Publishing teeters as Random House and Penguin plan to merge. It's time for a government policy to protect the arts
As with Hurricane Sandy, it will take a little while to discern the long-term consequences of the Penguin and Random House merger, the news of which was somewhat obscured by the storm and the election. But the short-term impact is not pretty — and it follows other recent bad news from the books world. The Free Press, known primarily for smart, contentious nonfiction from Emile Durkheim and Francis Fukuyama but also the publisher of Aravind Adiga’s best-selling Indian novel “The White Tiger,” just collapsed. Several well-regarded editors are now out of jobs as the imprint is merged into Simon & Schuster.
The Penguin and Random House merger would join two of the largest and most successful publishers in English. It’s likely to be completed late next year, and the new company will control more than a quarter of the global book trade. The number of major publishing houses will go from six to five, with credible predictions that it could easily go down to three. (Some in publishing note grimly that the publishers chose to announce this on Monday, Oct. 29, a day when the storm – which saw many editors and agents stranded at friends’ and relatives’ houses, without phone connections or power — would make meaningful news coverage almost impossible.)
The get-big-or-go-home strategy may allow bulked-up publishers to stand up to Amazon, which has become the industry’s Goliath. “The book publishing industry is starting to get smaller in order to get stronger,” the New York Times judged.
Lke a lot of publishing folks, Jonathan Galassi, publisher and president of Farrar, Straus and Giroux, doesn’t know quite how to read all this. But it’s significant: “Publishing is going through a sea change,” he tells Salon. “It’s going to be different when it comes out.” Whatever else is happening, “It feels like a contraction to me.”
That, after all, is what they always say.
But the implications are larger. If you work in, say, journalism, or the music business, you’ve seen this kind of thing before: the erosion and then collapse of an industry, often after mergers and acquisitions announced with buzzwords – “synergy”! – or reassurances that new ownership means that nothing significant will change because, after all, we really value the kind of work you people do. Will publishing continue to slide, gradually, or will it fall apart, like newspapers – which have lost approximately a third of their staffs since the recession and seen advertising revenue sink to 1953 levels — and record labels – where annual sales of the top-10 albums have gone from over 60 million to about 20 million in roughly a decade. Members of the creative class have been here, and it hasn’t worked out real well for them.
“It’s really painful,” says Ira Silverberg, a veteran editor (Grove/Atlantic, Serpent’s Tail) and agent (Sterling Lord Literistic) now serving as director of literature for the National Endowment for the Arts. ”I’m sure I’ll have tons of former colleagues looking for work, and they won’t find it. Regardless of what [executives] say, it’s going to be a smaller business.”
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Publishing has seen various kinds of corporate mergers and acquistions going back three or four decades, as independent or family-owned companies have been absorbed by corporate masters. Random House, the largest and perhaps most prestigious American publisher, was bought in 1998 by the German company Bertelsmann. Things have been reasonably quiet since then.
So why is this larger shift happening now?
It’s no secret that the recession and slow-growth economy – and the long-standing flattening of middle-class wages that predates it – has bled nearly all cultural entities and venues. The process can be cumulative: Every time an independent bookstore closes, it makes things a little more difficult for publishers; when a chain, like Borders — which helped put those bookstores out of business — itself tanks, it makes things a lot harder.
But the biggest issue is digital technology – e-books, Amazon, Kindles — which has put downward pressure on author advances, which now stand, by some estimates, at about half of what they were just four years ago. The digital revolution has effectively marginalized traditional publishers, as the center of financial gravity shifts from Manhattan to Silicon Valley and Seattle. “Like record labels, publishers have become arms suppliers in the cold war between technology companies,” Robert Levine writes in his 2011 book “Free Ride,” about the Internet’s damage to the culture business.
Full piece at Salon