Penguin Random House CEO has resigned

Penguin Random House chief executive Markus Dohle has resigned: he will leave the group, the largest book publisher in the world, at the end of the year due to the failure to acquire competitor Simon & Schuster.

Penguin Random House is the first of the so-called “Big Five”, “Big Five”, of world publishing. In the last two years he had tried to buy Simon & Schuster, another of the Big Five, but the merger had been opposed by the administration of US President Joe Biden, resorting to to a federal court. On October 31 a judge he had proved the US government right establishing that the acquisition would substantially damage competitiveness in the publishing market. Bertelsmann, the German multinational company that owns Penguin Random House, later announced on Nov. 21 that it had backed out of the acquisition after Paramount Global, the company that owns Simon & Schuster, essentially backed out.

Dohle, who is German, had led Penguin Random House since 2013, that is, since the group was formed from the merger of Penguin and Random House; he was previously the head of Random House and had worked for Bertelsmann since 1994. He himself cited the failure of the merger with Simon & Schuster as the reason for his resignation. From January 1 to lead the interim group will be Nihar Malaviya, current chief operating officer of the US division of Penguin Random House.

The reason why the merger with Simon & Schuster was blocked is that the merger of the two large publishing groups would have created a monopsonythat is, a situation in which a company has too much power over its suppliers, in this case the book authors, and therefore can force them to accept lower fees. The problem would have mainly affected the highly successful writers, those who sell millions of copies and make more than $ 250,000 for a book: the publisher resulting from the merger of Penguin Random House and Simon & Schuster would have dominated half of their market.