “It is their duty to look out for shareholder value” — ha ha. They are people with no morals, why in heaven’s name would they care about the shareholder suddenly? They should have learned at Enron.
The idea of helping all these people out is to avoid the mistakes of the depression, but nobody wonders how shitty the next fifty years would have been if the depression didn’t clean out the scumbags than dearly deserved to be gone. I guess we may find out this time.
Well this got pretty off topic : ). Great post, looking forward to part 2.
December 6th, 2008 at 5:08 pm
What do you think the odds are of Barry’s book being carried by the airport newsstand or Costco?
And as the the driver of a Twilight obsessed teen, if you say people don’t still go to Barnes & Noble or Borders, then explain to me why I have trouble getting a parking spot.
Bookstores beat the crap out of Costco, because most bestsellers are crap. Plus, I like the fact my kid likes hanging out at B&N rather than Costco (and who really likes hanging out at Costco). Bookstores beat the crap out of Starbucks because Starbucks doesn’t have magazines to look at while you drink (however, I do wish bookstores would sell a better quality of coffee than Starbucks or Seattle’s Best).
The internet has certainly changed things and shrunk margins for virtually everything, but I’d be willing to bet bookstores will be around 20 year from now, well maybe not Borders, but bookstores as an entertainment destination will be, just as movie theatres will be.
December 6th, 2008 at 5:21 pm
Just because people are hanging out at Barnes and Noble doesn’t mean they’re buying any books. They’re not and the contraction of the publishing business is a direct product of the lost sales at BN and Borders.
You do understand that your average Barnes and Noble is filled with books that make little or no money for the publisher because the advance was much too high or with books that generate little or no meaningful income for the author. And many of those Barnes and Nobles will be closing soon. More to the point, most of the Barnes and Noble stores simply drove independent stores out of business. So there hasn’t been much of net gain in bookstores. Mostly a net loss.
And if you think Movie theaters will be around for a while, you haven’t been paying much attention to the movie business.
December 6th, 2008 at 6:20 pm
This is a very well written piece about one of the problems faced by publishers, but I don’t think that over leveraged advances are the real issue here. Houghton Mifflin – as you state – really had nothing to do with advances. At their heart, they are a $2+ Billion education publisher. Their trade sales only account for less than 10% of their total sales. Education publishers (who make up the largest publishers in the world) don’t give very big advances, and are generally very profitable. University Presses, scholarly presses, religious publisher, and children’s book publishers are also generally stingy when it comes to giving out advances.
General Trade publishers like Random House, Simon & Schuster, & HarperCollins certainly do have some unearned advance issues, but their numbers are all subsumed under larger media conglomorates, and aren’t made public. The ‘big 6′ Trade publishers (Random, Harper, Macmillan, PenguinPutnam, Hachette, and S&S) probably account for 30% – 40% of the general trade books published in a given year. There are many, many smaller trade publishers that don’t have big name authors, and generally don’t give out big advances either.
There are many issues that are weighing down the publishing industry right now, though. The free returnability of books, especially from wholesalers and retailers who receive the books at highly discounted rates is one of those issues. If there is over leverage of cash flow in publishing, this is where you will find it.
But, the biggest issue I believe is that there are just too many books competing for the attention of readers whose time is often taken with lots of other activities, and leave less time time than in years (or generations) past for the undertaking of the long narrative form.
There is no shortage of authors, publishers, or retailers. There is a shortage of customers.
December 6th, 2008 at 6:38 pm
You’re wrong about returns. They have almost no impact. The supply chain has eliminated returns as a significant cost. Books are demand driven with reprints arriving in stores very quickly.
You’re also wrong about Houghton. The freeze only applied to the trade books. Houghton essentially made a choice to eliminate the trade books because they don’t generate any cash. You’re right that the trade books division is essentially irrelevant to the education businss.
You’re wrong about almost everything else. There are numerous publishers who don’t give out much in the way of advances but they also don’t generate much in the way of sales and are not terribly profitable.
On the big books, there is no shortage of customers. The top books sell regulary into the millions of copies. Those are not numbers that anyone in the books business was accustomed to seeing until less than 10 years ago. Then every house had a title that sold like that. The problem is that publishers began to chase the massive hits with massive advances and ended up over-leveraged against sales.
