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Weekly News Digest
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August 8, 2023 — In addition to this week's NewsBreaks article and the monthly NewsLink Spotlight, Information Today, Inc. (ITI) offers Weekly News Digests that feature recent product news and company announcements. Watch for additional coverage to appear in the next print issue of Information Today.
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Amazon Continues to Face Ebook Monopoly Claims
Andrew Albanese writes the following in “Judge Finds Revived Amazon E-Book Monopoly Suit Should Proceed” for Publishers Weekly:For a second time in two years, a magistrate judge in New York has recommended that a consumer class action lawsuit accusing the Big Five publishers of colluding with Amazon to fix e-book prices should be dismissed. But while the judge recommended tossing the case against the publishers, the court found that monopolization and attempted monopolization claims against Amazon should proceed. … While the monopolization claim against Amazon may now proceed, Amazon and the publishers have insisted claims of coordination or conspiracy are ‘implausible’ and unsupported by any evidence. And, as she did in her dismissal recommendation a year ago, [magistrate judge Valerie] Figueredo once again recommended tossing the case against the publishers, finding no evidence of coordination either among the Big Five publishers, or between the publishers and Amazon. Notably, the revised suits attempted to use evidence presented by the Department of Justice in its successful case blocking Penguin Random House’s acquisition of Simon & Schuster as evidence of potential collusive behavior, but Figueredo was unpersuaded. For more information, read the article.
Reactions to KKR's Acquisition of Simon & Schuster
The big news in book publishing right now is the sale of Simon & Schuster to private equity firm KKR for $1.62 billion. KKR also owns OverDrive. Here are some of the many news articles about the acquisition.The Guardian: “Simon & Schuster Sold to Private Equity Firm KKR for $1.62bn” Late in 2020, Paramount had announced the sale of Simon & Schuster to Penguin Random House …, a deal that would have made the new company by far the biggest in the US. But the Department of Justice, which under the Biden administration has taken a tougher stance on mergers compared to other recent presidencies, sued to block the sale in 2021. After a three-week trial in the summer of 2022, … US district judge Florence Y Pan ruled in the government’s favor, saying the [Department of Justice] had made ‘a compelling case that predicts substantial harm to competition’. Book Riot: “Simon and Schuster Is Being Sold to a Private Equity Firm for $1.6 Billion” After a Federal Court blocked Penguin Random House’s [PRH] acquisition of Simon and Schuster over antitrust concerns, the 99-year-old publishing company was put back up for sale by Paramount. Now, it’s being sold to the private equity firm KKR for $1.62 billion. The original sale to PRH was for $2.2 billion. The Conversation: “The Sale of Publisher Simon & Schuster Is Good News for Staff and Authors, but the Long-Term Implications Are Uncertain” This must be a huge relief for staff and authors. It brings to an end Paramount Global’s three-year search for a new owner for the publisher, which was no longer seen as a core business for the multinational media and entertainment conglomerate. … The New York-based publisher also comes with considerable cultural caché. Founded in 1924 by Richard L. Simon and M. Lincoln Schuster, the company is the fourth largest publisher in the United States. Publishers Weekly: “KKR Wins S&S for $1.62 Billion” $1.62 billion is a healthy price since most trade publishers sell for not much better than 1.5 times sales, and [Simon & Schuster]’s 2022 revenue was $1.18 billion. … A private equity firm’s acquisition will be viewed negatively by many who will be concerned that KKR will put profits over literature. Others, however, will see KKR’s as better than [Simon & Schuster] being bought by one of its competitors. CNBC: “Paramount to Sell Simon & Schuster to KKR for $1.62 billion; Media Giant’s Earnings Top Estimates” Paramount’s stock was up nearly 4% in after-hours trading [after the announcement]. Paramount executives said during [Aug. 7’s] earnings call that the proceeds of the Simon & Schuster sale would be used in the company’s ongoing effort to pay down debt. For more on Paramount’s approach to selling Simon & Schuster, see NPR’s “Paramount Sells Simon & Schuster to Private Investment Firm” and “Paramount to Sell Simon & Schuster to KKR for $1.62 bln” from Reuters. The Hollywood Reporter: “After Blocked Deal, Paramount Sells Simon & Schuster to Private Equity Firm KKR for $1.62B” In opting to sell to a buyer not affiliated with the ‘Big Five’ group of publishers—which includes prior suitor Penguin Random House along with HarperCollins, Hachette