Unlike the Staples - Office Depot merger, about which I couldn't care less, or a tech giant stifling smaller competition by buying it:
These are two giants in a very small oligopoly. I can't see any consumer benefit to a merger, and lots of potential for harm. This is what antitrust law is supposed to be all about.
I suppose you could argue they're in a declining business and need to cut costs. But I don't think either would admit to that.
If you allow this company to happen then they’ll be able to set the market price for buying and selling books to libraries, bookstores, bookstores, etc….
If this were to happen they would also be able to limit how many books are being printed, and therefore they may censor authors and books that have unpopular or controversial opinions. They’ll also try to control the amount of books that get sold to the public because it could increase the prices of buying them in bookstores.
> The largest five publishers control 90% of the market.
This is not dissimilar to the music market. It used to be controlled by 5 companies, now it's down to three.
The result? Creators are paid peanuts while the blame is shifted away from actual companies controlling the market to someone else.
As a former employee of Storytel, the Swedish audiobook app, I'm really glad for this decision. Penguin Random House already has an insane outsized and rarely positive influence on the market. The merger would've only made things worse.
It's incredible to me that this is only a 2.2B merger, when I think about how much space in my house is dedicated to books, and how much of my discretionary spending is for books (plus indirect demand through libraries.)
On the other hand, I doubt whether any of the last 10-20 books I've bought were Penguin Random House...
> Executives from PRH and Simon & Schuster argued that ... the merger would actually benefit writer pay, because it would lead to savings and allow them to spend more on books.
I snorted at that. This is the same old shtick companies trot out every time they want to do something egregiously anti-consumer--or in this case, anti-creator. That there are apparently still people that this routine works on is a touch depressing, but at least the judge wasn't one of them.
This was the quote that got a "are you f'ing kidding me?" from me:
> Penguin Random House lawyer Daniel Petrocelli, who defeated the government in a previous merger challenge, argued during the trial that the deal would have “enormous benefits” for readers and authors alike since the imprints, or brands, owned by the two giants would continue to compete against each other.
Glad to read in the next paragraph that Stephen King got to call that out as "ridiculous" in court.
> That there are apparently still people that this routine works on is a touch depressing
Each time I think that, I then immediately realize that every year, there's a fresh cohort just becoming adults, who are yet to fall for all these tricks. These things works because there's an endless supply of new marks.
Good. This is one step to stop the future from looking like that Internet Archive thing they did for their 25th anniversary: https://wayforward.archive.org/ia2046/.
Right decision for the wrong reasons? I think the bidding wars hurt the vast majority of authors, where all the money and energy and physical product space in bookshops gets sucked into a handful of authors leaving the majority of respected, award winning and decent selling authors begging for scraps during their lunch break at their day job. But I don't a merger would have helped at all.
Europe is working on this and the EU recently passed laws to open up digital ecosystems and improve competition and market conditions for smaller players.
While these won't directly apply to other markets and may not even be that successful, such legal precedence have a tendency to spark regulatory and legislative action around the world.
Oh man remember when Meta / Facebook was a monopoly and we had to do everything in our power to stop them? And now their stock is down 75% in the last 12 months and they are getting beaten up by competitors? And without any government intervention! It's almost like the world is always dynamic and who is on top today isn't on top tomorrow...
Facebook active users have increased so their influence is only increasing.
But I disagree that Facebook is a monopoly -- their market is advertising and there is still plenty of active competition in the online advertising marketplace.
[+] [-] AlbertCory|3 years ago|reply
These are two giants in a very small oligopoly. I can't see any consumer benefit to a merger, and lots of potential for harm. This is what antitrust law is supposed to be all about.
I suppose you could argue they're in a declining business and need to cut costs. But I don't think either would admit to that.
[+] [-] JumpCrisscross|3 years ago|reply
Economies of scale in production and distribution exist.
> lots of potential for harm
Yes. The scaling economies are dwarfed by the extractive ones.
[+] [-] nullish_signal|3 years ago|reply
If this were to happen they would also be able to limit how many books are being printed, and therefore they may censor authors and books that have unpopular or controversial opinions. They’ll also try to control the amount of books that get sold to the public because it could increase the prices of buying them in bookstores.
[+] [-] quickthrower2|3 years ago|reply
[+] [-] Finnucane|3 years ago|reply
[+] [-] dmitriid|3 years ago|reply
This is not dissimilar to the music market. It used to be controlled by 5 companies, now it's down to three.
The result? Creators are paid peanuts while the blame is shifted away from actual companies controlling the market to someone else.
As a former employee of Storytel, the Swedish audiobook app, I'm really glad for this decision. Penguin Random House already has an insane outsized and rarely positive influence on the market. The merger would've only made things worse.
[+] [-] tbihl|3 years ago|reply
On the other hand, I doubt whether any of the last 10-20 books I've bought were Penguin Random House...
[+] [-] tough|3 years ago|reply
[+] [-] indigodaddy|3 years ago|reply
[+] [-] sexy_seedbox|3 years ago|reply
[+] [-] a_shovel|3 years ago|reply
I snorted at that. This is the same old shtick companies trot out every time they want to do something egregiously anti-consumer--or in this case, anti-creator. That there are apparently still people that this routine works on is a touch depressing, but at least the judge wasn't one of them.
[+] [-] hn_throwaway_99|3 years ago|reply
> Penguin Random House lawyer Daniel Petrocelli, who defeated the government in a previous merger challenge, argued during the trial that the deal would have “enormous benefits” for readers and authors alike since the imprints, or brands, owned by the two giants would continue to compete against each other.
Glad to read in the next paragraph that Stephen King got to call that out as "ridiculous" in court.
[+] [-] TeMPOraL|3 years ago|reply
Each time I think that, I then immediately realize that every year, there's a fresh cohort just becoming adults, who are yet to fall for all these tricks. These things works because there's an endless supply of new marks.
[+] [-] MegaSec|3 years ago|reply
[+] [-] Yawnzy|3 years ago|reply
[+] [-] christopherwxyz|3 years ago|reply
Plus, United States v. Paramount in 1948 prevents a lot of the vertical integration that could be achieved in their former markets.
The only other place they can go is the even more crowded market that is online.
[+] [-] stubish|3 years ago|reply
[+] [-] paulpauper|3 years ago|reply
[+] [-] Vespasian|3 years ago|reply
While these won't directly apply to other markets and may not even be that successful, such legal precedence have a tendency to spark regulatory and legislative action around the world.
[+] [-] quickthrower2|3 years ago|reply
[+] [-] croes|3 years ago|reply
They mean Bertelsmann https://en.m.wikipedia.org/wiki/Bertelsmann
[+] [-] seibelj|3 years ago|reply
[+] [-] wvenable|3 years ago|reply
But I disagree that Facebook is a monopoly -- their market is advertising and there is still plenty of active competition in the online advertising marketplace.
[+] [-] croes|3 years ago|reply
Sure? https://news.ycombinator.com/item?id=33407857
[+] [-] paulpauper|3 years ago|reply
[+] [-] andrewflnr|3 years ago|reply
[+] [-] heavyset_go|3 years ago|reply