Who Will Bail Out the Publishers?

Last week, it came to book publishing, as it has to so many other industries. Simon & Schuster announced 35 layoffs; Penguin and HarperCollins ordered partial salary freezes; Houghton Mifflin Harcourt, having recently stopped buying books—which caused its publisher to quit—fired some more people and looked ripe for sale. And Random House’s new CEO, Markus Dohle, merged his five adult trade fiefdoms, which often competed for titles, into three. That means fewer books and lower advances (throw in Houghton Mifflin Harcourt, and that’s four fewer buyers than there were a year ago).

Big corporate publishing, like big everything else, has spent years expanding beyond the point of sustainability. It wasn’t slowing down fast enough in the face of rising printing costs, decreased market share, and fatally, plummeting sales this fall. Just last year, in a burst of irrational exuberance, Houghton Mifflin and Harcourt were merged by an Irish private-equity firm—a process that accrued massive debt. Their bills (along with the rest of Ireland’s) are coming due.

The big houses, HarperCollins, Penguin, and Simon & Schuster, will shrink to survive. Random House should have shrunk a long time ago: Think of it as General Motors, with an imprint for every type of book, a brand for every reader. And far too much overlap. What’s the difference between the books from Knopf and Doubleday, anyway? Maybe Bantam head Irwyn Applebaum could tell you why this duplication worked for the good of literature, but he just lost his job after 25 years at the company and saw his group absorbed. Random is now down to three main brands: mass Crown, middlebrow Random House (which ate Bantam), and high-end Knopf.

As for poor Houghton, its value to any buyer lies in its backlist: Roth, Grass, and Foer. That’s one thing book publishers have going for them. GM can’t start selling ’57 Bel Airs again.

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Who Will Bail Out the Publishers?