Bad Contract Alert: ByteDance's Fizzo (Fictum) Reading/Writing App

Posted by Victoria Strauss for Writer Beware®

Over the past year, I've gotten a flood of questions and complaints from writers who've been approached by reading/writing platforms or apps based in Hong Kong or Singapore.

There's a growing number of these platforms, and they are aggressively soliciting for content, including on established platforms like Wattpad. While most of the solicitations target writers directly, agents are receiving approaches as well.

Some platforms appear professional, with contracts that are fairly reasonable and straightforward. Others...not so much. Last October, I wrote about the terrible contracts offered by A&D Entertainment and EMP Entertainment, two companies that are deputized to recruit for Webnovel.

A new player in the reading/writing app field is Fictum (domain registered just this past November). Available on Apple and Google Play, it's owned by ByteDance, the parent company of TikTok, and is currently recruiting writers with existing published books, as well as writers willing to produce 200,000 words or more of new material for its Long English Story Project. (UPDATE: Since I published this post, Fictum has re-branded as Fizzo. I've changed all references going forward.)

For new material, Fizzo offers both exclusive and non-exclusive contracts, with different levels of financial remuneration that are rather confusingly described here. You must first publish 30,000 words in order to apply for a contract; once you're contracted, you must fulfill punishing word counts and maintain a grueling schedule in order to earn. For the exclusive contract, for instance, you must publish at least 1,000 words a day in order to receive a "daily update bonus" of $200 per month. More words equal more cash: if you can bang out 100,000 words a month, you get $400. Time is money, though: you can't take more than four days off in a single month, and if you fail to produce for more than four days in a row at any time, you forfeit payment.

I've seen one Fizzo contract, offered for an existing published book. You can view it here. To put it mildly, there are issues of concern.

- The Grant of Rights is non-exclusive and time-limited--but it is also irrevocable. In other words, you aren't stuck forever--but you have no right to cancel.

There was originally a clause allowing the author to terminate for cause, but in the contract I saw, that clause had been blacked out. The deletion wasn't as effective as someone thought, though, because when I converted the contract to PDF, the excised words showed up:

This isn't much better than saying "no, you can never cancel". You'd have to wait a year, and you could only invoke the clause if not a single person had accessed your work in all that time (which might be hard to show, given that Fizzo doesn't have to tell you how your work is performing--see below). Talk about crafting an option so that it practically never happens! Plus, if even if you were unfortunate enough to fulfill the requirements, you'd still be screwed, because you'd have to give money back to Fizzo:

Let me know if you can make sense of that formula.

- You must waive your moral rights. Moral rights include the right of attribution (the right to be identified as the author) and the right of integrity (the right to protect your work from changes that would be prejudicial to the work or to you). If you waive your moral rights, you surrender both. Among other things, this means that your work could be published without your name, or under someone else's name.

Moral rights aren't really recognized in the USA, but they are important in other countries, and the Fizzo app is distributed in multiple nations across the world.

- The initial 2-year term auto-renews (at the publisher's discretion; the author doesn't have a say), but the language isn't clear.

Does this mean auto-renewal for a single 1-year period? Or for successive one-year periods? It's not clear. This is the kind of thing that really needs to be unambiguous.

- There's no fixed payment schedule, payment terms are opaque, and Fizzo doesn't have to give you performance data.

The payment scheme detailed in the contract is different from what's described on the Fizzo website, likely because this contract was offered for a finished book rather than for a serial work not yet written. Collectively called a License Fee, payment consists of a "fixed royalty" (equivalent to an advance); a "contingent royalty" (a KDP Select-style payment based on reading metrics), and a performance-based bonus granted "from time to time".

The fixed royalty (based on word count--around $600 for the book this contract was offered for) is payable 20 days after contract signing or manuscript acceptance, whichever is later. It must be recouped by contingent royalties; once it is, those royalties become payable.

So far, so good. However, the formula for calculating contingent royalties is not exactly transparent:

Nowhere is it explained what's meant by "effective reading time", or "unit rate", or how either one is calculated, except to say that it's at the publisher's discretion. Nowhere is there a payment schedule to indicate when and how often contingent royalties are paid once the advance is recouped, other than to vaguely promise, further on in the contract, "commercially reasonable efforts to inform Author...in [Fizzo's] discretion from time to time." (Might this suggest that Fizzo doesn't expect it will have to regularly pay out contingent royalties?)

