Romance, Historical, Contemporary, Paranormal, Young Adult, Book reviews, industry news, and commentary from a reader's point of view

Update on the Hachette eBook Situation or Retailers Behaving Badly

First, a mini lesson in copyright and distribution.

When authors sell the distribution rights to their book, they are actually selling the right to print, publicize, and sometimes digitally distribute the work in certain geographical territories. The author (via her agent usually) sells the right to publish the work in specific formats; sometimes one publisher may have the print and digital distribution rights but another publisher the audio and sometimes digital rights are withheld from the publisher. JK Rowling, for example, famously refuses to have her work digitized so the pirates do it for her. Recently John Grisham agreed to have his works be available for sale in digital format.

So essentially an author has these bundles of rights. She, via her agent, gives these rights to someone else (a publisher) in exchange for advances against royalties, usually, but sometimes for a flat rate (like a film deal). These rights can be limited however the author wants including by type of distribution (i.e., audio, digital, print) and by geographical territories (like US or UK or Japan, etc).

What’s this have to do with digital booksellers?

In this international, internet marketplace, the burden is on the booksellers or retailers to honor the agreements between the authors and publishers by not selling books to customers outside the appropriate geographic/territorial regions. This is why to buy a Kindle e-book, you have to have a credit card with a US address. That is one way that a retailer can correctly police the rights agreements that publishers have with authors.

Problems arise when an etailer sells books to many different geographical territories with books subject to different agreements. For instance, Harlequin often buys world rights to its books (maybe it does all the time, I’m unsure). So a bookstore that sells Harlequin books would need technology to indicate where the payor is located. You can imagine that it becomes even more complicated if you have author A with sold rights to five regions and author B with sold rights to 8 regions and author C having sold rights to only one region.

What went wrong?

Some online retailers were not honoring that position and thus HBG took action to suspend the distribution of books until retailers could appropriately restrict access to those customers within the appropriate geographical region.

HBG is currently working with retailers and providing distribution access once the retailers work out the rights issue. Because some retailers didn’t initially honor those contractual territorial agreements, it seems like consumers are getting something taken away from them when it really shouldn’t have been provided (pursuant to the contract between the author and publisher) in the first place.

What can a reader do to effect some change?

While the resulting adverse customer action isn’t the fault of HBG, it is telling about the growing pains the publishing industry is suffering. Authors must sell world rights to their books in order for all readers, internationally, to have access. My suggestion is for international readers to email the author to express their desire for access to those books because it is the author who owns the rights to her book and it is she who must sell them in order for them to be legitimately available to you.

Hope that explains what is going on.

Jane Litte is the founder of Dear Author, a lawyer, and a lover of pencil skirts. She spends her downtime reading romances and writing about them. Her TBR pile is much larger than the one shown in the picture and not as pretty. You can reach Jane by email at jane @ dearauthor dot com

29 Comments

  1. K. A. Laity
    Jan 22, 2009 @ 11:01:23

    I think this outmoded way of thinking in terms of geographical regions has to go. The web has allowed us to cross those boundaries easily, and people will do it illegally if they can’t do it legally.

    Cory Doctorow has a good piece on this and his career — providing free downloads of EVERYTHING he writes — show that it can succeed:

    http://www.locusmag.com/Features/2008/05/cory-doctorow-think-like-dandelion.html

    As a writer, I believe in getting paid, but I think we have to face up to some realities about the digital world, too. I find it ridiculous to have all these different region codes for DVDs which only mean that I had to get a region-free player. There will always be a technological work-around. Let’s focus instead on how to use technology to make people fans. It can work.

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  2. ilona andrews
    Jan 22, 2009 @ 11:41:57

    Most authors, especially midlist authors with small to average advances, don’t “sit” on their rights. We want to sell them, because it’s money for a work already accomplished.

