MICHAEL HEYWARD ON A THRIVING LITERARY CULTURE
COPYRIGHT tells the whole story of our thriving literary culture. Without it there would be no recognisable book trade, royalties for writers or investment in the skills of publishing: editorial, rights, design, production, marketing, publicity.
Copyright, licensed territorially, allows writers to authorise editions by country or language. It allows booksellers to form a fair marketplace. When you buy a new Australian book in a local edition you are contributing to a high domestic royalty for the writer. The US, Britain and Canada use similar rules to reward writers.
Our rules are cleverer than theirs. If a book is not available here within 30 days of its publication overseas, the bookseller is free to parallel import it, to ignore territorial copyright. This principle of use it or lose it forces publishers to make foreign books available promptly. It guarantees an Australian territory for Australian writers because we publish first. It stops royaltyfree foreign editions of Australian books being dumped here.
The 30-day rule, the subject of an inquiry by the Productivity Commission, is the most efficient and creative territorial regime in the world. It truly balances the demands of commerce and culture, the rights of creators and consumers. Since it was introduced in 1991 our industry has diversified and flourished. We have more authors, more publishers, more booksellers, more books and a greater market share for Australian books.
The rule gives flexibility to booksellers that no bookseller has in Britain, the US or Canada, while giving publishers incentive to invest. Booksellers are free to import any edition at any time on customer request. We are consequently the only English-speaking country with a dynamic and growing independent sector.
This is a marvellous development. Independents have 20 per cent of the market and play an irreplaceable role in the promotion of Australian books, which constitute 60 per cent of all books sold. They are community hubs, the souls of our retail neighbourhoods. They would feel the chill wind of a totally deregulated book market.
Our booksellers are annoyed about the effect of online sales. Readers who use the internet to buy books from a foreign retailer don’t pay GST. Yet a bookseller placing an order with a foreign wholesaler does. Work that out.
The 30-day rule keeps our book printing industry alive. It allows our two main printers — McPherson’s and Griffin Press — to manufacture books that would otherwise be imported. This work earns tens of millions of dollars and creates skilled jobs. It helps keep prices low, which encourages publishers to take risks with new authors. Close to 50 per cent of Griffin’s business is import replacement. Without the 30-day rule one of these printers will almost certainly fail and trigger a domino effect in the book industry.
The rule also allows publishers to champion our writers abroad. Most best-selling writers in this country are published internationally, where some are bestsellers, too. The New York Times just put a whopping seven titles by Australian authors on its annual list of 100 notable books. A secure territory lets us negotiate on an equal basis. At Text Publishing, for instance, we earn more than 20 per cent of our revenue by exporting rights. Two in every three dollars we pay our writers is earned from abroad. This money buys them writing time. Our company is a net exporter of copyright.
Without territorial copyright you end up with a version of Work Choices for writers, an erosion of their contractual rights in the market. Territorial copyright guarantees a fair go. US editions of books by our writers often change hundreds of words: sidewalk for footpath, flipflop for thong, that kind of thing. Do we really want our children reading these editions?
Labor has endorsed the present regime since the Hawke-Keating government implemented it. Its national platform supports copyright. When the Howard government wanted unqualified deregulation of books a few years ago, Labor was opposed: Kevin Rudd, Julia Gillard, Robert McClelland, Lindsay Tanner and Wayne Swan all voted against the Howard legislation. A key issue is price. Books remain a cheap form of entertainment. A $ 22.95 ( including GST) paperback novel provides hours and hours of intellectual and imaginative reward. It can be read many times, lent to friends and family, and resold. Low prices in a fair market are a good thing. They encourage reading.
During the past decade the Australian dollar, on average, has been worth roughly US69c and 40 British pence. At those rates, excluding GST, many best-selling titles such as Markus Zusak’s The Book Thief ($ 18.14) or The Spare Room by Helen Garner ($ 27.23, we publish it at Text) are cheaper than comparable editions in the US and Britain, or about the same price.
How will abolishing territorial copyright bring down prices, unless we want to become a market distorted by low royalties and dumping?
The Productivity Commission has produced an issues paper that grapples with some of these problems. It asks whether government funding could provide the same benefits as the present rules if we were to abandon territorial copyright. This is a bizarre acknowledgment of a train wreck in the making. The cultural value of books depends in part on the absence of government funding. Free speech in a democracy inheres in a free publishing industry no less than a free media.
Imagine the drain on the taxpayer if territorial copyright were abolished. Total development grants for writers and writing are less than $ 5 million annually. At Text, government assistance is much less than 1 per cent of our revenue, and we are small. Publishing is a $ 1.5 billion industry, bigger than film and recorded music combined. Writers, agents, publishers, printers and many independent booksellers would end up on the public drip.
What kind of policy disables a confident industry so the taxpayer must provide permanent life support? We should recognise the 30-day rule for the success it is and start planning for a future in this industry that builds on the gains we have made.
Meantime, the Productivity Commission has decided to ignore the importation arrangement that really hurts booksellers and publishers. GST-free online sales may be 10 per cent of the total trade. If so, a quarter of imported books evade tax. Why does Amazon have privileges denied to our booksellers who work tirelessly to sell Australian books? Some US states compel Amazon to charge sales tax. The Productivity Commission has put its head in the sand on this issue but it is a big problem. Making the GST rules fair for book importers is a long-overdue reform in the national interest. Michael Heyward is the managing director of Text Publishing.