A publishing powerhouse

Could a merger between Penguin and Random House stop Amazon in its tracks?

After the FT reported that talks had been held between two of the world’s “big six” publishers, Penguin and Random House, an official statement has finally been made. Pearson, the UK-listed education specialist (and the world’s single largest book publisher), who owns both Penguin and the FT, released the following announcement: “Pearson confirms that it is discussing with Bertelsmann a possible combination of Penguin and Random House. The two companies have no reached an agreement and there is no certainty that the discussion will lead to a transaction. A further announcement will be made if and when appropriate.”

Random House is owned by the German media conglomerate Bertelsmann, whose ill-fated merger with Sony (creating Sony-BMG) has left them anxious to take the lead on any potential deal. Thomas Rabe, Bertelsmann’s chief executive, commented on the “pitfalls of putting creative businesses together”, which mean that one side must take ultimate control. “We have the ambition to lead,” he said.

A merger between the two companies – whose brands, it should be noted, are distinct and unlikely to be hastily dissolved – would create a 25 per cent market share, large enough to come under scrutiny from the OFT and Competition Commission. A second factor which may hinder a potential merger is the ongoing allegations of price-fixing in the US, a suit which Penguin has repeatedly contested.

The elephant in the room, as ever, is Amazon. The internet retailer, whose UK business operates from the company’s base in Luxembourg, continues to plough millions into its ebook infrastructure despite huge losses. Described by Waterstones head James Daunt as a “ruthless, money-making devil” and of “using authors as a financial football” by Curtis Brown chairman Jonathan Lloyd, the company facilitates and encourages self-publishing, which perhaps signals the endgame of their repeated attempts to undermine present publishing models. “Penguin House” may just have the reputation, power and resources to stop the internet giant in its tracks.

Phil Jones, editor of the publishing trade magazine The Bookseller, said: “The merger of Penguin and Random house would create a powerhouse of a consumer publisher across books, ebooks and apps.” Analyst Lorna Tilbian from Numis Securities concurs: “Consolidation is the order of the day,” she said. “Technology and tablet computers have given it extra momentum. They [publishers] have got to gang together to have enough clout to take on the technology giants that have transformed the industry.”

Update: This morning the merger between Penguin and Random House was confirmed. Check out The Bookseller for more information.

Berthold Lubetkin's Penguin Pool at London Zoo (Photograph: Getty Images)

Philip Maughan is a freelance writer in Berlin and a former Assistant Editor at the New Statesman.

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Would the BBC's Nazi drama SS-GB have felt half so resonant a year ago?

This alternate history is freighted with meaning now we're facing the wurst-case scenario. 

Would SS-GB have felt half so resonant a year ago? Though the clever-after-the-fact Nostradamus types out there might disagree, I can’t believe that it would. When it comes to the Second World War, after all, the present has helpfully stepped in where memory is just beginning to leave off. The EU, in the process of fragmenting, is now more than ever powerless to act in the matter of rogue states, even among its own membership. In case you hadn’t noticed, Hungary, for instance, is already operating as a kind of proto-fascist state, led by Viktor Orbán, a man whom Jean-Claude Juncker, the president of the European Commission, jokingly likes to call “the dictator” – and where it goes, doubtless others will soon follow.

The series (Sundays, 9pm), adapted from Len Deighton’s novel, is set in 1941 in a Britain under Nazi occupation; Winston Churchill has been executed and the resistance is struggling to hold on to its last strongholds in the countryside. Sam Riley plays Douglas Archer, a detective at Scotland Yard, now under the control of the SS, and a character who appears in almost every scene. Riley has, for an actor, a somewhat unexpressive face, beautiful but unreadable. Here, however, his downturned mouth and impassive cheekbones are perfect: Archer, after all, operates (by which I mean, barely operates) in a world in which no one wants to give their true feelings away, whether to their landlady, their lover, or their boss, newly arrived from Himmler’s office and as Protestant as all hell (he hasn’t used the word “degenerate” yet, but he will, he will).

Archer is, of course, an ambiguous figure, neither (at present) a member of the resistance nor (we gather) a fully committed collaborator. He is – or so he tells himself – merely doing his job, biding his time until those braver or more foolhardy do something to restore the old order. Widowed, he has a small boy to bring up. Yet how long he can inhabit this dubious middle ground remains to be seen. Oskar Huth (Lars Eidinger), the new boss, is keen to finish off the resistance; the resistance, in turn, is determined to persuade Archer to join its cause.

It’s hard to find fault with the series; for the next month, I am going to look forward to Sunday nights mightily. I would, I suppose, have hoped for a slightly more charismatic actress than Kate Bosworth to play Barbara Barga, the American journalist who may or may not be involved with the British resistance. But everything else seems pretty perfect to me. London looks suitably dirty and its inhabitants’ meals suitably exiguous. Happiness is an extra egg for tea, smoking is practically a profession, and
the likes of Archer wear thick, white vests.

Swastikas adorn everything from the Palace of Westminster to Trafalgar Square, Buckingham Palace is half ruined, a memorial to what the Germans regard as Churchill’s folly, and the CGI is good enough for the sight of all these things to induce your heart to ache briefly. Nazi brutality is depicted here as almost quotidian – and doubtless it once was to some. Huth’s determination to have four new telephone lines installed in his office within the hour is at one end of this horrible ordinariness. At the other is the box in which Archer’s mutinous secretary Sylvia (Maeve Dermody) furiously stubs out her fag, full to the brim with yellow stars.

When I first heard about The Kettering Incident (Tuesdays, 12.20am; repeated Wednesdays, 10pm) I thought someone must have found out about that thing that happened one time I was driving north on the M1 with a more-than-usually terrible hangover. Turns out it’s a new Australian drama, which comes to us on Sky Atlantic. Anna (Elizabeth Debicki), a doctor working in London, pitches up back in Tasmania many years after her teenage friend Gillian disappeared into its Kettering forest, having seen a load of mysterious bright lights. Was Gillian abducted by aliens or was she, as some local people believe, murdered by Anna? To be honest, she could be working as a roadie for Kylie, for all I care. This ponderous, derivative show is what happens when a writer sacrifices character on the altar of plot. The more the plot thickens, the more jaw-achingly tedious it becomes.

Rachel Cooke trained as a reporter on The Sunday Times. She is now a writer at The Observer. In the 2006 British Press Awards, she was named Interviewer of the Year.

This article first appeared in the 24 February 2017 issue of the New Statesman, The world after Brexit