From The Wall Street Journal:
ViacomCBS Inc. is selling book publisher Simon & Schuster to German media giant Bertelsmann SE for almost $2.18 billion, ViacomCBS said Wednesday, in a deal that would create a publishing behemoth accounting for about a third of all books sold in the U.S.
The transaction would put the publishers of some of the world’s bestselling authors including Stephen King, Bob Woodward, Dan Brown and John Grisham under the same corporate umbrella. Bertelsmann SE’s Penguin Random House already is the U.S.’s largest publisher by books sold, while Simon & Schuster is the third largest, behind News Corp’s HarperCollins Publishers.
ViacomCBS put Simon & Schuster up for sale in March, saying it would use the cash proceeds to further invest in its streaming-video efforts.
. . . .
Markus Dohle, chief executive of Penguin Random House, said the deal shouldn’t raise competition concerns. “If you look at the book market, it is unconcentrated,” he said, adding that over the past decade many small new publishers emerged. “There have been a lot of new successful entrants in the market.”
Robert Thomson, chief executive of News Corp, which owns HarperCollins Publishers, said the deal would harm distributors, retailers, authors and readers. “There is clearly no market logic to a bid of that size—only anti-market logic,” he said in a statement. “Bertelsmann is not just buying a book publisher, but buying market dominance as a book behemoth.” News Corp also owns The Wall Street Journal.
. . . .
Including Simon & Schuster, that U.S. market share would rise to about 34%. HarperCollins Publishers, the second largest publisher by unit sales, accounted for about 11% of print books sold in the U.S. during the same period.
Richard Pine, a well-known New York literary agent, said he is concerned the creation of such a large publishing house would “lead to an unhealthy obsession with publishing mega bestsellers.”
“It’s like baseball, you need the minor leagues,” Mr. Pine said. “Authors need to be nurtured. If you have a system of one book and done when the magic didn’t happen, then those writers will be left behind.”
Lorraine Shanley, president of the industry consultants Market Partners International Inc., said adding Simon & Schuster to Penguin Random House’s portfolio “would make it increasingly difficult to compete, not just for the other big publishers but for the smaller publishers. Penguin Random House is also a major distributor, as is Simon & Schuster. Between the two they’d have a very large segment of the market when it comes to distribution.”
Link to the rest at The Wall Street Journal (PG apologizes for the paywall, but hasn’t figured out a way around it.)