In this article from the New York Times, Adam Davidson discusses the implications of the Random House and Penguin merger. He draws on the lessons drawn from a similar industry consolidation that occurred at the turn of the 20th century as outlined in the book “The Great Merger Movement in American Business 1895-1904,” by Yale economist and historian Naomi Lamoreaux.
Mr. Davidson argues that this tendency to merge could eventually result in an environment where there are “only one or two publishers and that they might be folded into some larger infotainment company like Time Warner Penguin or maybe Random Viacom. There would still be books — just not large book companies.
However this isn’t as big a threat as it might seem. Mr. Davidson notes that “it’s difficult to imagine how, in the digital world, publishers could ever monopolize the sale of written material. Even if there were only one house left, it would compete with every blogger and self-published e-book author. In short we could very well find ourselves in a world of “lots of small businesses and a few massive ones that handle big-ticket items.”
Davidson goes on to argue that the real concern is companies like Amazon amassing digital patents and using them to “sue upstarts out of existence.”