Is The New Higher Licensing Fee Going Effect The Books and Comics?

[JD]

I just saw over on the thread for the game Resurgence that when David Ellison took over Paramount they jacked up the Trek licensing fee by 2000%, and I was just wondering if this will could have any effect on the books and comics? Could this mean we'll see the prices shoot through the roof, or maybe just less of them? Or could it have some other effect, like different writers who they can pay less or shorter books or something like that?

 

[The Wormhole]

IIRC, I think it was mentioned somewhere in this forum that things should be okay until the current contracts expire. For novel, that'll be 2027 or 28. No idea about comics.

 

[Avro Arrow]

I just saw over on the thread for the game Resurgence that when David Ellison took over Paramount they jacked up the Trek licensing fee by 2000%, and I was just wondering if this will could have any effect on the books and comics?

2000%?? Maybe that's how they're planning to get the novels back with their in-house publishing imprint when the current license expires.

But really, who knows what Paramount will choose to do when the time comes for renewal? I'm not sure that any of us have that kind of insight into their thinking?

Could this mean we'll see the prices shoot through the roof, or maybe just less of them?

I doubt they'd be able to raise the price of a book egregiously higher than the going price for a similar-length book, and still sell anything? And we're already only getting only 4 to 5 books per year now, aren't we? I don't have any insider knowledge from the industry, but I would think that if your license fees went up by a significant amount, you might have to release more product in order to cover your increased fees, and still turn a profit?

But if the licensing does go up an extraordinary amount, and S&S feels they can't sell enough to offset the costs, it would probably just be more likely that they don't pursue renewal at all.

@JD , if you're interested, the previous discussion we had regarding this in the other thread (referred to by The Wormhole) starts here.

 

[Admiral_Young]

IDW renewed their license for Star Trek back in 2024. At the time it was not known and still isn't for how long, but since we're getting 60th Anniversary projects for later this year, and probably stuff announced at SDCC for next year, I'm guessing it was at least a 3 year extension so maybe next year we'll hear news about this again.

 

[Therin of Andor]

The last time the license fee was declared "too high" to be profitable was when Marvel/Paramount Comics abruptly dropped several titles, including one ("Early Voyages") in mid story. Lean times ahead again?

 

[Admiral_Young]

I think we're going to see next year if there will be any kind of impact. IDW renewing was a huge deal since they had lost Transformers, and a couple of big other IP's prior to getting Star Trek done. From all accounts folks are mostly happy with Heather Antos' tenue as editor of the line...so only time will tell.

 

[F. King Daniel]

they jacked up the Trek licensing fee by 2000%

Oh it is so fucking over.

People aren't licensing enough stuff and fans aren't buying enough Trek for Paramount's liking at it's current price!

Pakled solutions.

 

[Allyn Gibson]

The last time the license fee was declared "too high" to be profitable was when Marvel/Paramount Comics abruptly dropped several titles, including one ("Early Voyages") in mid story. Lean times ahead again?

Also, the Activision video game license, for which Activision sued to escape.

Oh it is so fucking over.

People aren't licensing enough stuff and fans aren't buying enough Trek for Paramount's liking at it's current price!

Pakled solutions.

I'm of the view that CBS has effectively made Star Trek into a niche property, and putting a high price on licensing will simply further that process.

 

[Brendan Moody]

Worth noting that the 2,000% figure is one licensee describing the increase in their minimum royalty commission, ie the amount they have to pay in royalties independent of whether they actually sell that much product. That may suggest the new ownership is less interested in maintaining smaller licenses and only wants to bother with higher-volume lines. Mass-market comics and novels are probably safer by that metric than a lot of things.

 

[Avro Arrow]

People aren't licensing enough stuff and fans aren't buying enough Trek for Paramount's liking at it's current price!

Pakled solutions.

I get that they’re probably desperate for money, especially with everything going on with the merger and everything. But I don’t understand how it is a sound strategy to raise the licensing to unreasonable levels. They could keep the licensing reasonable, and make a certain amount of extra money on their franchise (probably less than they want, but still), or they can lift the licensing fees into the stratosphere so that nobody can justify licensing anything, and they make… nothing.

it doesn’t seem to make sense to me. Of course, I’m not in the entertainment business, so maybe there’s something I’m missing.

 

[JD]

Yeah, I was thinking pretty much the same thing.

Worth noting that the 2,000% figure is one licensee describing the increase in their minimum royalty commission, ie the amount they have to pay in royalties independent of whether they actually sell that much product. That may suggest the new ownership is less interested in maintaining smaller licenses and only wants to bother with higher-volume lines. Mass-market comics and novels are probably safer by that metric than a lot of things.

Oh OK, so it's not necessarily the same fee for everybody then?

