In a signal that the Justice Department is serious about enforcing its antitrust laws against potential large mergers, DOJ has sued to block a deal for ViacomCBS to sell assets to a direct competitor, but in this case it is the entertainment giant's Simon & Schuster book publishing subsidiary.
Penguin Random House had struck a deal to buy Simon & Schuster for $2.175 billion, but DOJ said that would create a "behemoth" that would harm authors and consumers.
Penguin Random House is the world's largest publisher.
Also: AG Garland Pledges Strong Antitrust Enforcement
DOJ said that such a horizontal merger--between direct competitors--would decrease the competition for content, resulting in lower prices paid to content producers and less choice for consumers, in this case manuscripts but the same argument DOJ has made against mergers of other content distributors.
“In stopping Penguin Random House from extending its control of the U.S. publishing market, this lawsuit will prevent further consolidation in an industry that has a history of collusion,” said acting Assistant Attorney General Richard A. Powers. “I want to thank the Attorney General and senior leadership of the department for their support of antitrust enforcement.”
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Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.