Fan fiction does infringe copyright most of the time—at least under EU copyright, which does not have fair use. Under US copyright, defending fan fiction as fai

Fan fiction does infringe copyright most of the time—at least under EU copyright, which does not have fair use. Under US copyright, defending fan fiction as fair use isn’t quite the slam dunk either. If publishers aren’t quick to litigate fan fiction away, I’d say it’s because they decided that it’s actually beneficial to them. It keeps the community invested in the fictional universe, and the canonical works only gain in respect—and these are the only ones making money. So it’s a social contract between fan fiction authors and publishers. That is why fan fiction communities try to moderate submissions to keep their end of the bargain—i.e. no selling of fan fiction, and no fan fiction that could be seen as detrimental to the image of the work (for example erotica is not allowed in many places). Related to this, the novel 50 shades of grey had a pretty interesting genesis where it started out as a twilight fan fiction, which was booted of fan fiction sites because of its explicit content. The author then created her own website. Because she gained a massive following, she realised that she could commercialise the novel. That’s when she changed all the names in the novel to no longer refer to Twilight characters. Because she had already transposed the characters to another universe, at that point there wasn’t much of Twilight left and she was free to market and sell it.