Penguin Random House CEO Markus Dohle, in his first statement on the US District Court’s ruling against PRH’s proposed acquisition of Simon & Schuster. Dohle spoke at the Sharjah Publishers Conference on the eve of the United Arab Emirates’ Sharjah International Book Fair. Image: Publishing Perspectives, Porter Anderson
By Porter Anderson, Editor-in-Chief | @Porter_Anderson
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Dohle: ‘This Morning I’m Super-Disappointed’
SHARJAH, United Arab Emirates—”I think the ruling is utterly wrong,” Penguin Random House’s worldwide CEO Markus Dohle has said today (November 1) about Judge Florence Yu Pan’s order in the United States, blocking the Bertelsmann/Penguin Random House attempt to acquire Simon & Schuster for US$2.175 billion.
As Bodour Al Qasimi, president of the International Publishers Association‘s (IPA) neared the end of an onstage interview with Dohle, she broached “the elephant in the room”—the question of the ruling. (Our overnight story on the court’s decision is here.)
Until Dohle’s scheduled appearance, arranged by Ahmed Al Ameri‘s Sharjah Book Authority, the producer of the 12th Sharjah Publishers Conference, members of the media had received only last evening’s brief but emphatic statement from Penguin Random House, disagreeing with Judge Pan’s ruling.
Al Qasimi told Dohle, “I’d love to hear your counter-argument” to the US Justice Department’s position that the proposed merger “would have reduced competition, decreased author compensation, diminished the breadth, depth, and diversity of our stories and ideas, and ultimately impoverished our democracy.”
When Al Qasimi raised the issue, Dohle was typically affable, joking, “There are no lawyers in the room?” and eyeballing a familiar journalist to say, “You’re not going to record this, right?”
He grinned and asked Al Qasimi, “Do you have a job for me? I’m not sure that after I answer, I can return to the United States.”
And then he launched into his answer, his demeanor changing quickly.
‘It Was a Tough Night’
Marcus Dohle and Bodour Al Qasimi at Sharjah Publishers Conference, November 1. Image: SIBF, Nabs Ahmedi
A man of articulate, animated candor when he speaks—it’s one reason that publishing audiences, like journalists, always enjoy hearing him—Dohle made it clear that Judge Pan’s ruling, however expected it may have been, has arrived as a deeply felt gut punch to the leadership of the world’s largest publishing house.
“I’m biased and I’m very disappointed,” Dohle said. “And it was a tough night.”
Here are Dohle’s remarks to a gathering of several hundred international publishers and translation-rights specialists on the third and final day of the 2022 Sharjah Publishers Conference:
“We [Penguin Random House] are—and we’ve always been—very good industry citizens.
“And the idea of bringing Simon & Schuster together with Penguin Random House is a very simple idea. In publishing, we support writers one story at a time, one writer at a time. There is no ‘scale’ on the publishing side.
“We are a community of 325 imprints and we work on one story and one author at a time—one editor being passionate about one manuscript or book idea at a time. … There is no scale.
“We at Penguin Random House have invested a lot into distribution, global distribution, local distribution, to actually sell more of our authors’ works, and we were convinced from the get-go, that we can sell more of Simon and Schuster’s authors’ books than they sell today because of our $250 million investment in the US alone in the last 10 years, into our supply-chain distribution, [at a time] when print is still the prevailing format.
“So the idea was very clear. If Simon & Schuster comes to us, we just bring two communities of publishing houses into one community of publishing houses.
“By the way, 10 years ago, we did the same with Penguin Random House, and everyone says we’ve done a good job … becoming one community of imprints and then trying to maximize readership and distribution, domestically and globally.
“Readers would have benefited from this merger because we sell our books through more retailers than anybody else in 20,000 retail locations in the US, 160,000 retail locations globally … Authors would have been benefiting because of more royalties, because of more sales, and their agents [would benefit], of course, too. And ultimately, because of our synergies, we would have paid more taxes, so the taxpayer would have been benefiting.
“So it was good for our constituencies. And, by the way, we’ve lost some market share. So Simon & Schuster is basically refilling lost market share for us, and after the merger, we would have been less than 20 percent of the United States’ trade [book publishing], market less than 20 percent—while Amazon is 50 percent of the retail side.
“So to challenge this is a very unfortunate part of the political agenda. … We are going to think about an appeal because we think we’re on the right side. … This morning, I’m super-disappointed. I think the ruling is utterly wrong.”
Penguin Random House CEO Markus Dohle speaks on November 1 with International Publishers Association president Bodour Al Qasimi at the Sharjah Publishers Conference in the United Arab Emirates on the eve of the Sharjah International Book Fair. Image: SIBF, Nabs Ahmedi
More from Publishing Perspectives on Simon & Schuster is here, more from us on Bertelsmann is here, and more on Penguin Random House is here. More on mergers and acquisitions in publishing is here.
Publishing Perspectives is the global media partner of the International Publishers Association.
More on the still-ongoing coronavirus COVID-19 pandemic and its impact on international book publishing is here.