By Jonny Lupsha, Wondrium Staff Writer
Penguin Random House’s purchase of Simon & Schuster is on hold. The buyout has become an antitrust trial. Concerns exist that Penguin Random House will monopolize publishing. Five publishers release two-thirds of the books in the United States.
In November 2020, Penguin Random House announced its intent to purchase fellow book publisher Simon & Schuster. The Department of Justice sued, implying that the consolidation could result in monopolistic practices. This controversial deal has seen many opponents, one of whom is Simon & Schuster’s own client—and world-renowned horror author—Stephen King. King testified on Monday, August 1 for the government.
Penguin Random House and Simon & Schuster are two of just five New York-based publishers, who, together, produce approximately two-thirds of all U.S. books. In her video series How to Publish Your Book, Professor Jane Friedman, former publisher and editorial director of Writer’s Digest, explains the state of “the Big Five.”
The Big Five
Penguin Random House is already the biggest of the major publishing companies. They own over 200 imprints through which they publish worldwide, culminating in 15,000 new titles every year. According to Professor Friedman, Penguin Random House is twice as big as the following four publishers and produces 25% of the world’s English language books alone.
“The next largest publisher is HarperCollins, with more than 65 imprints,” she said. “And one of its best-known divisions is Harlequin, which they acquired in 2014. Simon & Schuster publishes about 2,000 titles per year under 35 different imprints.”
After that comes Hachette Book Group, which is a subsidiary of Hachette Livre, a French company. Hachette Book Group publishes about 1,000 books per year.
Finally, Macmillan rounds out the Big Five. According to Professor Friedman, Macmillan is the parent company of imprints like Farrar, Straus and Giroux, and St. Martin’s Press.
“The Big Five are all owned by media conglomerates,” she said. “For example, HarperCollins is owned by News Corporation and Simon & Schuster is owned by CBS. Publishing wasn’t always consolidated into the hands of a few media companies, but in the 1980s and 1990s, consolidation began and it hasn’t ever really stopped.”
Pros and Cons
The Big Five are currently close to becoming the Big Four, which raises questions and concerns over such a degree of business consolidation, hence, the antitrust suit.
Professor Friedman said that on the downside, it reduces competition, because different imprints under the same company won’t bid against each other to publish a book. At the same time, major companies are better suited to go toe-to-toe against Amazon, which is seen as one of the biggest threats to the publishing business.
“Perhaps the most important strength of any Big Five publisher is its distribution and reach into the physical retail market,” Professor Friedman said. “This is nearly impossible for a single author to accomplish; but if you publish with a Big Five house, it’s a near-guarantee that your book will sit on store shelves across the nation, including Barnes & Noble, independent bookstores, and a range of specialty retail outlets.”
Additionally, large publishers employ a sales force that aims to get retail placement with the biggest possible buy. With this in mind, authors have the challenge of writing a book that anticipates the needs of the market in order to merit the nationwide physical distribution in the publisher’s eyes. It’s easy to realize the problems that develop if writing a book simply to “fit the market.”
“In part, due to consolidation, the Big Five have been accused of producing homogenous and sometimes even mediocre work,” Professor Friedman said. “Whether that accusation is fair or not, they are reliably interested in work that demonstrates commercial potential from the outside.”
How to Publish Your Book is now available to stream on Wondrium.