Below is the full text of Dorchester Publishing’s information release to authors and agents July 22, 2011

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WHAT’S HAPPENING AT DORCHESTER?

Dear Author, Agent or Publishing Colleague:

It’s been a crazy but productive year for Dorchester Publishing, like it has been for the entire publishing industry. After the cessation of our mass market paperback program last August, there were a number of other major changes to occur, including the naming of new CEO Robert Anthony, the appointment of a new accounting staff (Loretta Folk, controller, and Brian Chinn, royalties accountant) and serious strides into both trade paperback and electronic publishing. In case you haven’t been watching with baited breath, we would like to take a moment to bring you up to date on factors or developments that may directly affect you, your titles, and earnings both past and future.

Our top priority remains bringing royalty payments up to date. The lifeblood of any publisher is its authors, so our focus is first on those writers still active in our publishing programs—though we are confident that slowly but surely we will make good on all debts caused by our former administrative difficulties. We are again sending out accurate statements as a matter of course. As stability returns, Dorchester can refocus on its original purpose: discovering and growing new talent in all forms of genre fiction.

Our dynamic Trade publishing program began in January through the distribution arm of Ingram Publisher Services. The program contains titles culled both from our back list and original content, and it will take advantage of advanced technology to provide much more accurately targeted distributions. Early 2011 boasted several successful new releases, including Leanna Renee Hieber’s Perilous Prophecy of Guard and Goddess, the third book in her critically acclaimed Strangely Beautiful series, and The Bonaparte Secret, the newest Lang Reilly thriller by Gregg Loomis. Readers were wowed by movie tie-in editions for The Woman, a spine-tingler by Jack Ketchum and Lucky McKee that took bookstores and Sundance by storm, and House of the Rising Sun by upstart Chuck Hustmyre is set to win him readers for life. Yet to come is The Unforgiven, the first of New York Times Bestselling Author Joy Nash’s Watchers series, and offerings from Gord Rollo, John Everson, and L. J. McDonald. Sorceress, Interrupted, the continuation of A. J. Menden’s super hero series (Elite Hands of Justice) was highly anticipated, and S. Craig Zahler’s brilliant new Western, A Congregation of Jackals, has already been tapped for several national awards. Working with Ingram, we have produced around 50 books in trade format, and another 60-70 should be available by year’s end. The program is only growing.

At the same time as we increase our trade presence, we continue to work on making our authors’ backlists available to their entire readership, including those readers caught up in this year’s fantastic electronic publishing boom. Renee Yewdaev, Dorchester’s head of production, is converting backlist to e-book format in a systematic fashion that assures both speed and quality, and which allows titles to retain recognizable branding established in their original print format. After redeploying several persons in-house to focus on this conversion push, we anticipate having several hundred additional titles in e-book format by the end of the year.

After the changeover from LibreDigital to a partnership with Ingram’s Lightning Source books, our electronic distribution channels have smoothed out. We continue to aggressively market through Amazon, Barnes & Noble, Baker & Taylor, Indigo (Canada), Borders, Sony, and a number of other well recognized e-book vendors, and we are pleased to announce that we have just signed direct agreements with Apple and Google to further expand the number of platforms and consumers our product can reach.

Our website, www.dorchesterpub.com, has been redesigned and now sells both trade and e-book titles.

Dorchester is confident in our new programs, and we recognize that the publishing landscape is changing. For that reason, a project was embarked upon to update royalties to new industry standards. An amendment was created for all interested authors with existing contracts. In addition to firming up some other, the amendment will:

a) Raise any lower rate on trade royalties to 7 1/2% of cover price

b) Raise the royalties on e-books to 25-35% of net sales

c) Increase the frequency of royalty reports and payments to every 6 months.

Any author who has not received an amendment should contact either their literary agent and/or Samantha Hazell at shazell@dorchesterpub.com. Specific questions can be directed to Dorchester’s editorial director, Christopher Keeslar, or to Tim DeYoung, VP, Sales & Marketing.

2011 has seen a number of ups and downs, but the future seems brighter every day. This will be a decade where authors are more powerful than ever before, especially those authors who have the resources and connections to take advantage of the industry’s new opportunities. We look forward to partnering with those authors. And while rebuilding is a slow process, we plan to shine in genre fiction for many years to come. We eagerly anticipate your thoughts and feedback.

Expressing its determination to turn over a new leaf after its 2010 annus horribilis, Dorchester Publishing has announced a wide range of improved royalties, practices and policies, and has issued an amendment to put its money where its mouth is.

