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From Publishers Lunch overnight:

Random Drops the Next Shoe: Rubin and Applebaum Stepping Down in Reorg

The first part of the Random House reorganization everyone has been expecting under new ceo Markus Dohle was announced this morning.

President and publisher of the Bantam Dell group Irwyn Applebaum is leaving the company immediately after 25 years there. Dohle calls him "one of the most successful publishers in our industry. He is widely regarded as a champion of great storytelling, with marketing acumen to match."

The publishing line itself is being absorbed by the Random House group, under Gina Centrello, along with the Spiegel & Grau unit that had been part of Doubleday.

It puts the company's two big mass-market lines together in the same division, though Dohle says that they will "continue to have separate editorial departments."Doubleday is also being eliminated as a freestanding group, which means president and publisher Steve Rubin's job no longer exists.

Here Dohle says he is "currently in discussions" with Rubin "about creating a new role for him at Random House, Inc., working directly with me. As you know, Steve has successfully led Doubleday for almost two decades and is universally respected and admired throughout the industry for both his publishing expertise and management skills."Knopf will absorb the Doubleday and Nan A. Talese lines, while the Crown group will incorporate Broadway, Doubleday Business, Doubleday Religion and WaterBrook Multnomah.Dohle does indicate that "the newly formed publishing groups will continue to bid independently in auctions," though there are now three of them instead of five. "Each group will have my full support to publish autonomously, promote aggressively, and strive for more competitive advantages in the marketplace."

Dohle tells employees he has "created a plan for our future that aligns existing strengths and publishing affinities and fosters teamwork throughout the company. It will maximize our growth potential in these challenging economic times and beyond."As for the next shoes to drop, Dohle says "Coordinating our online marketing and growing our digital publishing business will be further priorities. Gina [Centrello], Jenny [Frost], Sonny [Mehta] and I will share our more specific publishing plans and organizational structure in due course."

(Close observers of the company will note that the memos were distributed by Random group executive director of publicity & public relations Carol Schneider rather than Stuart Applebaum.) He also notes that "because of the current economic crisis, our industry is facing some of the most difficult times in publishing history."

See the memos here:

Dohle letter

Rubin memo

Applebaum memo