Antitrust trial begins for Penguin Random House
A courtroom showdown between the U.S. Department of Justice and Penguin Random House began Monday as the United States seeks to block the publishing company’s $2.2 billion acquisition of Simon & Schuster. Renowned author Stephen King, whose books are published by Simon & Schuster, is expected to be the government’s star witness Tuesday. The federal government’s move takes place as the Biden administration aims to hold firm on an antitrust agenda, asking the Justice Department and the Federal Trade Commission to give greater scrutiny to big business combinations.
Why the trial? The merger, if it occurs, will reduce the “Big Five” of the U.S. publishing houses—who make up 90 percent of the market for anticipated top-selling books—to four. The federal government alleges that combining the two companies would cut authors’ pay and reduce the number of accessible books for consumers. Penguin Random House argues that the merger would increase competition and the amount authors are paid.
Dig deeper: Read Jenny Rough’s report on how many “authors” haven’t written the books with their names on them.
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