Book Group and Macmillan—Paramount appears to think this is the deal that can finally clear regulatory approval. The New York Times: “Paramount Agrees to Sell Simon & Schuster to KKR, a Private Equity Firm” The deal … will put control of the cultural touchstone behind authors like Stephen King and Bob Woodward in the hands of a financial buyer with an expanding presence in the publishing industry. While private equity investors have had a significant footprint in the book business—different firms have owned literary agencies, publishing houses and the retailer Barnes & Noble—the acquisition of one of the largest publishers in the country vastly increases the hold of financial interests in the business. For more on how a private equity firm owning a publishing company may affect its business, see “Simon & Schuster CEO Says There’s No Need to Be ‘Nervous’ About New Owner KKR” in the Los Angeles Times and the previously mentioned Publishers Weekly piece. Deadline: “It’s Official: Paramount Global Sells Simon & Schuster to KKR for $1.62 Billion in Cash” The company said that [after] the closing of the transaction, Simon & Schuster will become a standalone private company and will continue to be led by Jonathan Karp, President and CEO and Dennis Eulau, COO and CFO of Simon & Schuster. Variety: “Paramount Global, KKR Sign $1.6 Billion Deal for Simon & Schuster” KKR said it intended to extend Simon & Schuster’s domestic publishing program across various genres and categories, expand its distribution and spur growth in international markets. Employees will be given a chance to take part in an equity ownership program. Publishing Perspectives: “KKR Agrees to Buy Simon & Schuster for $1.62 Billion” [According to a statement,] ‘KKR will also support Simon & Schuster in creating a broad-based equity ownership program to provide all of the company’s more than 1,600 employees the opportunity to participate in the benefits of ownership after the transaction closes. Since 2011, KKR portfolio companies have awarded billions of dollars of total equity value to more than 60,000 non-management employees across more than 30 companies.’ For more on what employees can expect, see the previously mentioned article in The Conversation. Associated Press: “Simon & Schuster Purchased by Private Equity Firm KKR for $1.62 Billion” Simon & Schuster has had strong sales over the past two years, even as the book market has cooled off. The publisher has scheduled some of the most anticipated fall releases, including Britney Spears’ memoir ‘The Woman In Me’ and Walter Isaacson’s biography of Elon Musk. For a good quick-read summary of the sale, see Axios’ “KKR to Acquire Simon & Schuster for $1.62 Billion.”
How AI Could Affect the Publishing Industry
Elizabeth A. Harris and Alexandra Alter write the following in “A.I.’s Inroads in Publishing Touch Off Fear, and Creativity” for The New York Times:[P]ublishing is facing a new disruption that is likely to be … wide-ranging and transformative: the rise of artificial intelligence. Some in the publishing world are already experimenting with artificial intelligence programs in areas such as marketing, advertising, audiobook production and even writing, weighing their promise of supporting work done by humans against the threat that the machines may take over some of those jobs entirely. For others in the industry, the threat is already here. Writers have joined other artists, coders and content creators in suing A.I. companies, accusing them of using their work to train A.I. systems. … [T]he technology has the potential to reshape nearly every aspect of the work that goes into producing a book—even the act of writing itself. For more information, read the article.
PEN America Report Details the Dangers of Book Backlashes
PEN America announced the following:In a new report, Booklash: Literary Freedom, Online Outrage, and the Language of Harm, PEN America warns that social media blowback and societal outrage are imposing new moral litmus tests on books and authors, chilling literary expression and fueling a dangerous trend of self-censorship that is shrinking writers’ creative freedom and imagination. … The report argues that book withdrawals in the face of criticism—though relatively rare—have ripple effects, shrinking the space for risk-taking in literature and circumscribing what future books will be proposed and signed. … In addition, the report rejects ‘an identity-essentialist approach to literature: that writers can only responsibly tell the stories that relate to their own identity and experiences.’ … Drawing from months of research and dozens of conversations in the literary and publishing community–including with authors whose book contracts were canceled and editors who responded to calls to withdraw books from publication–the report includes in-depth accounts of many of the most contentious literary controversies over the past eight years. For more information, read the press release.
