From The Literary Hub:
Well, Simon & Schuster is not going to be sold, for now. A federal judge ruled in October that Penguin Random House couldn’t buy the publisher, and since then, Simon & Schuster’s parent company has decided against mounting an appeal. That said, the future of America’s third-largest publisher still remains uncertain. Simon & Schuster’s owner seems intent on selling, with potential buyers reportedly including HarperCollins, Hachette Book Group, or—gulp—an unnamed private equity firm. As a new author with Atria Books (a Simon & Schuster imprint) none of these options seem especially great. What will happen to Atria? To my wonderful editor? My first book?
Following mergers between major publishing houses in the past, corporate executives have cut jobs, folded imprints, and canceled author contracts. My novel is scheduled to debut next August. My wonderful editor assures me that things will be fine, and I trust him. He is, after all, wonderful. Unfortunately, these kinds of things aren’t up to him. Even the most wonderful editors get no say when it comes to major decisions regarding the future of the “Big Five” publishing houses.
In publishing, as with far too many industries, democracy is all but absent in the workplace. The people who do the day-to-day work of running Simon & Schuster—the editors, marketers, publicists, cover artists, copyeditors, accountants, and so on—don’t get a vote on whether their company should be sold, or to whom. We tend to think of this structure as the natural capitalist order—employees do the work, corporate executives and investors call the shots—but it doesn’t need to be this way.
Our nation’s third-largest publisher doesn’t have to be owned by a mass media conglomerate or a private equity firm. There exists another option, one that would bring much-needed democracy to publishing by putting decision-making power into the hands of the very people who know books best: let the employees of Simon & Schuster purchase Simon & Schuster. They do the work, after all. Let them own their company. Let them call the damn shots.
Worker-owned cooperatives are so rare in America that it’s difficult for us to imagine the sense of pride and ownership that comes when we work for ourselves, participating actively in major company decisions, sharing equally in profits and losses.
But the idea of employees buying and running their own company—even here in America, even in publishing—isn’t as utopian as it sounds: the workforce of WW Norton has successfully owned and managed the venerable publishing house since shortly after World War II, when Mary Norton sold her stock to the company’s editors and managers. They drew up a Joint Stockholders Agreement that still remains in effect, allowing active Norton employees to elect leadership, participate in decisions affecting the company’s future, and share profits. Anyone who leaves Norton must sell back their shares, ensuring that no outside market exists for ownership of the company. There is no risk of a hostile takeover, no fear of an unexpected sale. The employees are free and independent to do what they have done so well for decades: publish kickass books, from classics like the Feminine Mystique and Clockwork Orange to newly released knockouts like The Immortal King Rao and Activities of Daily Living.
By comparison, four of the Big Five publishing houses are subsidiaries of global media conglomerates which are, in turn, majority-owned by four billionaire families from Germany, Australia, and the United States. (Hachette Books, the outlier, is a subsidiary of a global media conglomerate that is minority-owned by a billionaire family). Simon & Schuster is owned by Paramount Global, which is operated and owned by a private “mass media holding company” called National Amusements, which is based in Massachusetts and owned by the billionaire Redstone family. Paramount Global, in an official 2020 press release, gave three reasons for selling the “non-core asset” that we writers and readers refer to as Simon & Schuster:
- to fund Paramount’s new streaming services
- to pay down debt
- to “fund the dividend”
It would be inconceivable for the owners of WW Norton to make such a decision, or even to face such a dilemma, precisely because Norton is owned by its employees. Presumably they would choose not to cannibalize themselves to make wealthy stockholders a little wealthier. Presumably they would not refer to themselves as a “non-core asset.”
But Simon & Schuster, with approximately 1,500 employees, is a far larger company than WW Norton. Could America’s third-largest publisher seriously operate as a cooperative? For inspiration, let’s zip across the Atlantic; the Mondragon Corporation, founded in Spain in the 1950s, is a federation of over 200 cooperatives and organizations that together employ over 80,000 people who collectively own and manage every aspect of their many businesses.
Link to the rest at The Literary Hub
Color PG skeptical about this proposal.
The reason that Simon & Schuster is for sale is that its owner, Paramount Global, wants a big check. Paramount Global wants a big check because, after going through a hierarchy of companies, the wealthy family that ultimately owns and controls S&S wants a big check. In this case, the wealthy family is the Redstones.
PG doubts that the employees of Simon & Schuster collectively, have enough money to satisfy the Redstones. After all, traditional publishing is noted for not paying its employees very well. PG doubts the Redstones would agree to set up a payment plan with the employees. If the Redstones want to sell, PG suspects it’s because they want a big check.
Would a bank or another rich family want to buy Simon & Schuster? PG has his doubts because the traditional publishing business doesn’t earn much money any more. S&S is worth something, but likely not enough to induce anyone responsible to loan the employees the money to pay the Redstones. But, as usual, PG could be wrong.