Equally concerning: nowhere is there any language requiring Fizzo to share performance data, such as how many readers have accessed your work.

Bottom line: beyond the advance, you have absolutely no idea what financial remuneration you might receive, and no guarantee that you'll get any insight into how your work performs on the Fizzo app.

- The grant term is time-limited, but Fizzo's right to use and exploit your work is not. There are two areas where this applies. First, even after the contract ends, your work will continue to be hosted on Fizzo's servers in order to service customers who've downloaded it, which they do on a "perpetual" basis. (This is a common feature of such apps and platforms; it's not so much a "beware" as it is a "be aware".)

Second, Fizzo claims copyright on derivative works created by it in connection with its exploitation of your rights as granted in the contract, and can continue to exploit these derivative works "perpetually". So what exactly is meant by derivative works? The contract doesn't really say.

A previous clause discusses derivative works in the context of promotion, such as creating short video clips based on a work's characters or setting. Other than this, though, "derivative works" is not defined, and the word "including" in the final sentence of the clause above suggests that such works may not be limited to promotional materials.

- Anything you write during the term of the contract is subject to first refusal by Fizzo. Not just work related to the contracted work: anything.

This is an onerous requirement.

- And finally, language like this is never an encouraging sign:

There's a lot of competition out there in the reading app sphere, with dozens of companies vying for content. Most have little or no name recognition. That's not true of ByteDance, which likely gives it a substantial recruitment advantage.

That's unfortunate, not just because of the unfavorable contract terms discussed above, but because the writers being approached by the apps, many of whom are teenagers or college students, are among the most naive and least savvy I've ever encountered (at least, judging by the many questions and panicked "I signed up without reading the contract, how can I get free" pleas I'm receiving). Considering how long I've been doing the Writer Beware thing, that is saying something.

UPDATE 12/23/21: I've just seen another non-exclusive contract from Fizzo (this one follows its re-brand with the new name).

It still includes most of the problems I've identified above, and remains significantly author-unfriendly. But there are some changes, which I've outlined below. A couple of these are improvements. Most...are not.

This contract too was for a completed work.

- The contract term has been extended. ;It's now 5 years instead of 2, with the same ambiguous renewal language.

- There is still no right of author termination. 

- Provisions have been added for termination by Fizzo. There's now a 7-day "termination period" during which Fizzo can continue to exploit all granted rights...but does not have to pay for such exploitation. And if termination is due to breach by the author, Fizzo "is entitled to demand a refund of paid License Fee." (Financially penalizing authors for contract termination is a common feature of reading app contracts.)

- The payment provisions--collectively known as the License Fee--have been re-worked. There's no Fixed Royalty. Instead, there are two new categories: "Gratis Basis" (the work is free to read on Fizzo's distribution platforms) and "Non-Gratis Basis" (the work is pay-per-view or something equivalent).

For Gratis Basis, payment is the same confusing Contingent Royalty discussed above. For Non-Gratis basis, payment is 40% of Net Receipts--but Net Receipts in this instance actually means net profits, because there is a menu of deductions:

That's...a big list. Your work would have to be generating a pretty big chunk of change on a regular basis for any revenue to survive all those deductions.

It's rare to see such detail in a net profit royalty contract, and sheds light on why net profit royalties are great for publishers but lousy for authors.

- The Option clause discussed above, which obliged writers to give Fizzo first refusal on any additional works created during the agreement term, has been removed.

- A payment schedule has been added. Payment is now said to be "no later than the last day of the calendar month that is subsequent to the month during which the License Fee becomes payable or is accrued." Fizzo still doesn't have to give you performance data, though.

- A gag clause has been added. It's buried in the Promotional Activities section, and forbids the author to "in any way denigrate or derogate Publisher, its affiliates, assigns and successors, and any of its and their officers, directors, employees, agents and advisors, or any product or service or procedure of any such person". The applies "whether or not such denigrating or derogatory statements shall be true". This covers a very large amount of ground, and could significantly affect authors' ability to speak truthfully about their experiences.