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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Against the Law: Peter Wildeblood must be one of the bravest men who ever lived

BBC2's historical gay rights film evokes bewilderment, fear and agonising pain.

My head told me that Against the Law (26 July, 9pm), the BBC’s film about Peter Wildeblood, the only openly gay man to give evidence to Lord Wolfenden’s committee, wasn’t up to much. Wildeblood was one of the three men who in 1954 were convicted of buggery in the notorious Montagu case (the others being Lord Montagu of Beaulieu and his cousin Michael Pitt-Rivers) – a trial that led, thanks to unease about the verdict, to the inquiry that resulted in the Wolfenden report, which in 1957 recommended the decriminalisation of homosexuality in Britain.

The film is based on the book Wildeblood published (he was a journalist) after his release from Wormwood Scrubs. Its script, by Brian Fillis, was underpowered and off-puttingly didactic, and I couldn’t understand, at first, the decision to keep interrupting the drama with the spoken-to-camera recollections of a series of elderly gay men. But at some point my heart, which was aching, told my head to shut up. This is… good enough, I thought, watching the film’s last few moments, in which the 89-year-old Roger and the 77-year-old Percy tenderly kissed for the camera. I was mad for Roger. Did he remember Wolfenden? My dear, how could he ever forget it? At the time, he was having an affair with Lord Wolfenden’s son, Jeremy, which certainly added piquancy to the newspaper reports as he read them over breakfast.

If I’d been casting this piece, I might have gone for a floppy-haired Matthew Goode type for Wildeblood, the former public school boy – but that would have been my mistake. It’s hard to imagine a finer performance than the one given by Daniel Mays, an actor who is not even remotely floppy haired.

Here was all of the wit and compassion you find in Wildeblood’s prose, combined with emotions I’d hitherto only been able rather half-heartedly to imagine: bewilderment, fear, agonising pain. As Wildeblood watched his former lover, an RAF corporal called Edward McNally, turn Queen’s evidence during his trial, May’s face grew slack with disbelief. He looked, to me, as if some unknown hand was quietly disembowelling him. By which had he been most betrayed? Love, or the law of the land?

Everyone knows what followed, but it was horrible to see nevertheless. Mailbags were sewn; aversion therapy was discussed (the prison shrink, played with viper-like precision by Mark Gatiss, told Wildeblood he could either receive a series of electric shocks or a drug that would make him vomit for two days). I thought, not for the first time, that Wildeblood must have been one of the bravest men who ever lived – though it’s not as if he wanted for company: the director’s talking heads, silver of hair and soft of jowl, reminded us of this at every turn, and I was glad of the human punctuation they provided. For most of us, this stuff is history. For them, it had been life.

Some people are devoted to newts, and others to hobbits; a few enjoy recreating the battles of the Civil War. The film My Friend Jane (17 July, 7pm) got down and not very dirty with the Austen super-fans, by which I mean not those who have read Sanditon and The Watsons but types who like to dress in full Regency garb and dance to the sound of a spinet come Saturday night. Actually, it’s scarier than this. A former doctor, Joana Starnes, breathlessly described her new career as a writer of “top-tier JAF”. Translated, this means highly superior Jane Austen fan fiction. She’s produced seven JAF novels, which sounds like a lot until you discover that 60 come out every month.

Zack Pinsent, meanwhile, who is 22, makes his living as a period tailor in Hove, where he likes to promenade in fall-front trousers – a flap enables the gentleman thereby to pee – and top hat. I wanted to laugh at him, and all the other empire-line eccentrics in this odd little documentary. But there was something touching about their obsession; at least they didn’t attempt to intellectualise it, unlike those literary fan girls who have lately taken to writing entire books about why their lives would be meaningless without this or that great writer for company. 

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 27 July 2017 issue of the New Statesman, Summer double issue