    Publishers don’t always wish to purchase world rights. When they do, the author earns only 30-40% cut on the foreign sales, because both the agents and the publishing house takes a cut. When publisher does purchase those rights, it is the publisher’s responsibility to market the book to foreign publishers and the author really can’t do that much about the progress of this situation. So selling world rights to publisher might not actually result in getting the book quicker to foreign venues, it may actually slow the process down in some cases.

    When the publisher doesn’t purchase world rights, the rights must then be individually sold. In effect, they are offered for sale and the author and agent market them to foreign publishing house and hope they bid. As I pointed out, a midlist author’s advance often ranges under 20K per book and selling foreign rights at 5K is a huge raise for us. We want to sell the rights, but sometimes nobody bids.

    For example, I personally missed the window for a UK sale, because UK publishing house prefer to release British version of the books simultaneously or shortly after US release. Would I have sold them? Yes. Given an offer, I would have. Take it, take it, take it!

    So emailing a bunch of frustrated midlist authors and fussing at them over not selling the rights actually might not accomplish anything except frustrate said authors. Here they are desperately trying to sell the damn things and now even the readers are angry because we can’t.

    If you are a reader who would like to see your favorite foreign author’s work released, there are avenues to make yourself heard. It’s a supply and demand formula: if you demonstrate demand for the book, publishers might listen.

    Email the publisher who publishes authors similar to the one you would like to see in print. Talk about that author’s work on book club forums, even on your own version of Amazon. Show that you will buy the book if it were to be released and someone might listen and sell it to you. Or they might not. In publishing, sadly, there are no guarantees.

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  3. Teddypig
    Jan 22, 2009 @ 12:09:00

    I have yet to see anyone go to someone’s house and take away the book they bought on Amazon.uk because the author sold no us rights.

    In fact I buy books from Amazon.uk all the time that are not available here.

    I am starting to think the consumers need to start seeking protections.

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  4. ShellBell
    Jan 22, 2009 @ 12:57:24

    I buy eBooks for several reasons – convenience at having one device that can contain my 1000+ ebooks, saving on bookcase space, being able to download ebooks as soon as they are available and cost. With eBooks my book budget has increased and the range of authors that I read has expanded considerably.

    When I register with any of the epublisher/ebook retailers my address and email address quite clearly state that I live in New Zealand. Quite simply put, if I can’t buy directly from the UK or US sites there is only one option and that is Dymocks in Australia. For me Dymocks have a very limited range of eBooks and the price is more expensive than buying from the UK or US. If I can’t buy directly from the US/UK sites, then I won’t be buying very many books at all. I have no intention of going back to books in print – not all of the authors I read have books available in print format, print books are far too expensive in a small market like New Zealand and I just don’t have the space on my bookcase for all of the books I want to read.

    I could cope if there was a delay in my being able to buy the eBooks due to my geographical location, but absolutely nothing is going to force me back to print format. The publishers will merely lose sales from me as I will utilise the library more often and only buy from sites that allow me to purchase eBooks from them, which will limit my purchases.

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  5. Jane
    Jan 22, 2009 @ 13:35:10

    @ilona andrews I understand your position that authors want to sell their world rights but I think that is ultimately the catch here. My understanding is that publishers want the broadest rights possible but that agents routinely ask that the world rights clause be taken off the table. Publishers want the world rights but don’t want to pay extra for it. Authors want to sell world rights and want to be paid some amount for them.

    Agents (and therefore authors) want to make some money on it at a later date. If, because the window of opportunity closes for an author, she has taken that chance, hasn’t she, by wanting to get something for those world rights instead of just handing them over with the bundle of other rights at the time of the initial contract? That seems like a risk that the author bears. I don’t know of any publisher who, when offered world rights, wouldn’t take them. Harlequin, I believe, has a non negotiable world rights clause in its contracts.

    I think its onerous to ask readers to determine exactly which publishers in their country would be amenable to publishing your book. The fact is that with digital rights, the existing US publisher could easily make that content available (as can be seen by the current mess) in digital format if they had the permission from the author.

