In my quest to find out more about how to self-publish my own books, I found this very interesting post which shows the differences between vanity and subsidy publishers and gives any writer who may want to pursue the avenue of self-publishing their own books a good idea of what to look out for in publishing scams.
I have copied a few paragraphs directly from http://www.aeonix.com/vanity.htm in case I get some references wrong:
The following is a discussion of some of the factors in getting published and how "Vanity" or "Subsidy" publishers fit into the picture. These are based on conversations with individuals who have had "bad" experiences with so called vanity or subsidy publishers. Opinions expressed are those of the author and are not intended to describe or reflect upon any particular publisher.
Please keep in mind that this discussion applies to unethical "vanity presses" that now often call themselves "subsidy" presses. There are ethical subsidy presses that assist authors who wish to self-publish with the assistance of a reputable publisher. To protect yourself, you should always fully understand what you are contracting for, how much it's going to cost, and what you should expect from your publishing contract. It is highly recommended that you review all publishing contracts with a competent lawyer who works with intellectual properties as a significant portion of their practice.
The (unethical) Vanity (or Subsidy) Press
How the scam works:
An unethical vanity (or subsidy press) requires the author to pay all the costs and does not (really) do any effective marketing, sales, or placement of any kind. Any and all marketing efforts are totally up to the author--however, the contract signed with the vanity publisher may give the impression that considerable marketing work will be performed. More likely, the smooth salesperson will, without making any real promises, lead the author to believe that the vanity publisher will make considerable effort to market the title.
The vanity/subsidy press will file copyright documents, provide ISBN, and secure LOC CIP as necessary. The author will pay all the costs (usually inflated) of editing, design and production, and printing. You are lead to believe that the publisher will "take care of everything" for you. The key concepts are that "you have nothing to worry about;" and " you don't have to do anything (much) to sell the book."
Even if the unethical vanity (or subsidy) presses did send books to the reviewers and bookstores, it is unlikely that any sales would result. Reviewers and bookstores know who the vanity press scammers are and will have little, if anything, to do with them. The reviewers and bookstores realize that a vanity/subsidy press is only interested in authors whose checks don't bounce. Therefore, it is assumed that the publications from such publishers have little merit. So if a vanity/subsidy publisher actually does any marketing it seldom has any effect.
As for the inventory, in the worst case, the vanity/subsidy press, after the specified length of the contract, will tell the author that the books are not selling and therefore will be destroyed--unless the author buys them. So the author, who has paid up front more than the cost of producing and printing the books, does not own them. Now to keep the books, the author must buy them (again) from the publisher. At this point, the author is also "stuck" with the vanity/subsidy press ISBN, which is almost a "kiss of death" in the trade market. (See the previous paragraph.) It is also likely that the author has given an assignment of rights to the vanity press--and, depending on the contract, may be forced to "buy back" the copyright.
Avoid unethical vanity or subsidy publishers (both online and offline). You are likely to pay an inflated amount and will receive very little of value for the expense.
Look carefully at small publishers and co-publishers. (Watch out! When "vanity" presses became identified with publishing scams, they changed their identity to "subsidy" publishers. Now that "subsidy" publishing is sometimes identified with the scam artists, some of them are beginning to use the term "co-publishing.") Be sure to carefully read any contracts and have them reviewed by a lawyer--one who is familiar with the publishing industry. Be alert for all the usual signs of a scam--if it seems "too good to be true," it probably is.
Consider self-publishing. (Become an independent publisher.) While it is unlikely that an author will have the skills to truly do it all, there are good, honest, and competent consultants, graphic artists, small presses, and publicity firms that can help you successfully self-publish your work.
Small Publishers And Co-publishing
There are some regular (small) publishers that will do the production work and help you with marketing for a fee. However, you are, usually, the publisher with your own ISBN and ownership of all rights to the book. The publisher gains by keeping production staff busy (and employed), the author gains by obtaining professional services.
Online Subsidy Publishers
Sometimes these are called "POD Publishers." Get published "for free!" says one. Most of the others offer low or moderate-cost means to "get published" with various packages offering services that "take care of everything" (just like the classic vanity press scam). Most talk about paying "royalties" --- after you've paid for everything.
The common features include: They prepare or you provide a PDF of the book interior. You select a cover design, usually a stock design, but some offer more options or even allow you to suggest/provide cover art. They claim to submit your book to reviewers. They will put your book in their online store (that only is viewed by other writers desperate to be published). Most will offer to put the book on Amazon.com (usually at an unreasonably high, uneconomic price). And, of course, they will all sell copies to you at a discount from list price.
Read More Before You Leap Into Self-Publishing
I strongly suggest you read the full article and absorb the differences between subsidy and vanity publishers before you fork out any money. Please do read our self-publishing advice section as we advocate the self-publishing route where any author who wants to publish their own books - DO NOT have to pay anyone to do it for them.
There are so many self-publishing platforms that allow you to get started in publishing your books without the need to spend money on a publisher. I certainly won't be doing that when I publish my novels!