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.

JOHN OGILBY/PRIVATE COLLECTION/BRIDGEMAN IMAGES
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Why did Britain's first road atlas take you to Aberystwyth?

Alan Ereira's new The Nine Lives of John Ogilby tells the story of a remarkable book – and its remarkable creator.

John Ogilby was a talented dancer with a bright future. Performing at White Hall Palace in February 1619, the 18-year-old leapt higher than ever to impress the watching James I and his queen. But then, crashing to the floor with a torn ligament, Ogilby never danced again. It was one of many misfortunes he overcame in a remarkable life. He went on to become a theatrical impresario, the deputy master of the revels in Ireland, a poet, a translator and a publisher of ancient classics. He even organised the public celebration of Charles II’s coronation. He was also an accomplished soldier, sailor and spy, as Alan Ereira reveals in this entertaining account of his “lives” and times.

It was a remarkable collection of lives for a man born in Scotland in 1600 and raised in poverty, the illegitimate son of an aristocrat. Yet Ogilby’s greatest achievement was to put Britain on the map when he was appointed “His Majesty’s Cosmographer and Geographick Printer” in 1674. His Britannia is the first detailed road atlas ever made. It opens with a map of England and Wales showing, he wrote, “all the principal roads actually measured and delineated”. It contains a hundred or so beautifully engraved plans of roads as winding ribbons sliced into sections. Rivers, forests, villages and bridges are included as landmarks.

Embracing the new science of measurement and experiment championed by the Royal Society, Ogilby’s surveyors used a wheel with a circumference of 16ft 6in and a handle that allowed it to be pushed along, as well as a clock face that recorded journey distances. With no universally agreed length of a mile, Ogilby chose 1,760 yards. Britannia led to the accurate measurement of almost 27,000 miles of tracks, paths and roads, though only about 7,500 are depicted in the atlas at one inch to the mile.

Britannia was published in September 1675. There were few who could afford it, at £5 (roughly £750 in today’s money), and it was too heavy to carry. Instead, travellers found their way around the country by following printed itineraries, with lists of the towns to pass through on any particular journey.

Britannia is not, as Ereira explains, an atlas of commercially useful roads of the day. The first journey is an odd one, from London to Aberystwyth, then a town of fewer than 100 houses and a ruined castle. Some of the roads chosen were no longer in use, while important routes such as those to Liverpool and Sheffield were left out.

But the choice of roads in Britannia begins to make sense as being those necessary for the royal mastery of the kingdom. The London to Aberystwyth road led to mines nearby. In the days of Charles I those mines contained lead and silver that helped the king pay his soldiers during the civil war. Britannia was a handbook, Ereira explains, for a conspiracy leading to a new kingdom under a Catholic king.

Ever since the start of the Reformation, Europe had been rumbling towards a religious war. When it came on the mainland it lasted 30 years and left millions dead. The subsequent Peace of Westphalia led to a new map of Europe, one of countries and defined frontiers instead of feudal territories with unclear borders and independent cities. England was not included in the peace but shared in its vision of separate sovereignty. This led to different results in different places. In France, the king became an all-powerful despot; in England it was the ruler who lost power as parliament emerged triumphant.

In 1670 Charles I’s son Charles II decided to throw off the restraints he had accepted as the price of his restored monarchy. He wanted to be the absolute master in his land. To achieve this, he entered into a secret treaty with the French king Louis XIV. Charles needed money, an army, allies to execute his plan, and detailed knowledge of the kingdom; Louis was willing to bankroll the venture as long as Charles converted to Catholicism. Britannia was a vital part of Charles’s strategy to assert military control: he would use it to help land and deploy the 6,000 French troops that Louis had promised him to assist his forces. The pact remained a well-kept secret for nearly a century, even though it soon fell apart when the French and British got bogged down in a war with the Dutch.

No matter. Ogilby died in September 1676 and in 1681 Charles II dissolved parliament for the last time during his reign. “Britannia provided an extraordinary grasp over the business and administration of the 399 communities that it identified in England and Wales, and the crown took a grip on them all,” Ereira writes.

In this way, the atlas played a significant part in enabling the king’s revenue to grow by one-third within a few years. No longer needing financial help from Louis, Charles ruled by divine right, exercising absolute power until his death in 1685. The lesson of Britannia was that whoever controls the map controls the world.

Manjit Kumar is the author of “Quantum: Einstein, Bohr and the Great Debate about the Nature of Reality” (Icon)

This article first appeared in the 12 January 2017 issue of the New Statesman, Putin's revenge