Your comments about the RH, SS, HC, Penguin, Hachette, Holtzbrink not having separate numbers is wrong too. Though each of these companies is owned by a larger entity, they all of have a p/l and are expected to contribute to the larger enterprise. Advances have the biggest impact on the cash they can contribute.
Let me make something very clear. Books are not doomed. Bookstores are doomed and the big six publishers have a collapsing business model. Morgan Stanley and Goldman Sachs have seen their business model collapse too. It doesn’t mean they can’t come up with a new one. But for publishers, the new model will have to address the way rights for books are acquired and how revenues from the titles are apportioned between publishers and authors.
December 7th, 2008 at 5:24 am
Excellent piece. There is yet another area where the future has been sold before it arrived.
My favorite is the patent area. It used to be like: investment, invention and then a well founded claim on future revenues via a patent. Now it is minor (but high number of cases) investments and then a doubious claim on future inventions/products to be done by others. The costs are carried by random victims who gets slapped with a patent suit for their own inventions and by the society which is not getting access to innovations due to fear of lawsuits.
December 7th, 2008 at 11:37 am
Sometime in the last 30 years there was a big change in the tax laws that meant that publishers could no longer take deductions for the expense of storing unsold books. This made it unprofitable for them to carry a big backlist, and it meant that books went out of print rapidly, which was bad for authors and the reading public, who were stuck with a revolving pile of junk.
The ease with which one can obtain 2nd hand books over the internet has mitigated the stituation for the consumer, but the author and publishers receive little benefit thereby. Perhaps books on demand will change this somewhat, though so far, books on demand are not attractively produced, as yet.
Perhaps we could think about changing our tax laws in such as way to foster intellectual life instead of harming it, now that we are entering a period of reform.
December 7th, 2008 at 1:00 pm
As a previous book editor and current book author, I can’t say that your observations are particularly informed.
First, it may appear to a media type that celebrity books are the most important, notable, or newsworthy books to appear, and they certainly are events in and of themselves. But it would be unwise to draw conclusions on the entire industry or overlook all the other books that are sold based solely on, say, Bill Clinton’s advance.
You also misunderstand the author/agent/publisher relationship. There is a market for unpublished books, which are not unlike commodities to be bought and sold. In entering a contract, a publisher is not gambling that the author is “good for the money.” It is the author’s responsibility to deliver an acceptable manuscript, it is the publisher’s responsibility to publish it in the manner in which it will make both the publisher and the author the most money. An advance on royalties is an industry standard because books don’t write themselves, and it is unreasonable to expect that an author will have the time or finances to write a book without an advance. Without advances, publishers simply don’t get books, or enough books, or good books.
Also, publishers do anything but gamble with advances; they’re very well informed about the markets to which they sell, what kinds of books and authors sell better than others, and what are reasonable expectations for any given book. In fact, their marketing departments will often ask B&N how many copies of a specific book their buyers would be willing to buy. Sales projections from this and other sources go into P/L reports that incorporate returns (yes, actually, they’re extremely important), book production and shipping costs, as well as the advance, in effect, the whole gamut. Though I have not worked in other industries, the process seems no less risky or ill-informed than any other widget shop you could compare with book publishers.
Also, the statement “When the book publishers lever themselves up, they play Robin Hood. They steal from those rich in sales–who only receive a fraction of their book’s value–and give to the poor souls who think they’ve got something interesting to say.” is incorrect. Any money an author receives is based on royalties. If the agreed-upon royalties add up to more than the advance, a successful author gets more royalties over and above what they received for the advance. In the event of heavy sales, their royalties can also actually escalate from, say, 10% per book to 12.5% or 15% at certain sales levels. And if a successful book balances out, say, three books that didn’t earn out their advances, one could consider them R&D costs of nurturing future talent that will some day create the next blockbuster best-seller.
No, what the book publishing industry suffers from is the same as all the other industries suffer from: It’s the Economy, Stupid. People simply have less money, and their reading and entertainment habits are changing. The book industry also suffers from self-appointed management experts who have no earthly idea what they’re doing. You can contact me directly about a world class management self-immolation that I can’t really write about here.
Also, library sales are extremely important–there will be fewer of these for publishers, obviously. Costco/BJ’s/Sam’s Club and other non-bookstore venues are considered “special sales” that are, on most contracts, accounted for differently and with much less benefit to the author.
