Every author's new best friend

The literary agent used to be a silent, unglamorous figure - but no longer. DJ Taylor explains

In the end, of course, practically any human situation or career path can be turned into a fit subject for drama. Even so, it comes as something of a shock to learn that someone has converted the life of Margaret "Peggy" Ramsay into a stage play. Philip Larkin's love triangle; hypnotherapists struggling with their patients - to take only two current theatrical attractions - somehow this is the kind of thing you expect to see rendered down by actors. But the life of a theatrical agent?

In fact, as is demonstrated by Simon Callow's evocative memoir Love is Where it Falls: The Story of a Passionate Friendship, Peggy Ramsay was a forceful character: shrewd, inspiring, and a kind of figurative lightning bolt regularly drenching the young actor's progress in sharp white light. At the same time, her metamorphosis into a stage heroine, rather than the promoter of other heroines, is neatly symbolic of a wholesale transformation in modern creative life: the rise of the agent.

Leaving aside professional sport - where mention of a name like Eric Hall can have many a Premiership chairman gnashing his teeth with rage - this transformation has been at its sharpest in the world of books. Thirty or even 20 years ago, the average literary agent was a shy, retiring flower, fearful of publicity, satisfied with his 10 per cent and a mention in his proteges' memoirs. Three decades on, Sunday supplement arts pages bulge with admiring profiles of industry savants such as Andrew Wylie or hip young thrusters like Johnny Geller of Curtis Brown, while an event as routine as the party marking Michael Sissons's retirement from the helm of Peters Fraser & Dunlop became a gossip columnists' staple.

The power wielded by, and money made by, modern literary agents is one of the great givens of contemporary publishing. Not only is manuscript- broking extremely profitable - big outfits such as Peters Fraser & Dunlop, Rogers Coleridge & White and Aitken & Stone may turn over only a few million a year, but then where are their overheads? Such is the clout of top operators, and the desire among publishers not to offend the people they represent, that any kind of industry restructuring (a big publisher reorganising its trade division, say) often finds them intervening personally in the round of hirings and firings. Effectively, many a top literary agent doubles up as a surrogate management consultant, along the lines of "You can't do that, HarperCollins/ Viking Penguin because my client wouldn't like it".

From the vantage point of history, all this has happened in a comparatively short space of time. Although early Victorian literature is full of friendly representations and polite words being put in, as a species the literary agent barely existed until the end of the 19th century. The status of the early practitioners such as JB Pinker and A.P Watt - the latter still a powerful operator a century later - wasn't high. One of PG Wodehouse's Mulliner stories, for instance, contains a character whose novel-scribbling fiancee is seen attending the theatre with a saturnine male escort. "Who was that man I saw you with last night?" he barks out. "That wasn't a man," Evangeline sweetly replies. "That was my literary agent."

Predictably, the agent's rise up the professional scale began in America. The rewards on offer were greater, and they encouraged the kind of flamboyant personalities discouraged on this side of the Atlantic. "That Mrs Hill, giving herself such airs," the proprietor of Cosmopolitan used to sniff over the famous Carol Hill. "And she is only an agent". But agents like Hill and the equally flamboyant - and alcoholic - Carl Brandt (to whom Hill was briefly married) brought a new dimension to the idea of paying someone to get a better price for your book than you could otherwise do yourself. They may have been prima donnas; equally their notions of author care went beyond generally accepted standards. One of Hill's English authors, arriving at her office in New York, was startled to be told that she'd just set sail for England, believing that the new wife of one of her best clients wasn't up to the task of keeping her husband off the drink.

But the real boost to agent power came in the early 1980s publishing shake-up, the detonation of ancient practices and attitudes to money from which even now the industry is still recovering. From about 1980 onwards, in an atmosphere of profound economic uncertainty but buttressed by huge adhesions of (mostly) foreign cash, the previously timid and mostly independently- run British publishing scene changed out of all recognition. Small firms agglomerated to produce big firms. Enormous amounts of money were suddenly available, and advances skyrocketed. At the same time, everyone was making staff cuts, especially in editorial departments. The big agents emerged from this explosion with a vast increase in their power and prestige. They were dealing with fewer people and publishing fewer books, which meant that the best-selling authors they represented were even more valuable. Threaten to take Jack Higgins or Freddie Forsyth away from publisher X, and publisher X would listen to you. At the same time, with a dearth of editors, agents were able to exert much more of an influence on the material they sold, frequently employing their own editorial staff to knock manuscripts into shape.

The upshot, a decade and a half later, has been that the publishing- business model has been turned on its head. In the old days a primary producer (the author) conveyed his product by way of the agent to the secondary producer (the publisher) who then sold it via the distributor (the bookseller). Now, the agent is increasingly the secondary producer, creating and finessing the product, which he then allows the publisher to market - rather like an independent Hollywood producer licensing his work to a major studio. Increasingly in modern publishing much of the profit is made on the right and left sides of the model, rather than in the centre, where sits the cash-strapped and frequently unhappy figure of the publisher.

What effect does all this have on the world of books? From the point of view of the writer, agent power is a wonderful thing (I speak as someone whose receipts were immediately quadrupled when transferring from agent A to agent B 10 years back). On the other hand, predatory agents can frequently leave their clients comatose in dust after the cash frenzy has burnt itself out. An increasingly common phenomenon is for an agent to sell a writer's first book for a huge sum of money - too much for it to make a profit for the publisher, who consequently offers less for the second and will probably pass on the third altogether. In commercial terms, this transfer of influence is probably irrevocable. If every major British publisher - not a description that means anything as they are all foreign-owned - banded together, they might make some kind of a dent in the carapace of agent power, but rivalry would always scupper the plan. Meanwhile, as a version of Peggy Ramsay's life proceeds to the London stage, it seems a safe bet that years will pass before anyone writes a play about a publisher.

`Peggy for You' opens at the Hampstead Theatre, NW3 (0171 722 9301) on Tuesday.

DJ Taylor's new book is `Thackeray' (Chatto, pounds 25)