Is this where traditional publishers are going with their contracts?
The short answer: Not necessarily, but if authors and readers don’t raise hell about it, it becomes more likely.
The slightly longer answer: Look, what Random House is doing with their Alibi and Hydra imprints (and presumably their Flirt and Loveswept imprints are well) what the raptors inJurassic Park did: They’re testing the fences, looking for weaknesses. If they find them, then why wouldn’t they charge through them, to feed on the soft and chewy morsels on the other side (i.e., authors)? And if they can get away with it, why wouldn’t other publishers follow their lead, using the excuse of “this is how the business is these days”?
This is why authors and readers have to keep the fence electrified. Authors have to say, “no, this is bullshit” and refuse to deal with imprints offering these sorts of terms, and they have to tell other authors — including and especially aspiring ones, who are the most vulnerable to crap like this — that it’s bullshit, and explain why. And they have to explain to readers why this is bullshit too. Because readers are fans of authors and they’re sensitive to the people whose work they like being exploited.
Read more at Raptors at the Fences – Whatever.