But advances are not “liar’s loans.” This is a phenomenon (and a catchy and now-overused phrase for journalists) in a different industry, in search of a new home. It’s just simply not true.
December 7th, 2008 at 4:13 pm
Jonathryn:
I don’t know where you worked as an editor. But you haven’t read a publishing contract in while. Costco et al are not special sales at any major house. The author gets a full–not a net–royalty. You also misunderstand the nature of advances. Very few advances earn out these days. So the effective royalty on most titles has risen way, way above 15%. And if you’d worked in any major publishing company in recent years you would know that there are not many authors–fiction or non-fiction–who have been “nutured” to bestsellerdom.
No self-appointed management experts drove the industry to bid higher and higher advances on books.
Finally, if advances were based upon the idea that “books don’t write themselves” they would be calculated upon the cost of the writer’s time to produce the book. Advances are determined by an estimate of prospective sales, that’s the fairy tale publishers tell themselves. But advances are really calculated in a competition with other publishers upon the price it will take to outbid one’s competitors.
December 7th, 2008 at 9:40 pm
“I don’t know where you worked as an editor. But you haven’t read a publishing contract in while.”
Wrong. I wrote them, continue to write them, and they haven’t changed a bit.
“Costco et al are not special sales at any major house. The author gets a full–not a net–royalty.”
Just plain wrong. Net versus gross receipts is a different animal altogether. Special sales are accounted for under an entirely different royalty schedule, usually about half of the regular royalty, or whatever the agent can wrangle. There’s a reason big books cost a lot less at Sam’s Club, and there’s a reason they’re not there until after B&N is done with them. The publisher sells them at a discount, and passes the pain along to the author.
“You also misunderstand the nature of advances.”
You clearly don’t know what you’re talking about.
“Very few advances earn out these days.”
Prove it. You simply can’t substantiate that. Open RH’s books.
“So the effective royalty on most titles has risen way, way above 15%.”
There is no “effective royalty.” There is only what the author and publisher negotiate. If the publisher doesn’t sell through, the author doesn’t get another advance, or an advance on poorer terms/less advance.
“And if you’d worked in any major publishing company in recent years you would know that there are not many authors–fiction or non-fiction–who have been “nutured” to bestsellerdom.”
Nice. Try that one out on Bob Loomis.
“No self-appointed management experts drove the industry to bid higher and higher advances on books.”
Any publisher will tell you that books that have the potential to become bestsellers command high prices. If you can’t compete with the big boys, you don’t get those books.
“Finally, if advances were based upon the idea that “books don’t write themselves” they would be calculated upon the cost of the writer’s time to produce the book.”
Fine. Contact me posthaste for your next book length work of approximately 120,000 words. The terms are these: my publisher gets all rights now known or yet to be devised, throughout the universe, in perpetuity, for zero royalties. You are responsible for securing copyright for all necessary materials including artwork, graphs, maps, etc. Furthermore, you have ninety days to complete it or their lawyers will go at you with hammer and tong. If the manuscript is unacceptable, you will make all necessary revisions until it is satisfactory to my tastes, for as long as that takes, and regardless of whether you have (had?) another job. You will be paid twenty-four months after publication, so that we can determine sales less returns, at a rate of three cents a word. (I would pay you ten just for originality, but we’ll obviously have to pay a fact checker to go over the manuscript.)
“Advances are determined by an estimate of prospective sales, that’s the fairy tale publishers tell themselves.”
A lot of very important decisions in many industries are determined by sales forecasts. If the fairy tales weren’t borne out, there would be no publishers.
“But advances are really calculated in a competition with other publishers upon the price it will take to outbid one’s competitors.”
Yes, just like a free market or something. The bigger publishers are also able to pay more because they are better at what they do: sell books. You clearly think authors are pissants that should be squashed. Many publishers agree with you. Don’t worry! They’re usually doing a good job at that. Thanks for the dialogue, and I sinceerely look forward to becoming your next editor.
December 7th, 2008 at 10:56 pm
Jonathryn:
Ok, now you’re just coming off the rails. The books sold at Costco are not sold through the special sales department in any major publishing house. They used to be sold through a wholesaler called AMS, they now buy direct and through some other wholesalers but on the same discount as the bookstores. They can only buy them as a special sale if they’re taking them non-returnable. If you write the contracts, as you boast, you know that. Or call your sales department. They’ll tell you.