In a newsletter sent to Dorchester authors and agents the company described the course set by CEO Robert Anthony and his financial and editorial team.  Among the highlights are: bringing royalties up to date, improved e-book and trade paperback royalties, shift from mass market to print on demand trade paperbacks, more responsive royalty accounting including a clear statement of reserves against returns, and provisions for recovering rights in the event of Dorchester’s failure to report and pay royalties on a timely basis.

For the summary statement click here, and for the actual terms of the amendment, click here.

Anthony and his staff have expressed their determination to create a streamlined new company responsive to conditions of the 21st century. We hope this is the beginning of a turnaround for an excellent genre publisher that, like every other publisher today, is reinventing itself in the Digital Era.

Richard Curtis

Last November Dorchester CEO Robert Anthony presented a turnaround plan for the floundering publishing company he had recently taken over. (See New Dorchester CEO Vows Strong Comeback). The plan was built around stepping up its e-book initiative and instituting a suite of measures to put the firm on a sound financial footing.

Since then Dorchester has restructured its organization, trimmed personnel, converted its backlist to digital formats, and announced the imminent shedding of its unprofitable magazine holdings.  These changes have occasioned an invitation by Anthony to the company’s creditors to attend a meeting updating them on progress.

Here in essence is what they will hear him say: “We have changed management, continued to aggressively cut costs and are converting our production capacity to respond to the digital revolution affecting our industry. As a result of these efforts we are beginning to experience growth in e-book revenues. Maintaining a limited trade book program has also been important, keeping our authors featured in retail stores across the country.”

As we said in November, we welcome this news and speak, I’m sure, for an author and agent community that wants to see Dorchester’s turnaround succeed and wishes it and its leader every success.

The full press release may be read here.

Richard Curtis

After Dorchester Publishing came close to the rocks a few months ago the Mystery Writers of America delisted it from its roster of markets approved for submission by MWA members. That also meant that Dorchester titles would no longer be eligible for Edgar® Award consideration nor would its authors be eligible for Active Status membership for any books published after October 6, 2010. The board made it clear to Dorchester that it is welcome to re-apply once these problems have been cleared up.

The company’s CEO left and things were looking fairly bleak. However, the new CEO, Robert Anthony, has been working hard and visibly to rehabilitate the company and its reputation. (See New Dorchester CEO Vows Strong Comeback)

That’s the background for this memo from the head of another writers organization. John Scalzi, President of the Science Fiction Writers of America, circulated a memo to its members informing them that SFWA has put Dorchester on probation for a year, placing the publisher on its list of qualified markets for members of the organization. However, “fiction published by Dorchester may not be used to apply for membership until after the probation is completed.”

We’re not aware that Mystery Writers of America has modified its position on Dorchester.

Here’s is the complete release from SFWA Scalzi:

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Dear SFWA members:

As many of you are aware, over the last year, Dorchester Publishing Co, inc, which publishes books by several SFWA members, has been undergoing a number of changes to its business and in how it publishes its authors. The board of SFWA has been following the developments as they’ve occurred, and had asked members with Dorchester contracts to make us aware of if there were any improprieties involving payment or regarding their rights.

In the course of this inquiry, we became aware of several instances in which Dorchester acted against the contractual and legal interest of authors, specifically by not paying royalties when contractually specified, or distributing books in a medium for which it had not legally secured rights.

Dorchester does not dispute these events, and when it became aware of our inquiry, it contacted SFWA to offer us information and background to help answer our questions.

We feel this cooperation has been a positive first step by Dorchester and we look forward to its continuing efforts to rebuild their brand and their business, and to do well by our members and other writers with whom it works. That said, we cannot overlook the troubles the company has had, which have adversely affected our members.

Thus, by vote of the board, Dorchester Publishing is on probation as a qualified Science Fiction and Fantasy Writers of America market for a period of one year, December 10, 2010 – December 10, 2011.

In this case, “probation” means that although Dorchester would remain on our official list of qualified SFWA markets, during the term of probation, fiction published by Dorchester may not be used to apply for membership until after the probation is completed.

If Dorchester successfully completes its one-year probation, fiction contracted during that term will be viewed as acceptable for qualification for SFWA membership. If it does not SFWA will remove it from the list of approved markets.

Fiction contracted and paid for (by initial advance payment) before the term of probation will not be affected by Dorchester’s probationary status.

