Sunday, January 29, 2023

US sues Penguin Random House over plans to acquire Simon & Schuster

The US Department of Justice wants to block the world’s largest publisher, Penguin Random House, from acquiring rival publisher Simon & Schuster, which is the fourth largest in the United States.

An antitrust lawsuit filed Tuesday in federal court warns that such an acquisition would hurt competition for top-selling manuscripts. According to the Justice Department, a thinner, more tightly controlled publishing industry would leave writers with fewer options and a newly consolidated Penguin Random House would allow authors to offer less for their work.

The department’s complaint states, “Writers are the lifeblood of book publishing. Without writers, there would be no story, no poetry, no biography, no written discourse on history, art, culture, society or politics.” ” “The proposed acquisition of Simon & Schuster by Penguin Random House will result in substantial losses to authors, especially authors of anticipated top-selling books.”

The pending acquisition is valued at approximately $2.2 billion.

Five publishers, known as the “Big Five”, dominate the publishing industry. They offer high upfront and lucrative marketing for highly anticipated manuscripts, and compete with each other for the next biggest deal.

The antitrust suit is an unusually bold move in a highly cohesive industry. Publishing companies Penguin Group and Random House merged without problems in 2013.

“If the world’s largest book publisher is allowed to acquire one of its biggest rivals, it will have unprecedented control over this important industry,” US Attorney General Merrick Garland said in a department statement.

“American authors and consumers will pay the price of this competitive merger – less upfront and ultimately less books for authors and less diversity for consumers.”

Jonathan Karp, Simon & Schuster’s president and chief executive officer, disagrees with the department’s complaint. In an internal memo sent to Simon & Schuster employees on Tuesday, Karp wrote that his company and Penguin Random House see no basis for the lawsuit and plan to fight it.

The New York Times reports that Penguin Random House has hired attorney Daniel Petroselli, who helped AT&T and Time Warner fight the Justice Department’s antitrust lawsuit.

Penguin Random House did not respond to VOA’s request for comment.


This article is republished from – Voa News – Read the – original article.

Nation World News Desk
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