More to the point, the books at Costco are there at the same time they’re in any bookstore.
You can tell me I don’t know what I’m talking about. But you do misunderstand nearly everything about a book advance. If an author receives $100,000 for a book that sells 10,000 copies (a very common occurrence) then the effective per book royalty rate is 40% of the $25 cover price, not the 15% written in the contract.
Publishers, not “management experts,” drove the price of acquisitions up. You claim that management experts have had a negative impact. (“The book industry also suffers from self-appointed management experts who have no earthly idea what they’re doing.”) That’s just not so. Brian Murray and David Steinberger are the only management consultants running publishing firms. Carolyn Reidy, Susan Peterson Kennedy, John Sargent, Markus Dohle were never “management experts.” I don’t think David Young was ever a consultant but I may be wrong about that. And no publishing house has a management consultant making significant decisions.
Your bizarre rant that begins with “contact me posthaste” doesn’t address the issue that no advance is currently calculated based upon the needs of the author to complete the work. That may have been the origin of advances (and I’m not sure that’s really true) but it doesn’t apply to the publishing industry today. Advances are negotiated in competition or perceived competition with other publishers to establish the “value” of the book.
As a side note, Bob Miller’s response to the New Yorker gets at some of the things we’ve been arguing about here.
“The problem is with everything in between: the books which publishers spend between a hundred thousand and a million dollars to acquire, followed by hundreds of thousands of dollars in marketing and distribution. This is the dangerous middle, the place where substantial bets are made on books with lots of potential but no guarantees. As the costs of publishing in the middle have increased over the past decade while sales only increase at the top, the middle has delivered the biggest losses. And, unfortunately, most of what trade publishers currently publish is in that middle range.”
I would add that the top end has also become a no-win situation with books like The Snowball bringing down Irwyn Applebaum and The Gargoyle playing some role in Steve Rubin’s being relieved of his management responsibilities.
Bob Loomis, and many other editors worked closely with authors for many years. That has almost completely stopped in the last 3-5 years with many prominent authors who worked with their long-time editors switching in search of more upfront money. Tom Wolfe and Richard Ford are just two names off the top of my head. But the most successful books of the past few years in fiction and non-fiction were not “nurtured” by any house. Reagan Arthur bought the first Twilight book after it had been self-published. LB has a large stable of authors built up over a number of years. But their biggest, James Patterson, was bought for a huge sum for the first book. Patterson delivers and that’s one reason LB is very profitable. But even LB has begun to chase the dangerous over-advanced/under-supported books in the search for revenue.
You can’t get around the fact that, with a few exceptions, when the big advances perform, the publisher barely gets out alive. When they fail, they place a huge strain on the house.
Speaking of authors, you’re making assumptions about my viewing authors as pissants (?) You’re wrong about that. Authors have become free agents seeking the best return. That’s as it should be. My view is that authors, oddly, get the raw end of the deal the way publishing is structured now. The most successful authors–those who sell far in excess of their advances–are subsidizing all of those undeserving authors in the middle. By getting paid only 30% of the revenue from their hardcover book sales, they give up too much and get too little in return from their publishers.
That’s why Bob Miller set up his new operation. But I would suggest that his 50/50 deal isn’t attractive enough to get authors to give up the “bird in the hand” of the advance. I’ll have to make that case at length another time and not in response to your comments because you’ll only garble the thought any way.
Finally, this is biggest howler of your comments: “The bigger publishers are also able to pay more because they are better at what they do: sell books.” Big houses pay bigger advances because they have larger financial reserves than smaller houses. But in deploying those financial reserves, they’ve become exactly like the big banks. They’re always chasing size and scale but set themselves up to be caught in a cataclysmic shift in the business plan. That shift is taking place right now. It’s not the economy; book sales are meant to buck the economy. They were once viewed as a safe harbor in bad economic times.
Pressures from other media but also a substantial re-orientation of the sales channel have left publishers saddled with large advances based on very different expectations for generating revenue. In other words, they’re massively leveraged and experiencing a mammoth margin call.
December 9th, 2008 at 7:16 pm
You know, I just realized, you probably never really negotiated a contract beyond the initial advance.