    So fussing at authors, as you call it, seems to be a reasonable way for readers to express their desire for more books. It seems like it would be much easier for the author to gather the emails of a number of readers and send it off to the agent who is in charge of selling those foreign rights rather than asking the readers to start up conversations hither and yon and find out the publishers.

    Ultimately, what happens is that because there is a lack of legitimate sources, readers turn to non legitimate sources.

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  6. Estara
    Jan 22, 2009 @ 13:37:05

    Another aspect: once a book is licensed to a country which does not have the author’s mother tongue as the native language, the publisher there will have it translated.

    My personal problem is that I want to read English language books in English as I have found out that even the best translators into my mother tongue can’t grasp all the inherent nuances that the mother tongue had. I’m sure that I personally – not being a native speaker – also keep missing the finest of print, but at least I am at a stage where when I read clunky German translation I know what the original English saying was and get annoyed.

    Region-coding ought to keep me from reading in my preferred language, ought to keep me from playing games that don’t get translated or viewing film material that is too niche, or whatever.

    I get around this buy buying internationally, owning region-free dvd player and game consoles. My money will keep on going into American or UK pockets until I can get an English-writing author from a German publisher in English.

    At least some of the money goes into Amazon.de pockets, who so far have happily imported UK and US books, cds and videos, but must have some German sales personnel over here ^^.

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  7. XandraG
    Jan 22, 2009 @ 14:57:44

    I suspect this is an area where agents might bring more to the table. Since they regularly negotiate for rights, I wonder if it’s the agents and authors who ought to be proposing new ways of determining e-rights for worldwide accessibility…divorcing e-rights from geographic region and “foreign rights” and instead limiting foreign rights to print distribution and/or language translation.

    But this would be something that authors would have to press their agents for, rather than readers. And that agents and publishing houses would likely have to duke it out over. But it would be worth it. Because as Jane posted above–if your work isn’t digitized and made available by your publisher, then it will be by the pirates.

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  8. Jeaniene Frost
    Jan 22, 2009 @ 15:27:43

    “Authors must sell world rights to their books in order for all readers, internationally, to have access. My suggestion is for international readers to email the author to express their desire for access to those books because it is the author who owns the rights to her book and it is she who must sell them in order for them to be legitimately available to you.”

    If a reader emailed me and said, “I’m from Country X and your e-books aren’t available here, so you should sell world rights,” my response would be, “I HAVE sold world rights, but Country X just hasn’t bought those rights from my publisher.”

    Selling world rights only means an author’s publisher has the right to sell to foreign countries versus the author’s agent. If those countries don’t choose to buy rights to an author’s novels, there’s nothing the author – or their publisher – can do about it.

    I don’t know an author alive who wouldn’t love for their books to be published in every country around the world. But just like authors have no control (aside from wishing really hard) over whether their publisher continues to buy books from them, we also have no control over whether foreign countries buy our books. Market and genre come into play with foreign rights, too. Some genres aren’t as popular in certain countries as they are in the US. So unless you’re a mega-bestselling author, those countries don’t want to buy rights to books in a genre that hasn’t proved to be a moneymaker for them.

    All of my books have been sold in “world rights” to my publisher. Thus far, I’ve been fortunate enough to have four countries buy publication rights on my books, but only for some of my books. Not every foreign country who’s purchased rights has purchased them on every book I’ve written (though again, I’m wishing very hard that this will change). Since my publisher makes 25% off of every foreign rights sale, I know they’ve got a team of dedicated employees trying to sell the hell out of my (and other authors’) books, so it’s not for lack of trying that more countries haven’t purchased rights.

    Also, my publisher owns my digital rights as well. Per their agreement with other territories, some countries can sell the English e-book version without buying foreign rights, but some can’t. I imagine this is similar to what happened with Hatchette, since if Hatchette didn’t own world rights, they wouldn’t care about distributors selling books outside their approved territories, because then it would be costing the authors’ agencies in potential foreign right sales, not Hatchette). So selling world and digital rights still isn’t a guarantee that e-books will be available worldwide, and there’s nothing I, or other authors like me, can do about it.

