"This technology which is absolutely wonderful and so forth is potentially going to be a blight on the livelihood of the people it relies on."
- Lawrence Weschler, author and staff writer at the New Yorker

In February of 1996, Harper's Magazine become the first publication to announce that it would share royalties generated in cyberspace with the freelance authors of the accessed articles. The magazine also stated that it would pay freelance authors retroactively across the board for royalties for electronic reuse accrued since January 1994. Harpers' announcement is something of a mutual victory for publishers and writers as they struggle to come to terms over the implications of distributing freelance articles through emerging electronic media. That compensation for commercial reuse of freelance authors' works is a debatable issue at all indicates the turmoil that electronic distribution technologies present to the print publishing industry.

For the last few decades, according to the National Writers Union, it was standard practice for freelance writers to license their articles to publishers for one time print publication in North America, commonly known as First North American Serial rights. This arrangement left ownership of the article in the hands of its author, who was free to relicense it for other uses, or to make additional arrangements with same publisher for secondary uses. The Writers Union says that most freelance authors make less than $7000 annually from their writing, so getting paid for secondary uses is critical. But as electronic storage and retrieval systems have proliferated, publishers are using them to disseminate articles—frequently without paying authors for this reuse of their works.

Although publishing on the Internet is a relatively new and economically ambiguous phenomenon, electronic redistribution of published articles is not—proprietary online databases, CD-ROM databases, and commercial online services, such as America Online, provide direct revenue streams to publishers for their articles—and many of these media have been around for a decade or more.

Harper's began putting magazine articles in proprietary online databases in the early 1980s. Online databases charge users fees to access the full text of an article, thus generating direct revenues to publishers based on usage. Twice a year, Harper's would receive a check from its provider, Information Access Company, along with a one page report. According to Jeanne Dubi, Harper's vice president and general manager, "...[Information Access] would just say this is for royalties. We would have no real way of knowing how many hours we had been accessed...[how] writers were being utilized on their system." Of course, the same is true of print publications; there is no precise way to assess which articles are read by how many people in a printed magazine. But, in light of the new medium, and in the absence of standards, the fact that Information Access didn't provide a per-author breakdown meant that Harper's couldn't be absolutely sure which authors were due what royalties, with the result that authors' royalties went no farther than the publisher for over a decade.

In another shift from traditional practice, many publishers now expect freelance writers to turn over their electronic rights, which currently include making articles available in online and CD-ROM databases, as well as republishing on the Internet or online services such as America Online. Lawrence Weschler, staff writer at the New Yorker and author of Mr. Wilson's Cabinet of Wonder, says publishers tell him they need his electronic rights because, "'It's just too daunting a technological problem to figure out how to pay you for it.'" It is laborious to issue what may be small sums to a large pool of authors on an ongoing basis. Publishers may be legitimately concerned about the level of expense they take on as they venture into new realms of electronic media. But writers groups say that this is the risk of being a publisher. As Weschler points out, the publishers' excuse doesn't wash elsewhere in the economy; try getting away with "It was just too daunting for me to figure out how to pay at the grocery store!"

Writers and writers groups are actively working to devise solutions to turn around the erosion of their livelihoods. The Authors Registry is one such solution. Founded in May 1995 by the Authors Guild, the American Society of Journalists and Authors, and the Association of Authors Representatives, the Authors Registry is a nonprofit centralized author directory that provides publishers with royalty distribution services for electronic and photocopy rights. Like ASCAP, which issues royalties to composers and musicians for commercial replay of their works, the Authors Registry is a mechanism to ensure that authors benefit from the commercial recirculation through electronic media and photocopying, by taking the burden of managing royalty payments off publishers' hands. All a publisher needs to do is send the Authors Registry a single royalty check and a list of who it goes to. The Registry puts the money into its accounting system, which accrues royalties from different publications in authors accounts, and at regular intervals disperses payment to authors with a report. In this early stage of development, the Registry provides its royalty distribution services to publishers for free. Dan Carlinsky, a spokesperson for the Authors Registry, recently told the Legal Times, "What we've done in creating the Registry is to make it doable for publishers who want to do the right thing; and for those who don't, we take away their excuse."

In its short lifespan, the Authors Registry has garnered broad support. Nearly every major writers organization and 100 literary agencies, together representing over 50,000 authors have signed on. Unaffiliated writers can register themselves directly for $10. The Registry has also made progress in getting electronic database providers such as Information Access, UMI, and EBSCO, to develop per-article tracking systems.

Harper's was one of the first publications to turn over its royalties to the Authors Registry for distribution. In fact, Jeanne Dubi credits the Registry with giving Harper's the impetus to resolve their royalty ambiguity problem. "We recognized that we should be doing it, and the Authors Registry put pressure on us to put pressure upon our service providers to try and get some sort of usage tracking. Without the Authors Registry pushing us, we wouldn't have pushed our service providers probably. Everybody won in the end." Harper's now shares electronic royalties 50/50 with freelance writers, as is typical in print publishing for secondary uses. The Nation and Publishers Weekly have also announced that they will pay electronic royalties through the Authors Registry.

In the beginning of August, the Authors Registry sent out $150,000 in royalties to writers. The American Society of Journalists and Authors reports that the payments range from a few dollars to $1500 for photocopy use and electronic publishing. Although copyright abuse continues in electronic publishing, and the $150,000 payments are only the tip of the iceberg of what is owed writers; the Registry's royalty disbursement is welcomed by participating publishers and writers alike. Both sides see the Authors Registry as the beginning of a system that will ensure authors rights to compensation as digital distribution evolves.

It seems likely that royalties will continue to grow. Jeanne Dubi estimates that Harper's will make $30,000 a year at its current level of operation from electronic databases, and that electronic royalties have been growing at a rate of roughly 10-20% over the past several years. Some of that material is public domain, but even so, Dubi expects Harper's will hand over between $10,000-15,000 to the Authors Registry for distribution to roughly 200 authors at current levels. Terry King, Operations Manager of Authors Registry points out, "K-III paid off freelancers for three of its magazines--New York, Automobile, and Seventeen—for just one of the two database deals it had, for the years 1993-1995, paying a total of nearly $30,000. The NY Times predicts, in a Forbes item, revenues of $80 million from Nexis rights over 5 years. We don't know what percentage of that is freelance, but clearly there's real money involved."