did you know?
The world’s only venomous mammal is the slow loris.
Pick up a Penguin
Written by Charlie Clegg, senior associate
Edited by Adam Shaw, associate partner
3 November 2021
The world’s largest living thing is the Pando, which covers 108 hectares of Utah. On the ground, it seems like a forest of 40,000 individual aspen trees but is actually one organism of interconnected roots. The publishing industry is similar.
To the reader, most books appear to come from a collection of independent brands. In reality, the “publishing houses” of the vast majority of English-language popular books are imprints of one of five big publishers: Penguin/Random House, Simon & Schuster, Macmillan, HarperCollins, and Hachette.
Until this week, this number looked set to reduce to four with the planned merger of Penguin/Random House and Simon & Schuster. Yesterday, however, the US Department of Justice (DOJ) intervened in an attempt to block this change. The department is now suing to prevent Penguin/Random House’s parent company Bertelsmann from acquiring Simon & Schuster, itself a subsidiary of Viacom CBS.
Acquisitions and mergers in publishing have accelerated since the millennium. Penguin/Random House was itself formed by the merger of its namesakes as recently as 2013. One of the driving factors which Penguin/Random House cited in favour of the merger is the need for the industry to strengthen its bargaining position with the US’s largest bookseller, Amazon.
The UK’s Competition and Markets Authority had cleared the merger in the spring. For the US, however, this is the first major antitrust case under the Biden presidency and it could set the tone for how the administration will handle further threats of monopolies. The decision is not, however, solely political. The DOJ’s asserts that this was a merger too far.
Despite boosts in bargaining power, mergers bring with them the rationalisation of staff and the consolidation of imprints. They can also weaken the positions of authors, for whom there are fewer potential publishers with which to negotiate. Some industry figures had hoped HarperCollins would take over Simon & Schuster and provide a bulwark against the growing dominance of Penguin/Random House. The US government’s decision has been good news for Penguin/Random House’s rivals.
Outside these mergers, the publishing world has other issues to tackle: the now massive income discrepancy among authors and frequently wasteful business practices among them. Whether this attempt to block another major merger is going to reverse such trends remains to be seen.
At Cop26 yesterday, leaders announced two major agreements to curb contributors to climate change. The first aims to end and reverse deforestation by 2030 and has been supported by countries with major tracts of forest, including Brazil and Indonesia. Activists have, however, criticised the deal for a lack of focus. The second aims to slash 30% off 2020 rates of global menthane emissions by 2030.
Tory MPs are expected to overturn a ruling of Westminster’s standards committee against Owen Paterson, the MP for North Shropshire. Paterson, a former Conservative cabinet minister, had been found in breach of lobbying rules and was due to receive a 30-day suspension from the Commons. Tory whips are now, however, instructing their MPs to back the creation of a new committee to investigate Paterson.
Republican challenger Glenn Youngkin looks set to beat Democrat incumbent Terry McAuliffe for the governorship of the US state of Virginia. This would be a major upset in a state that backed Joe Biden by 10 percentage points in last year’s presidential election. Other results from elections in the US on Tuesday include the elections of the first black mayor of Pittsburgh, Ed Gainey, and the first Asian-American mayor of Boston, Michelle Wu.
Business and economy
For the US Democrats, the presidential succession seems clear: Joe Biden stays on till 2024 and is replaced as nominee, then as president, by his current vice president, Kamala Harris. In the Financial Times, Janan Ganesh claims such a plan is typical of the establishment thinking which has long hindered the party. The next Democratic nominee could again face Donald Trump. In a contest that could be existential for US democracy, Ganesh argues the Democrats must look beyond its top two office-holders if it is to be sure of winning. (£)
Last month, it was announced that Frank Field – the crossbench peer and former Labour MP – was dying. In a tribute in The Times, Daniel Finkelstein looks back on Field’s 40 years as an MP. Field, Finkelstein believes, was one of the last politicians who embodied the foundational relationship between the British Labour movement, Christianity, and patriotism. Finkelstein claims a similar combination could yet help Sir Keir Starmer’s party. (£)
Columns of note
In the Financial Times, Bill Gates welcomes the leap in clean energy innovation we’ve made over the past six years and eloquently argues that the pace at which we embrace energy innovation will make or break our fight to curb climate change. The only obstacle for the climate innovation agenda is pace: while producing clean energy is possible, doing it at scale, thus lowering costs for consumers, and doing it fast, thus capitalising on public attention, are still works in progress. (£)
In The Guardian, David Wengrow echoes Gates’ emphasis on innovation, albeit from the point of view of mankind’s history. Wengrow ties our shared history as a story of communal innovation, one we should tap in order to move forward and find solutions to reverse the effects of climate change. Asking everyone to participate in climate action is not because of the magnitude of the crisis we face, the author purports. Instead, it’s “asking us to reclaim the spark of political creativity that gave life to the world’s first towns and cities, in the hope of discerning a future for the planet we all share.”
What happened yesterday?
Wall Street made gains yesterday as investors cheered a quarterly earnings season that has exceeded analysts’ expectations and amid speculation that the US Federal Reserve’s will announce a scaling back of its pandemic-related stimulus programme at its meeting this week.
The S&P 500 closed up 0.4%, the Dow Jones Industrial Average gained 0.39%, and the Nasdaq Composite rose 0.3%.
In Europe, the Stoxx 600 closed up 0.1%, reaching another all-time high, while the FTSE 100 and FTSE250 dropped 0.19% and 0.31% respectively.
Sterling was trading at 1.18 euros and at 1.36 dollars.
In company news:
Pfizer expects to make sales worth $36bn of the Covid vaccine this year and has forecast another $29bn in sales in 2022, topping analysts’ estimates.
Tesla shares dropped by more than four per cent in pre-market training as the car marker’s founder, Elon Musk, suggested a planned deal between his company and rental firm Hertz had not been finalised.
Maersk reported a 68% jump in revenue to a record $16.61bn in the third quarter; the transport company did, however, warn global supply bottlenecks showed no signs of easing.
What’s happening today?
Braemar Shipping Esken Ltd Trainline
UK economic announcements
(07:00) Nationwide House Price Index
International economic announcements
(09:00) Unemployment Rate (EU)
(11:00) MBA Mortgage Applications (US)
(14:00) Factory Orders (US)
(14:30) Crude Oil Inventories (US)
(14:45) PMI Composite (US)
(14:45) PMI Services (US)
(15:00) ISM Prices Paid (US)
(15:00) ISM Services (US)
The world’s only venomous mammal is the slow loris.
Share this post