The Latest News From ALA
ALA has been especially busy this week. The following are links to three press releases from Aug. 8 and one from Aug. 9.ALA Upholds Its Support for LGBTQIA+ Library Workers and Reaffirms Its Commitment to Equity and Inclusivity: ALA “reaffirms its unwavering commitment to upholding the values of equity and inclusivity within libraries nationwide. In response to recent concerns surrounding discriminatory practices faced by LGBTQIA+ library workers, the ALA stands united in support of these dedicated professionals, advocating for a workplace free from prejudice and discrimination.” The organization “is taking proactive steps,” including establishing a task force “to develop a comprehensive strategy for addressing and tracking retaliatory employment cases against LGBTQIA+ library workers.” New Research Examines LGBTQIA+ Inclusive School Library Services for Youth: “[A newly] published research study from the American Association of School Librarians’ (AASL) peer-reviewed online journal, School Library Research (SLR), used systematic literature review methodology to examine international empirical research in the field of school and youth librarianship to identify and categorize published empirical research on LGBTQIA+ topics. Articles can be accessed for free at www.ala.org/aasl/slr.” Core Webinar: Best of Core at ALA Annual Conference; Thinking to Produce Results: “Join Core for the webinar ‘Best of Core at ALA Annual Conference: Thinking to Produce Results’ on August 29, 2023, at 1 p.m. CT. Try a proven strategy for streamlining your planning—as a librarian, manager, or administrator—so that your thought-process, discussions, and decision-making take less time and produce better results.” The cost is $57.67 for Core members, $71.10 for ALA members, or $79 for nonmembers. Register via the webinar’s webpage. AASL Commends Book Riot’s Weekly Censorship Roundup and Archives by Kelly Jensen: “Acting upon a resolution submitted by the Louisiana Association of School Librarians (LASL) the American Association of School Librarians (AASL) formally commends Book Riot’s Weekly Censorship Roundup and Archives by Kelly Jensen. The news roundup is one of twenty outstanding programs, events, and products recognized in 2023 for their support of the school librarian profession and the learners the profession serves.”
APA Discusses Equity and Inclusion in Higher Education
The American Psychological Association (APA) “reaffirm[s] its support for equity and inclusion in higher education in light of the U.S. Supreme Court’s ruling that bars the consideration of race as a factor in college and university admissions.”APA’s governing Council of Representatives passed a resolution on Aug. 2 stating that “the APA encourages higher education institutions to create, maintain, and increase equitable admissions policies that continue to examine the individual holistically. … The court’s decisions will worsen underrepresentation of certain racial and ethnic groups at higher education institutions that are not Historically Black Colleges and Universities (HBCUs).” For more information, read the press release.
Lifehacker Looks at How Phones Seem to Read Our Minds
Stephen Johnson writes the following in “Your Phone Isn’t Spying on You to Show You Ads (It’s Worse Than That)” for Lifehacker:Your conversations are not routinely transmitted to distant advertising companies so they can pick up random words and serve you commercials. This would take a lot of resources, and probably violate wiretapping and other privacy laws. … A few basic data points would be all anyone would need to get a rough idea of how to advertise to you. If your location is ‘Beverly Hills’ and you recently spent an hour looking at the Lexus website, you’re probably a rich guy in the market for a new car. In olden times, that’s all they’d need to target you, maybe with a billboard in your neighborhood or something. But online behavioral advertising collects so much other information—you bought a tent last month, you watched Star Trek on Sunday night—that targeting becomes scarily precise, to the point that it can feel supernatural. … [Computers] dispassionately compare mind-bogglingly huge datasets, and I assume they are making connections that are not apparent and can’t be readily explained. Maybe people just like you tend to be interested in learning to play the banjo when they turn 35, and that’s why that ad popped up on your birthday. For more information, read the article (and make sure you read the comments).
The Fully OA Group Responds to Congressional Bill That Limits Access to Federally Funded Research
The Fully OA Group, which “meets monthly to provide a platform for exchange and collaboration among ‘fully OA’ organizations,” issued a response to the House Appropriations Committee’s FY2024 bill for the Commerce, Justice, Science, and Related Agencies Subcommittee. It states, in part:In our capacity as representatives of leading fully Open Access research publishers and Open Science platforms, we submit our objection to the draft language in the Subcommittee’s FY24 spending bill that blocks implementation of the Office of Science and Technology Policy’s (OSTP) August 2022 guidance to make federally funded research freely available without delay. As a group of global publishers, we share a single aim—the transition to fully open scientific communication for the benefit of all parts of society. We believe the restriction of funds as outlined in Sec 552 of the bill is detrimental to this goal. We strongly support the OSTP guidelines which we believe represent a significant policy advancement for global scientific and academic research. For more information, read the response.
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Brandi Scardilli
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