After a conversation between the Board of Directors and Dorchester, SFWA asked Dorchester to meet a series of benchmarks as a measure of a good faith effort to return to a solid standing. During the period of probation, SFWA expects the following from Dorchester in order for it to remain on the qualifying list after its probation period:

1. That it fulfills its contractual and financial obligations to the authors it has already published, including full and accurate accounting of royalties per contract, with scheduled payment of any royalties outstanding;
2. That it examine its catalog to ensure it is no longer offering fiction in formats for which it has not contracted rights, and makes whole those authors whose rights it has violated;
3. That there are no instances of contractual violations on the part of Dorchester against authors signed to publishing deals after the start of the probationary period;
4. That Dorchester assist those authors wishing to revert rights, consistent with the company’s existing policies regarding rights reversion.

During the probationary period, and depending on member participation, SFWA will be in contact with its members known to have outstanding Dorchester contracts to assure Dorchester is fulfilling its contractual obligations to them, or is actively and affirmatively working to correct previous violations. If you have any concerns during this time, please let the board know by emailing dorchester@sfwa.org or by emailing me directly (president@sfwa.org). Confidentiality is assured for any member who requests it.

While SFWA may act at any time to deal with a member complaint against Dorchester, at or near the six month mark of the probationary period it will perform a formal review of Dorchester’s progress on tasks above, with the results to be provided to the members of SFWA via our normal means of member communication.

Dorchester has pledged to work with SFWA during this probationary period. Dorchester Senior Editor Chris Keeslar has informed us that his company is “working to clean up every mistake that has been made, and we categorically affirm our desire to meet the criteria SFWA lists.”

This pledge from Dorchester to improve its practices and to work with SFWA for the benefit of our members strongly encourages us that writers, our members among them, will soon once again find Dorchester a congenial market for their work.

We look forward to working with them to make it so, and are hopeful that in a year’s time we will be able to retain Dorchester as a SFWA qualifying market.

Yours,
John Scalzi
President, Science Fiction and Fantasy Writers of America

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NOTE: In my original posting I mixed MWA and SFWA up, and I thank SFWA’s Vice President Mary Robinette Kowal for straightening me out. I apologize for my confusion.

Here’s a communication just released by Dorchester Senior Editor Chris Keeslar.
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Dear Authors:

You may have gleaned this information from the previous emailed press release regarding Dorchester’s new CEO, but several exciting changes are happening at the company. In addition to Mr. Robert Anthony’s appointment, the imminent revamping of our Web site and release of Winter 2010 titles, our old printer and warehouse, Offset Paperback Manufacturers, has agreed to once again distribute single-copy sales of our inventory.

What this means to you:

· Your fans will be able to buy your books. All of your mass-market paperback books that were in stock before the August 7 shutdown are back in stock. If you have readers who are interested in purchasing your books, direct them to either www.dorchesterpub.com or to the Telecenter at (800) 481-9191. These books will be accounted for individually and appear on your May royalty statement.

· You’ll be able to set up book signings. Bookstores can once again order your books, provided they are willing to do so on a non-returnable basis. Because of the caveat, depending on the number of copies they are willing to buy, they will be granted a scaling discount. They should call the Telecenter to set up orders. These books will also show up on your May royalty statement.

· You’ll continue to be able to purchase any stock you desire. Special offer author discounts continue to apply, on a sliding scale dependent on volume.

Things you should know:

· If your rights have reverted, Dorchester is still able to sell these books. A caveat of our reversion notice allows for sales of all pre-existing stock. Be assured that we are not going back to press on any of these books in order to sell them at a discount.

· There will be a slightly longer turnaround time on all orders. Allow a day or two longer for shipments, as some changes have taken place at the warehouse that will slow fulfillment.

All in all, though, this is great news. Dorchester looks forward to providing your fans with your books for as long as we have stock and the rights—and we wish you the very best of luck in the continuance of your careers. We hope to be part of them.

Our other current project is generating up-to-date royalty statements and developing a payment plan to see that everyone gets what they are owed in as timely a manner possible. The staff is revitalized and working through each and every problem as it pops up. Any questions, please let me know. I will be out of the office all next week for the holiday, but will be checking my email whenever possible.

Best wishes for a Happy Thanksgiving,

Christopher Keeslar
Senior Editor

FOR IMMEDIATE RELEASE

Dorchester Publishing Names New CEO With an Eye to the Future

NEW YORK, New York (November 16, 2010) – Dorchester Publishing Co., Inc., founded in 1971, and what was until this year the oldest independent mass-market publisher in the U.S., has changed leadership in its mission to revitalize Dorchester and blaze a path as an exciting independent digital and trade publisher of genre fiction.

