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BW Businessworld

Copyright And The Publishing Industry

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Recently there has been a great deal of debate in the media about the proposed amendment to the Indian Copyright Act. The scope of this article is to understand the relevance that copyright has to the business of publishing.

According to Ananth Padmanabhan, Vice-President, Sales, Penguin Books India, "the English language publishing market in India is estimated to be about Rs 7,000 crores or US$1.4 billion with a growth rate of 10per cent per annum.  Of this, it is estimated that book pirates impact nearly 30 per cent of the market. At times, with best sellers by Jeffrey Archer and Dan Brown, the pirated copies could even equal the amount of copies sold by the legitimate publisher."  So, the financial contribution of the rights department to the business of publishing for the firm and the author is not to be sneezed at as it is a significant revenue-generating stream, but it is tough to get figures as no one reveals them. It is possible to gauge the size of the rights market by the volume of business conducted at Frankfurt Book Fair-a trade fair that focuses on the buying and selling of rights. It is safe to say that the volume of business transacted is substantial and exceeds millions of dollars.

According to the WTO, intellectual property rights are "defined as the rights given to people over the creations of their minds. They usually give the creator an exclusive right over the use of his/her creations for a certain period of time. Copyright and rights related to copyright is a part of rights granted to authors of literary and artistic works, and the rights of performers, producers of phonograms and broadcasting organizations. The main purpose of protection of copyright and related rights is to encourage and reward creative work."

If the work is published, then the publisher is bound by the contract signed, to give the author a royalty based upon the total sales. The author transfers or assigns an exclusive license to the publisher the copyright of the work for a fixed time period, which usually coincides with the duration of the publishing contract. This implies that the publisher is authorised to sell "rights" to the author's work, across "territories" and in all formats and they are able to do so with the explicit consent of the author. The copyright term in India is for the lifetime of the author plus sixty years. After the lapse of the copyright period, the work enters the public domain.  

The concept of copyright and protection of an author's rights has been enshrined by the Berne Convention, 1886. As soon as the work is written or recorded, its author is automatically entitled to all copyrights in the work and to any subsidiary rights. All authors are given the same rights and privileges to copyrighted material in any country that signed the Convention. In 1996, the World Intellectual Property Organisation Copyright Treaty was adopted to address the electronic forms of publishing. The core principle of the Berne Convention recognises the author as the key figure to the owner of copyright dispute and not the publisher. Over a period of time, this right has encompassed the moral and the economic right to the work. Till September 2008, there were only 164 countries that were signatories to this Convention.
In the publishing industry, the price of the book is miniscule compared to the total cost involved in producing it that ranges across departments like editorial; legal; rights; design; production; and sales and marketing. Unfortunately, it is impossible to get numbers about the costs per department, as there are thumb rules to decide the distribution of the costs, and the percentages allocated to each department depend upon the strategies of the firm.  As with any business, the common costs of a publishing house has to take into account the possibility of a title not recovering its investment. But there is one definite, reliable and profitable revenue stream for any publisher, which is the buying and selling of rights. This is done by "carving up" the world in territories for which the copyright of a work is bought or sold. For instance, the sale of Vikram Seth in English language territories is managed by different publishers. He is published in Britain by Hachette, in the US by HarperCollins, in Canada by McArthur, and by Penguin in India. Today, he is legally safeguarded by any infringing copy infiltrating any territory, except for a stray copy or two that may have been bought from online sites like Amazon by readers for their personal use. But Vikram Seth is secure in the sales of his books and gets due royalty from all concerned territories. Apart from the sale of books in one language across distinct geographical boundaries, other subsidiary right possibilities include translations, serial rights, extracts, book clubs, audio and other electronic formats, hard back editions, loose sheet sales, and dramatisations including film, theatre and radio. In theory, the long tail of the subsidiary rights could be equally if not more lucrative than a straightforward language/territorial right.  So, a healthy publishing firm will insist on the sale of rights of its successful titles to ensure a steady revenue stream that will help bolster its publishing programme. This interdependence between different lines of business works well, but it is dependent on the close safeguarding of the territory, which is usually done with the government protection of trade barriers.
Jaya Bhattacharji Rose is currently working as an independent publishing and editorial consultant. Associated with Indian publishing since the early 1990s, she produced the first comprehensive report on the Indian Book Market for the Publisher's Association, UK