 

[Detached Nacelle]

Worth noting that the 2,000% figure is one licensee describing the increase in their minimum royalty commission, ie the amount they have to pay in royalties independent of whether they actually sell that much product. That may suggest the new ownership is less interested in maintaining smaller licenses and only wants to bother with higher-volume lines. Mass-market comics and novels are probably safer by that metric than a lot of things.

Unless it is part of a push to bring everything in house and no longer license out IPs. To push it by making it so that a game like Resurgence has to be delisted rather than let it remain on sale is a questionable decision, but billionaire's don't like to share their money so unless they're getting 100% of proceeds then they're happy to burn it down. It is possible that the global removal of all Star Trek from Netflix is also down to this excessive licensing price.

"We'd rather make no money at all than someone else make anything off our franchises"

 

[hbquikcomjamesl]

"We'd rather make no money at all than someone else make anything off our franchises"

I would not say that's characteristic of all billionaires. Just the shamelessly greedy sons of Belial. Which is most of them.

 

[Brendan Moody]

I think people may be substantially overestimating the licensing revenue generated by a lot of these products; a single three-year old video game that got average reviews and gets heavily discounted during storefront sales, for example, is not going to be a cash cow for Paramount.

Yeah, I was thinking pretty much the same thing.

Oh OK, so it's not necessarily the same fee for everybody then?

Every contract is potentially going to be different, but more to the point, the specific kind of fee that seems to have been increased in the instances we know about will have much less impact on a larger license. It’s basically a fee that guarantees Paramount will make a certain amount of money off the license even if the licensed product doesn’t sell at a meaningful volume. For products that are already mass-market, a fee like that is a formality, but for smaller companies that sell a high-quality but very niche product, it can basically shut them out.

It’s certainly possible that all this reflects a policy change that will affect larger licenses as well, but we don’t have evidence of that yet.

 

[hbquikcomjamesl]

I suspect that if this is coupled with a change in the long-standing policy of ignoring fannish merchandise that doesn't compete with licensed merchandise, it could make the dealers' rooms at conventions a lot less interesting.

Says somebody who hasn't attended a convention, much less set foot in a dealers' room, since the days when the Pasadena Convention Center was almost entirely underground, and the Pasadena Grand Ballroom was outfitted as an ice rink.

 

[David cgc]

Oh OK, so it's not necessarily the same fee for everybody then?

Fees are probably negotiated individually, at least for larger licensors, but that's not exactly the issue.

I think it's like a percentage thing. So let's say you make a Star Trek product. Book, art print, model kit, soundtrack CD, whatever. You're supposed to give Paramount 10% of the revenue from each sale, so you sell one book for $10, they get $1. You sell one fine art print for $100, they get $10. The part that went up is that there's a certain baseline royalty they get no matter how much you sell. Let's say that's $1000. So if you're selling books, that means you need to sell 1,000 units to meet your obligation. If you sell more, great, but if you only sell 100, that means you've only given them $10, and need to pay them $90 out of your own pocket. If you're selling art prints, that means you need to sell just 100 units, but it's a more expensive specialty product, so you aren't going to sell as many as you are books, but if the minimum royalty is low enough, that doesn't matter.

Imagine Star Trek books move 10,000 copies (so Paramount gets $10,000), but Star Trek art prints only move 200 units (Paramount getting $2,000). That's fine, both cover the minimum licensing fee. But now Paramount has decided they want to make Star Trek licensing a little more exclusive, for whatever reason, so they've increased the minimum royalty to $5,000. That's still below what Star Trek books get them as a matter of course, so there's no change in practice for them, but that's more than double what the person making the art prints was paying. So they need to make up the difference out of pocket, figure out a way to increase production/sales to meet the new minimum, or drop the license.

 

[JD]

Oh, OK. I thought it was just a straight flat fee that everyone paid to make Star Trek products, and then whatever cut Paramount got was a totally separate issue.

 

[BillJ]

Oh it is so fucking over.

People aren't licensing enough stuff and fans aren't buying enough Trek for Paramount's liking at it's current price!

Pakled solutions.

Donald Trump School of Economics.

 

[Therin of Andor]

Oh, OK. I thought it was just a straight flat fee that everyone paid to make Star Trek products, and then whatever cut Paramount got was a totally separate issue.

When DC Comics lost out to Malibu of the first DS9 comics license, it was because Wildstorm got outbid. Later, when DC/WildStorm lost out to Marvel/Paramount, it was because DC/Wildstorm got outbid.

 

[Allyn Gibson]

When DC Comics lost out to Malibu of the first DS9 comics license, it was because Wildstorm got outbid.

DC didn't buy Wildstorm until 1998. Wildstorm had nothing to do with Malibu getting the DS9 license in 1993.