The one part of all that which probably requires more explanation is the second point, that publishers can’t reliably publish new titles profitably anymore. So there won’t be One Big Publisher in ten years, but there very well might be One Big Distributor. In fact, one would expect over time that they too, one by one, will give up maintaining overheads in favor of using Ingram themselves. The Big Five will continue to operate as shrinking but very profitable entities for a long time. The expectation here had been that publishing would continue to consolidate until sometime later this decade PRH would be the only one left. So Ingram’s steady growth in title count and sales volume can continue.Ĥ. Instead, they provide services that require scale to publishers without the publisher needing to finance the overhead. The list of titles distributed and managed under their auspices can continue to grow, because Ingram doesn’t buy the companies or own the titles under their umbrella. The biggest winner with today’s decision is Ingram. This decision would appear to cut off that avenue, or at least cut publishers off from the biggest potential additions.ģ. So the biggest publishers have grown their title base by acquisition. But publishers can increasingly milk sales out of the long tail of backlist, thanks to the new digital marketing world we live in. Publishing new titles profitably has become exceedingly difficult. The only way to expand a publishing house is to have a larger number of active titles. The five biggest publishers are probably at their high water mark for market share. That will not be good news to Hachette and HarperCollins, both of which opposed the PRH-S&S merger but probably hoped they could pursue S&S if the publisher remained independent.Ģ.
None of the Big Five can merge with each other without triggering the same concern Judge Pan cited in making this decision. (I comment on the fact of it I have no idea about the law.)ġ. The judge ruled that cutting that number from five to four would reduce the spend among that cohort of books, which is almost certainly true. In other words, the big books by big authors for which only the Big Five can compete regularly (with occasional bids coming in from a couple of other next-tier houses) will continue to have five well-funded suitors. The ruling was explicitly to protect the “competition” for the “anticipated top-selling books”. Pan ruled today that the acquisition of Simon & Schuster by Penguin Random House could not go forward.
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