    I agree that publishing should look to new solutions for this and other issues. Unfortunately, the solution for this issue can’t be resolved just through author’s selling world rights.

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  9. Jules Jones
    Jan 22, 2009 @ 15:28:35

    Note well, I am talking about what I see authors in sf/fantasy saying, not romance — but one of the problems is that publishers are *much* less willing to buy print rights without ebook rights than they are North American rights without world rights. Much, much less willing, as in “dealbreaker”. You get to say “no digital rights” if you’re Rowling, not if you’re mid-list. Not even if you’re a Hugo-winning author who goes into a second printing within a month of release date. So splitting out ebook rights and selling world digital rights separately is Not An Option for most authors, at least not if they want to continue to be published in mass market paperback.

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  10. TerryS
    Jan 22, 2009 @ 15:31:09

    Question – Does the Hatchette situation affect all ebook formats across the board or only certain formats and not others? I read MobiPocket but haven’t seen anything about Secure Ereader.

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  11. Jane
    Jan 22, 2009 @ 15:48:01

    @TerryS I think it affected only the retailers that were violating the agreement and it appears that Fictionwise was not. It sounds like it was one Paris company in particular (the name of the etailer escapes me) that UK publishers were angry with Hachette about.

    @Ms Frost – I get that you want to sell books and I’m not saying that you don’t. I’m also not saying that you aren’t entitled to be compensated for your books or that author’s shouldn’t take calculated business risks. But from a reader’s POV, we don’t really care about those things. Those things are between your publisher and your agent and yourself. We readers care about the end product and how we can easily access the end product. Using the author as an avenue to express a reader’s unhappiness over the lack of access seems eminently reasonable to me, but you as an author are certainly capable of telling the reader that she has other avenues of action she can take to effectuate change.

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  12. Helen Burgess
    Jan 22, 2009 @ 16:14:49

    I was given a Sony ereader for Christmas. I really like it but I cannot buy ebooks from the Sony US store, only Waterstones ebooks (I live in the UK). Now that seems mad to me as I go to the US and buy books and bring them home, I can order books via Amazon and because they are paper, no one can take them away from me or deny me the right to buy them so why the f**k can’t I buy ebooks like that. The publishers would get more money, the authors would get sales, surely that would be the way to go. Not a stupid area restriction, that really restricts trade and profits for everyone.

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  13. Kat
    Jan 22, 2009 @ 16:21:52

    Australia is currently reviewing its parallel importing restrictions on books, and territorial rights is one of the issues being raised to oppose changes to existing legislation. (The counter argument is that this is already happening when Australians buy from online retailers like Amazon. Also, Amazon doesn’t charge Australian GST (sales tax), but that’s another issue.)

    I can understand how territorial rights play out in print books, but it seems unreasonable to expect digital books to be subject to the same restrictions. I suppose it depends on how we treat digital books. Are they just a different physical form of a book compared to print books, or do they belong to a different distribution territory in themselves? If they’re being sold online, I’d argue that we should treat it as a different distribution territory. For example, in journalism, once you sell online rights, it’s pretty much given that there’s no geographic restriction because anyone with Internet access can potentially read your work.

    I know nothing about contract law, but could this be addressed by changing future contracts to remove the geographic restrictions for digital books?

    Also, I understand that authors feel like they have limited power to change the current situation, but I’m interested to know if they have any suggestions for *how* a better system would work.

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  14. Sunita
    Jan 22, 2009 @ 17:11:18

    @Helen Burgess:
    Have you tried WH Smith’s ebookstore? It has a lot of books formatted for the Sony Reader, and they’re 25% off, at least for now.

    Obviously that only helps if the books are being published in the UK, though.

    ETA: And of course your point on how ridiculous the restrictions are still holds!

