The merger of publishing giants should concern us all
Following a roller-coaster year of supply chain disruption and cash flow challenges, the sale of Simon & Schuster to Bertelsmann, a German conglomerate, is another worry keeping independent publishers up at night.
The imminent concentration of power in the publishing industry will have long-lasting repercussions for Canadian literary culture.
Pending regulatory approval, the deal will result in the merger of Penguin Random House Canada (PRH, owned by Bertelsmann) and Simon & Schuster Canada. Their combined resources and infrastructure will overshadow all other publishers operating in our market, with a combined market share exceeding 50 per cent by some estimates.
It is difficult to imagine how this will benefit our writing and publishing ecosystem or Canadian readers.
Consolidation in book publishing is not new. This sale is the latest in a string of mergers and acquisitions that have created a highly concentrated marketplace.
Book retail and wholesale have experienced similar trends. The results are significant barriers to market for independent publishers, fewer houses to which writers can present their manuscripts, and the entrenchment of a blockbuster culture focused only on the most likely bestsellers.
Some will argue that the merger is essential for Simon & Schuster and PRH to compete against Amazon. Many Canadians will perceive it to be a done deal, or one that will only be halted by decisions made in the United States.
The book trade has been vocal in opposing the sale, and time will tell whether U.S. regulators take a stand. In Canada, the Writers’ Union has joined the Association of Canadian Publishers in calling for a thorough review.
Despite initiation of the deal outside our borders, Canada has tools it could use to put Canadian cultural objectives first. The Competition Bureau is one avenue, though it is also worth revisiting the Investment Canada Act, which includes regulations on foreign investment in book publishing, retail and distribution.
Canadian-owned publishers view the implementation of those regulations as having been so poor, that defining meaningful “net benefit” to Canada in the context of this transaction is almost impossible.
Under what conditions can the merger of two of the world’s largest publishers, and all that means for market access and audience development, be considered beneficial?
One would need to start by rolling back the clock.
A series of exceptions to the policy has brought us to this point. Storied Canadian publisher McClelland & Stewart was sold to Random House in stages between 2000 and 2011. Simon & Schuster was permitted to establish a publishing program in 2013, the same year Penguin and Random House merged.
We now face another takeover, which will bring Simon & Schuster into PRH’s already large tent. It remains to be seen how its editorial program will live alongside PRH’s many imprints, or how many jobs will be lost.
Canada enjoys an abundance of literary talent, from writers who have honed their craft for decades to those just bursting onto the scene. That diversity of voices makes each season more exciting than the last.
This dynamic mix of books is contingent on the existence of a multiplicity of publishing houses, with varied editorial mandates, missions, and political views.
To thrive, companies large and small must be able to build audiences for authors and earn adequate revenue to invest in new content.
A market dominated by a behemoth doesn’t create those conditions, to the detriment of all participants in the supply chain, from writer to reader.
The surrender of our publishing landscape pushes important Canadian voices to the margins. Small and mediumsized Canadian houses publish the majority of Canadian authors, including those from BIPOC and other marginalized communities and those telling local stories.
To continue that work, they need conditions that allow them an appreciable footprint in the marketplace.
Minister of Canadian Heritage Steven Guilbeault has proven himself to be a champion of Canadian creators and cultural industries. In leading the charge on reform of the Broadcasting Act and regulating the web giants, Guilbeault has put Canadian content first, despite pressure from global players. Books should be no different.
Now is the time to boldly and creatively use our policy tools to create the conditions that will allow Canadian writers and publishers to thrive.