DOJ Sues to Block the Bertelsmann/PRH Buyout of S&S

As noted by John Maher, Andrew Albanese, and Jim Milliot in Publishers Weekly, the U.S. Department of Justice is suing to stop the acquisition of Simon & Schuster, citing “harm to authors.” The article links to the text of the suit and capably sets out the reasons for the suit and the publishers’ unsurprising response that the suit “is mistaken” and that the buyout would "benefit all constituents, including authors, agents, retailers, and, ultimately, readers, and will do nothing to undermine the robust, competitive publishing landscape that currently exists."

RF will leave it to the DOJ to show how this deal hurts authors, simply noting that fewer publishers vying for authors seems likely to result in fewer contracts, a greater commodification of the written word and emphasis on the blockbuster best seller, and more authors having to turn to Indie publishers. Our concern is with the library market. From our perspective, a challenge to the buyout is in order.

On the surface, there is little difference between PRH and S&S in terms of library digital contracts. Their ebook terms are remarkably similar. PRH still offers perpetual-access digital audiobooks, while S&S now has metered access for two years but in some cases slightly lower prices overall in audio. A slight advantage to PRH. then So, why should libraries be pleased to see the DOJ weigh in, if PRH were to offer slightly better future terms than S&S might have?

The answer is not just the possible contraction in available titles that might result from consolidation. Maryland’s (and we can hope soon, New York’s!) law does not set market price but only requires fair terms. An even more dominant publisher, controlling ever more of the market, would be even more resistant to offering libraries “reasonable terms” than we currently see. Reducing the number of providers certainly won’t promote competition. The resulting behemoth would be even better poised to fight off legal challenges and public campaigns for a library square deal.

Libraries must advocate for Controlled Digital Lending and federal guidelines supporting the Maryland/New York laws pushing towards library rights to circulate digital under copyright and not license. In the meantime, preventing the the creation of a FrankenPublisher monster is desirable.