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  15. LindaR
    Jan 22, 2009 @ 17:17:00

    Why can’t authors “self” publish their published work into markets where the author still owns the rights — since said rights have yet to be sold?

    Make a PDF download available on your website and just sell it directly. Of course, there would have to be a way to confirm the reader’s location — maybe by checking the billable address on the credit card?

    Or is this silly?

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  16. Jeaniene Frost
    Jan 22, 2009 @ 19:16:04

    “But from a reader's POV, we don't really care about those things.”

    I wouldn’t expect readers to. I only went into detail to show that “Authors must sell world rights to their books in order for all readers, internationally, to have access” isn’t necessarily the case. When an author sells world /digital rights, as I did, it’s the publisher who determines what territories are allowed to sell English e-versions of the author’s book, without separate foreign rights being purchased. The author no longer owns their foreign rights; the publisher does. Of course, readers are always welcome to express their unhappiness to authors over the lack of e-book (or paper) availability in their country. It’s just there’s not much an author can do, aside from sympathize and wish the reader’s country would buy foreign rights.

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  17. Mischa
    Jan 22, 2009 @ 19:16:39

    @Jeaniene Frost
    Maybe I’m just dense, but why does country X need to by the rights from your publisher? This isn’t about reprinting the books in another language. The issue here is that internet retailers are not supposed to sell their print or digital books to people living in certain geographical areas because the publisher they bought the book from isn’t allowed to publish in those areas.

    If your publisher already has world rights, why can’t the internet retailers, who already sell your books, sell them to anybody who wants them?

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  18. Jane
    Jan 22, 2009 @ 19:24:11

    @Jeaniene Frost: The predicate action to the sale of your books internationally is the sale of your global rights. In other words, a publisher cannot simply sell your books in digital format to anyone in any country without your initial grant.

    I understand that what happens once you sell your rights is out of your hands, but it always starts with the copyright holder. Readers won’t know that you’ve sold your rights globally unless they ask.

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  19. LindaR
    Jan 22, 2009 @ 19:31:21

    Actually, it looks like the glitch is being caused by the fact that the author has sold the “right to sell the rights” to the publisher — but the publisher has not in some cases (many cases?) gone on to actually sell the rights.

    In the future, maybe agents can work in some kind of fail-safe clause to the author to the effect “if said rights have not been sold by such and such date, the rights revert to the author.” and then the author can sell directly from her own website.

    Win-win, no? The publisher can always come back and buy the rights again from the author if it turns out she’s big in Belgium.

    edit: In other words, if the publisher has failed to perform — i.e., sell the rights — then the author should have recourse.

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  20. Jeaniene Frost
    Jan 22, 2009 @ 19:53:24

    @mischa “If your publisher already has world rights, why can't the internet retailers, who already sell your books, sell them to anybody who wants them?”

    I don’t really know. I had to call my agent today to learn what I outlined above about how world rights don’t necessarily mean every international reader can get an e-copy (and frankly, I”m still confused about the whole “territories” thing). She’s getting more information for me and I will share it once I have it, if you like.

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  21. Mischa
    Jan 22, 2009 @ 21:40:09

    @jeaniene frost
    That would be wonderful. Thanks.

    To my layman’s ears, it all sounds broken. The whole process/logic was created prior to the digital era and becomes nonsensical gibberish when applied to the internet.

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  22. MaryK
    Jan 22, 2009 @ 23:14:36

    it really shouldn't have been provided (pursuant to the contract between the author and publisher) in the first place.

    The books were pulled because some of the authors hadn’t sold their world rights?

    The fact is that with digital rights, the existing US publisher could easily make that content available (as can be seen by the current mess) in digital format if they had the permission from the author.

    So, if a US publisher does own digital world rights, they can sell digital to any consumer in the world? From the other comments, I got the impression that the US publisher has to sell digital rights to a native publisher in another “geographical area” before a digital book can be sold in that area.

    And that sounds whacked.

