Stephen King Speaks Out Against The $2 Billion Penguin Merger
In the trial that will decide if Penguin Random House can buy Simon & Schuster, Mr. King said, “Consolidation is bad for competition.”
The Justice Department filed a lawsuit on Tuesday to stop Penguin Random House from buying Simon & Schuster. Best-selling author Stephen King testified in the case, saying that the merger of two of the country’s biggest publishers would make it harder for writers to make a living.
Mr. King testified as a witness for the government, which has sued to stop the $2.18 billion purchase in U.S. District Court for the District of Columbia.
The companies are some of the biggest of the so-called “Big Five” publishers, and they are part of an industry that has already been changed by mergers and acquisitions. The German company Bertelsmann owns Penguin Random House, which was made possible by a merger in 2013.
Mr. King said that he agreed to testify because “consolidation is bad for competition.”
Penguin Random House says that the authors and readers would benefit from the purchase. Its lawyers say that if the deal goes through, the authors of Simon & Schuster would be able to use Penguin Random House’s supply chain and distribution networks. They also say that the money saved by combining the two companies would be used to pay authors more.
Lawyers for the government used Mr. King’s testimony to show how consolidation in the publishing industry hurts authors and the industry as a whole.
The famous author of books like “It” and “Pet Sematary” testified in a grey suit and grey slip-on walking shoes. Sometimes the people in the courtroom’s gallery laughed when he said something. After Mr. King had testified for about half an hour, lawyers for Penguin Random House decided not to question him further.
The head of Hachette (one of the Big 5 publishers) doesn't have a problem with the Big 5 becoming the Big 4. He has a problem w/the biggest of the Big 5 (PRH) acquiring Simon & Schuster—and hopes Hachette might acquire S&S instead: https://t.co/ZjWibZCipz | @PublishersWkly
— Jane Friedman (@JaneFriedman) August 2, 2022
Mr. King said that when he started in the publishing business in the mid-1970s, there were hundreds of imprints, and he did not have an agent. Since then, he said, the number of publishers has gone down because competing businesses have been bought out or gone out of business.
He went on to say that because there are fewer publishers competing for business, advances have slowly gone down, especially for writers who haven’t sold many books before.
Not that advances, which are payments made to writers in advance based on how much they expect to make from royalties, were ever very generous for new writers. Mr. King said that his first two books, “Carrie” and “The Shining,” earned him a total of $10,000 in advances.
“Finding enough money to live on is getting harder and harder for writers,” he said.
In the years since then, Mr. King has written many best sellers and made a lot of money from them. He said that because he is financially stable, he can publish books with smaller, independent publishers. These are the kinds of publishers that new writers often go with to get their first books published.
He said that he took the smaller advances that independent publishers gave him because he wanted those imprints to stay in business.
He said, “If you’re very, very, very lucky, there comes a time when you can stop following your bank account and start following your heart.”