Taking over the role of Dorchester’s CEO will be Mr. Robert Anthony, current CFO & COO of Backe Digital Brand Marketing, who brings with him more than 25 years of experience in financial and operations management. Prior to his time at Backe Marketing, Anthony was the president of The Blue Sky Financial Group, which provides business consulting services on operational strategies and business development. As a CPA he has worked in public accounting, gaining exposure to a wide variety of business models, and he was the controller for one of the largest investment management organizations in the United States, Federated Investors, where he held an integral role in the planning, restructuring, development and growth of that company.

“My first goal with Dorchester is to reorganize and improve the accounting and internal financial reporting structure. This will include a complete review of the royalty system and other vitally important internal procedures, all of which are intended to focus on shoring up revenue sources and paying off creditors. We will create an atmosphere of transparency and efficiency that was heretofore lacking,” announced Anthony after taking charge on Friday. He is importing new staff to handle the tasks, though Dorchester’s remaining core will go unchanged.

Dorchester is known for having built such stars as Christine Feehan, Katie MacAlister, Connie Mason, Lynsay Sands, and numerous others, and its authors have been bestsellers of The New York Times, USA Today, Barnes & Noble, and many more. Earlier this year, Dorchester changed its focus from mass-market paperbacks to e-books and trade paperbacks. While the trade line was planned for some time, the mid-August shift to e-books was predicated by financial difficulties stemming from the contracting mass-market industry and came with a significant reduction in Dorchester’s staff, which caused some missteps in the implementation of the new company strategy. Mixed messages to media outlets and unpredicted procedural changes also contributed, undermining author confidence and leading to rumors of imminent bankruptcy.

“We are going to reinvigorate this company,” declared Anthony. “I’ve quickly learned that the employees at Dorchester are a talented and professional group. We’re going to do whatever it takes.”

Some steps have already been taken: After a deal with Offset Paperback Manufacturers, previously unavailable mass-market copies of Dorchester’s author backlist are once again available to some vendors and through the company website —www.dorchesterpub.com— and after a short hiatus in new-book production, the company intends to release its Winter e-book list on November 23, 2010, just in time for the holiday season. An arrangement has been reached so that Ingram will be distributing Audio Realms audio versions of popular Dorchester books as well as the trade releases, and the company’s Web site will be revamped and launched right before the end of the year. Writers groups such as SFWA, RWA and MWA are being contacted to help spread news of the changes.

Contrary to mistaken previous reports, Dorchester intends to produce all titles in both e-book and trade paperback form, using both Ingram’s regular trade printing ability or advanced inventory technology as orders dictate. The trade paperbacks will begin appearing in January 2011 and be distributed through Ingram Publishing Services, who will sell Dorchester’s product into standard retail outlets such as Barnes & Noble, Borders, Waldenbooks, BooksAMillion, Powell’s, Wal-Mart, Target and K-Mart, among others. A recent changeover from LibreDigital to Core Source, Ingram’s digital warehousing and e-book sales arm, will also facilitate forward growth and the expedited availability of popular authors’ backlists in e-book form.

It’s always darkest before the dawn. Just when the prospects for recovery seemed bleakest, Dorchester has come roaring back onto the publishing scene with a determined new CEO and a turnaround plan that wastes no time in restoring the confidence of authors, agents and retail partners.

Here are the highlights of Dorchester’s just-issued press release:

The new CEO is Robert Anthony, an experienced executive in digital brand marketing, with “more than 25 years of experience in financial and operations management.”

Anthony’s first goal: “To reorganize and improve the accounting and internal financial reporting structure. This will include a complete review of the royalty system and other vitally important internal procedures, all of which are intended to focus on shoring up revenue sources and paying off creditors. We will create an atmosphere of transparency and efficiency that was heretofore lacking,”

Clarification of previously announced strategy. Anthony stated that “previously unavailable mass-market copies of Dorchester’s author backlist are once again available to some vendors and through the company website.”

Hit the ground running: “After a short hiatus in new-book production, the company intends to release its Winter e-book list on November 23, 2010, just in time for the holiday season.”

Apology for mixed messages: “Mixed messages to media outlets and unpredicted procedural changes also contributed, undermining author confidence and leading to rumors of imminent bankruptcy.”

Determination to be a player: “We are going to reinvigorate this company,” declared Anthony. “I’ve quickly learned that the employees at Dorchester are a talented and professional group. We’re going to do whatever it takes.”

We welcome this news and speak, I’m sure, for an author and agent community that wants to see Dorchester’s turnaround succeed and wishes it and its new leader every success.

The full press release may be read here.
Richard Curtis

We recent wrote up Dorchester Books’ woes and the strategy it announced to deal with them (see The Incredible Shrinking Publisher).