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  23. Evangeline
    Jan 23, 2009 @ 00:12:12

    @LindaR: I think I suggested this earlier, but my response was probably swallowed.

    So I chime in and say: Yeah, why can’t authors withhold their e-rights from publishers and sell their books in e-form themselves or through an e-publisher they trust? If publishers are sitting on international e-rights–not even touching worldwide print rights–shouldn’t there be a proactive movement for authors to keep them for their own disposal?

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  24. Leah Hultenschmidt
    Jan 23, 2009 @ 11:17:26

    From a publisher’s POV: No one is “sitting” on any foreign rights. Staff is constantly working to sell translation rights to whatever countries we’re allowed to sell to, as specified by the contract with the author. If we don’t have the rights, it’s up to the agent or author to sell them. But as pointed out previously, just like in the States, not every book submitted is going to be bought by a publisher. They have the same constraints we do–even more sometimes because they just don’t have as large of a readership in general (lots more people speak English than German, for example).

    I’m not entirely clear myself on the legalities of buying from Amazon US when something isn’t available elsewhere. I do know that it happens all the time, and I don’t see any way to control that unless Amazon is made aware of rights available and refuses to sell a particular item to certain mailing addresses. But that seems awfully messy.

    Publishers try to get world rights and translation wherever possible. But many agents like to limit the terrorities because authors will get a larger share of money if rights are not sold by the publisher, assuming that rights are indeed sold.

    It does seem as though the best solution would be dividing print terrorities and electronic terrorities. If publishers are granted world electronic rights, the book can be sold globally without worry–and in conjunction with the print release. If a foreign publisher wants to buy the print rights–which quite often doesn’t happen until after a book has been released in the U.S.–digital rights could be sold with it. Presumably, any world distribution done by the publisher electronically would be in English. It would not cut into sales by the foreign publisher who would have the work translated (with the exception of UK and Australia, but again, the digital rights could still be sold as a package deal).

    I’m not sure how effective it is for readers to comment to authors. Whenever I get a letter fowarded by an author from a reader, I send it along to our foreign rights agent. But does it really have any weight with a publisher? Unlikely.

    I agree that the system needs to change to keep up with technology. And it’s definitely time to start thinking about how.

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  25. veinglory
    Jan 23, 2009 @ 11:34:50

    I would think that e-rights are, pragmatically speaking, international rights. Maybe the contracts need to catch up with this.

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  26. Karen Sutherland
    Jan 25, 2009 @ 19:01:38

    Fictionwise were definitely affected by the Hatchette actions. I had several books that I had purchased which were not available to me for quite some time, all were Hatchette imprints on both BooksonBoard and Fictionwise.

    Karen

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  27. Fossil
    Jan 27, 2009 @ 06:10:53

    So I chime in and say: Yeah, why can't authors withhold their e-rights from publishers and sell their books in e-form themselves or through an e-publisher they trust? If publishers are sitting on international e-rights-not even touching worldwide print rights-shouldn't there be a proactive movement for authors to keep them for their own disposal?

    I agree with Evangeline & LindaR. If authors could get a little co-op going selling ebooks direct to the public (by keeping their digital rights), it would be interesting to see how successful they would be.

    I know by browsing this site, I have enlarged my author list enormously… I am sure word of mouth is the best advertising there is.

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  28. Parallel importation of books to Australia (Part 2) - Book Thingo
    Jan 30, 2009 @ 00:03:04

    [...] struggle to keep up until authors and publishers negotiate a more sensible model for distribution. As I commented on Dear Author: it seems unreasonable to expect digital books to be subject to the same restrictions. I suppose it [...]

  29. Ana
    May 05, 2009 @ 18:31:51

    I know that this post is more than 3 months old but I just want to add that writing to the author might help.

    I’m worried that one of my book series that’s coming out will have geographic restrictions so I emailed the author and was glad to find out that if I couldn’t buy it on my usual ebook format, she’d sell it to me directly on a PDF format.

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