When the news breaks that a publisher has paid a huge advance for a new or emerging author, it sends a message to the industry. It signifies that – despite excruciating pressures on retail and variable results for debut fiction in particular – publishers still believe that they know how to make and find great success for authors and for themselves.

Publishing is an unpredictable business but publishers and agents take pleasure in being alert to the opportunities that come from talent, from luck and great timing: every high six- or seven-figure deal signifies that someone has played the game of strategy and skill well and won big – and that at least one publisher is willing to gamble on success with very high stakes. And this is surely good news for all authors. Without publishers’ belief in their own ability to build and predict bestselling success, where would any talented author be?

But paired with the sweetness of the handful of buzzed-about acquisitions is authors’ and agents’ knowledge that these deals are part of a larger gamble into which publishers have necessarily incorporated the potential for failure and for write-offs. As stated already, success can be unpredictable. And many of the biggest auctions are held for books that actually don’t go on to sell in the sort of huge numbers that justify a high six- or seven-figure advance. So how can publishers continue to go with their guts and gamble so big?

Many authors already realise that publishers can afford to gamble because they are making hundreds and thousands of bets every year that pay off for them much more reliably and profitably than do the huge book-fair deals. Midlist authors earn out their advances over the long term and their profit share comes in the form of royalties. Most debut authors are paid low advances. In other words, most authors are paid in royalties, not in the form of unearnable advances, and the downward pressure on their royalties is inexorable and real.

It’s not only authors of lower-selling books who are taking a smallish slice of the pie, but some of our most successful authors too. Our ever-narrowing market means that there are fewer bestselling books, each one selling more copies. Those mega-bestsellers are not usually the books that were acquired for mega-advances, although some were paid for with substantial sums. Even so, they have all exceeded expectations. Some have exceeded expectations by large margins, some by vast ones. The authors of the mega-selling break-out books are also living on royalties, not advances.

As an agent I want my authors to earn good advances too. In the case of gambles, I want publishers to believe, at the moment of acquiring my authors’ books, that these are the books that can and should become the mega-sellers of tomorrow. Publishers’ conviction fires their creativity and investment, and feeds enthusiasm in everyone to whom they market their books.

But I also aspire to negotiate big advances because I am not convinced that standard royalties alone – in this era of high discounts (print), net receipts (digital) and subscription platforms (audio) – any longer offer authors a fair share of a publisher’s profits. Like other agents for brand-name authors, I would argue that authors with reliable audiences – whose sales can cover a predictable portion of a publisher’s overhead –  have every reason to expect a higher share of their publisher’s profits  than a royalty alone can offer them. And the best way to guarantee my clients a greater share of the profits is to negotiate advances that won’t earn out.

So much for established authors. But, as someone interested in the economics of publishing for all authors, would I give up the chance to negotiate a seven-figure advance for one book by a new or unproven author in exchange for a significantly higher and escalating royalty from copy #1 for all my authors? Yes, I would.

One of the problems with the game of risk publishers and agents play with advances is the way it tilts the market towards debut (unquantified potential) and away from books written by not-yet-bestselling talented authors deeper into their careers. It isn’t logical or commercially defensible that an author’s sales track record demolishes their chance of a good advance for their next book. And, although I love to pitch books, I don’t want to have to fire a publisher’s imagination or hope for a trick of the light or of good timing in order to secure a fairer deal for my authors. I resent the time spent persuading publishers to pay new authors, smaller authors and midlist authors a decent share of export sales or a separate advance for audio rights. Anyway, I know that mega-bestsellers have a habit of surprising us all, as market leaders should. Everyone needs to be contracted on a great royalty. Most importantly, I know that my literary agency’s profits – a fair reflection of all authors’ profits as a cohort – rely more heavily on fair royalties than on one-off unearned advances. I want all authors to be paid well, and for us all to gamble together. I love the game, but I want us to play on the same side. We need our publishers to be profitable, but all authors deserve generous rewards in exchange for taking the incomparable risk of writing a book.

First published in Publisher’s Weekly / BookBrunch. Also published in the March 2019 issue of the Society of Authors’ quarterly journal, The Author.