Today the National Board of Directors of the Mystery Writers of America removed Dorchester from its list of Approved Publishers. This is not the first time MWA has taken this position.  In December of 2009 it took exception to a Harlequin initiative and delisted it, too.

Following is MWA’s memo to its members concerning Dorchester:

Richard Curtis

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Dear MWA Member:

The National Board of Mystery Writers of America voted unanimously on October 6, 2010 to remove Dorchester Publishing from our list of Approved Publishers, effective immediately, primarily because the company no longer meets two of our key criteria.

First, the initial print run by the publisher for a book-length work of fiction or nonfiction must be at least 500 copies and must be widely available in brick-and-mortar stores (not “special order” titles). In other words, print-on-demand publishers and Internet-only publishers do not qualify.

Second, the publisher must not wrongfully withhold or delay royalty payments to authors. We have been hearing an unusually high number of reports from our members of unpaid advances and withheld royalties on their Dorchester books.

Dorchester titles will no longer be eligible for Edgar® Award consideration nor will its authors be eligible for Active Status membership for any books published after October 6, 2010. The board made it clear to Dorchester that it is welcome to re-apply once these problems have been cleared up.

This e-bulletin is being sent on behalf of MWA’s National Board of Directors.

Question: What’s the difference between Dorchester Books and E-Reads?

Answer: None, now.

We reached this conclusion after Jim Milliot of Publishers Weekly broke the news that “Mass market romance publisher Dorchester Publishing has dropped its traditional print publishing business in favor of an e-book/print-on-demand model effective with its September titles that are ‘shipping’ now.” Dorchester, an excellent but undercapitalized publisher of mass market paperbacks in such popular genres as romance, horror, thrillers and westerns had been struggling for some time as returns hammered it relentlessly and digital books ate further into its margins.  Milliot reports that the editorial team will remain intact but in all likelihood the monthly releases will drop from 30 to 25.

If Dorchester follows its digital decision, monthly releases are not the only thing that’s going to drop. Everything about the company’s operation will shrink if not implode. And yet, oddly, that will not necessarily be a bad thing. In the new paradigm, direct-to-consumer publishing means higher profits because all intermediaries (distributors, bookstores, etc.) are eliminated. E-Reads knows this: we’ve been doing it since 2000.

Although a number of trade and mass market publishers have occasionally experimented with original e-books, Dorchester is the first to take the plunge into pure e-books and no retail bookstore distribution. The mass market format will be dropped in favor of trade sized paperbacks and these will be printed on an on-demand basis. That is, customers interested in buying the print version of a Dorchester title can order a trade paperback on Amazon.com and it will be printed and shipped directly to them.

Dorchester’s move raises the question: how does Dorchester now define itself compared to mass market paperback houses like Kensington or Harlequin?  In truth it is a completely different species. It is however one with which we here at E-Reads are all too familiar: our own.  Since its launch ten years ago E-Reads has been publishing in e-book and print on demand with no bookstore distribution.  We call ourselves a virtual publishing company and welcome Dorchester as a colleague in our space.

Since we have a one decade jump on Dorchester we’re happy to offer a few pages from our playbook to help our new playmate increase its profitability.

The first is to clear out of those expensive Madison Avenue offices and relocate to a smaller and less expensive space. Indeed, you could relocate in rural Vermont and and no one would know, because far more tasks will be outsourced and performed on the Internet. You won’t need all the staff you have now since you’ll be purely online. Now that you’re walking away from the struggle for shelf space you’ll be able to cut down on sales*, marketing and bookkeeping personnel. Your royalty accounting can probably be handled by one person, and, if you’re like us, you can begin issuing royalty statements on a quarterly basis instead of semi-annually as you do now. Why? Because the biggest headache of mass market publishers, returns, will be eliminated. You can also dump your art department and shift it to freelance designers working from clip-art archives.

By the way, what royalty will you be paying? We hope it will be 50% of net receipts, as E-Reads pays.  Gains in efficiency will enable you to double the current mingy 25% being paid by the leviathans of the Old Guard with their fancy midtown real estate – and 50% returns. Even doubling the royalty you should still be able to make a good profit because your operation will be so much leaner and more efficient.

Dorchester’s CEO John Prebich said “We felt like we needed to take some chances and make a bold move.” When the realities of going virtual sink in, Mr. Prebich will find out just how bold the move is. After all those intermediary functions are streamlined, he may not even recognize the brick and mortar publishing company he guided into the 21st century.

* Update: Publishers Lunch reports that Dorchester “laid off its sales staff of seven people.”

Richard Curtis

Every Blogger owes a debt of gratitude to newspapers and magazines. This posting relies on original research and reporting performed by Publishers Weekly.