DOJ Doesn't Want Publishing's 'Big Five' Becoming 'Big Four'

Files antitrust suit to stop major book publisher merger
By Newser Editors and Wire Services
Posted Nov 3, 2021 2:43 AM CDT
DOJ Doesn't Want Publishing's 'Big Five' Becoming 'Big Four'
Stock photo.   (Getty Images / jakkaje808)

The Justice Department is suing to block a $2.2 billion book publishing deal that would have reshaped the industry, saying consolidation would hurt authors and, ultimately, readers, the AP reports. German media giant Bertelsmann's Penguin Random House, already the largest American publisher, wants to buy New York-based Simon & Schuster, whose authors include Stephen King, Hillary Clinton, and John Irving, from TV and film company ViacomCBS. The Department of Justice filed an antitrust suit in federal court in Washington, DC, on Tuesday in the first major antitrust action by the Biden administration. The department said the deal would give Penguin Random House “outsized influence" over which books are published in the US and how much authors are paid.

“If the world’s largest book publisher is permitted to acquire one of its biggest rivals, it will have unprecedented control over this important industry," Attorney General Merrick Garland said. “American authors and consumers will pay the price of this anticompetitive merger—lower advances for authors and ultimately fewer books and less variety for consumers." The purchase of Simon & Schuster would reduce the so-called Big Five, which dominate American publishing and also include HarperCollins, Hachette Book Group, and Macmillan, to four. Authors published by those companies have the greatest chance of becoming best-sellers, NPR reports.

The deal raised concern from writers and from rival publishers. The Authors Guild has said it opposes the acquisition because there would be less competition for authors’ manuscripts. Rupert Murdoch's News Corp, which owns HarperCollins and had reportedly also been interested in buying Simon & Schuster, also slammed the deal. Its CEO Robert Thomson said last fall that Bertelsmann was “buying market dominance as a book behemoth.” In a statement, Penguin Random House and Simon & Schuster said they would fight the lawsuit. They say blocking the deal would harm authors. But the suit cites comments from executives at both companies that seem to confirm the DOJ's fears that taking the Big Five down to Big Four would ultimately have a detrimental effect on bidding for authors' books, CNN reports.

(More Simon & Schuster stories.)

Get the news faster.
Tap to install our app.
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.