Speculation: e-book pricing from Random Penguin

[Doug Pardee]

The publishing world is all abuzz with Pearson's confirmation that it's in talks with Bertelsmann to merge Penguin with Random House. It's believed that Bertelsmann, Random House's overlord, would end up in control of the combined operation.

Random House sells e-books under the Agency model with Required Ebook Pricing, which forbids any booksellers from offering discounts. RH isn't a defendant in the Department of Justice lawsuit because that lawsuit isn't about Agency model pricing, and it isn't about Required Ebook Pricing; it's about illegal collusion which RH didn't participate in.

Three other publishing houses — Hachette, HarperCollins, and Simon & Schuster — have accepted a settlement in that lawsuit. That settlement requires, among other things, that Required Ebook Pricing and Most Favored Nation clauses be removed from their contracts with e-book retailers. Would Random House provide a shelter for Penguin, by moving Penguin's e-books over to RH contracts?

I'm thinking that might be a reason that these discussions are happening. It might even be a significant reason. Or maybe I've just got e-books on the brain, and it's really all about print books.

[Nathan Bransford]

Yeah, it would be interesting to see what would happen with this. Any time you're combining companies with as market share as these, it's going to attract antitrust scrutiny, and I'm guessing it's not going to be possible for Penguin to escape the settlement by hiding under Random's wing for books that were published before any potential merger. Going forward though, it will be interesting to see if Random Penguin would be bound by Random's rules or Penguin's. We shall see.

[TriciaLinden]

I believe the new name for the merged companies is expected to be Penguin Random House, however, I love that so many writers are already calling them Random Penguin. It may be a 'nickname' that sticks and stays. I'm in favor of Random Penguin. It's so evocative of their reality. As for their pricing model, if these established houses refuse to change their pricing model, sooner or later, customers will flow away to the best priced books. Oh, excuse me, that's already happening with ebook publishing.