WASHINGTON (AP) — Government and publishing titans are set to exchange opening salvos at Penguin Random House a federal antitrust trial Monday As America seeks to prevent the largest American book publisher from absorbing rival Simon & Schuster. The case comes as a crucial test for the Biden administration antitrust policy,
The Justice Department has sued to block $2.2 billion mergerWhich would reduce the Big Five US publishers to four.
In an unusual move the government will witness Stephen King, renowned and genre-transcending author whose works are published by Simon & Schuster. King is expected to testify during the week-long trial in US District Court in Washington, DC
The government argues that if German media titan Bertelsmann, of which Penguin Random House is a division, is allowed to buy Simon & Schuster from American media and entertainment company Paramount Global, it would hurt writers and ultimately readers. It says the deal would thwart competition and give Penguin Random House a huge influence over the books it publishes in the US, possibly due to how much authors are paid and consumers getting fewer books to choose from.
Publishers contend that the merger would strengthen competition among publishers to find and sell the most popular books, allowing the combined company to provide larger upfront payments and marketing support to authors. He says this will benefit readers, booksellers and writers.
Opposing attorneys for both sides will present their cases before US District Judge Florence Paine.
The two New York-based publishers have impressive stables of blockbuster authors who have sold several million copies and scored multimillion-dollar deals. Barack and in the constellation of Penguin Random House Michelle ObamaWhose memoirs totaled an estimated $65 million package deal, Bill Clinton, who received $15 million for his memoirs, Toni Morrison, John Grisham and Dan Brown.
Simon & Schuster matters Hillary Clinton, who received $8 million for his memoir, Bob Woodward and Walter Isaacson. and the king.
Bruce Springsteen splits the difference: his “Renegades: Born in the USA”, with Barack Obama, was published by Penguin Random House; His Memoirs by Simon & Schuster.
The Justice Department argues that as things stand, No. 1 Penguin Random House and No. 4 Simon & Schuster compete fiercely for the rights to publish the anticipated best-selling books, by total sales. If they are allowed to merge, the combined company would control about 50% of the market for those books, it says, harming competition by reducing advances paid to authors and reducing production, creativity and diversity. is delivering.
The Big Five – the other three being Hatchet, HarperCollins and Macmillan – dominate American publishing. The government says they make up 90% of the market for estimated top-selling books.
The Biden administration is laying new ground on business concentration and competition, and the government’s case against the publishers’ merger could be seen as a significant step forward.
President Joe Biden has made competition a pillar of his economic policy, which he calls the external market force of an array of industries, and stresses the importance of strong competition for the economy, workers, consumers and small businesses. Biden, a Democrat, has called on federal regulators, particularly the Justice Department and the Federal Trade Commission, to investigate larger business combinations more.