In July 2013, two of the world’s biggest publishing houses came together in a merger that created ripples all over the global publishing industry. The two companies, Penguin and Random House, joined to create a mega publisher called Penguin Random House. The new publishing giant controls one quarter of the world’s book publishing business. The new company is estimated to publish more than 5,000 new books every year.

The two companies that merged have rich histories with Random House’s history dating back to 1924 and Penguin’s back to 1935. The two companies have fought some of the biggest and bloodiest publishing battles with one of their biggest successes being victory against censorship. Random House battled in the courts to overturn charges of indecency against Ulysses, a novel by James Joyce. Penguin fought to defend Lady Chatterley's Lover, a novel by DH Lawrence.

The merger of these two companies created a publishing giant with sales exceeding 4 billion dollars per year. The merger is arguably the biggest event in the publishing industry since Jeff Bezos started selling books online in 1994. However, despite the stature of the new giant publishing firm, it is an online publisher that steals the show when it comes to books.

Amazon rakes in quarterly book, music, and DVD sales of 4.4 billion. Online publishers have formidable pricing power because they have much lower costs to deal with than traditional publishers. This latest move by the two publishing behemoths to merge might be seen as a sign that the industry is becoming too competitive for the companies to survive individually.

What does this merger mean for authors? The founder and MD of Profile Books, Andrew Franklin, says that it is bad news for authors. According to Franklin, it will become difficult for the publisher to publish thousands of new titles each year while making each book different from the others. It will also be more difficult for authors to feel that their books are being treated with the importance they deserve.

Another thing that will be to the disadvantage of authors, particularly non-fiction writers, is that the competition for books at auctions will reduce significantly. This is because the two companies used to fight tooth and nail for books but now that they are on the same side. Non-fiction writers felt that the two publishers were the only two serious bidders at auctions. It is difficult to predict how auctions will be after the merger.

Apart from the absence of competition at book auctions, there are concerns that talented top women publishers might leave the publishing house. Gail Rebuck, one of the most respected women publishers in the UK, is no longer in charge of the day-to-day operations of Random House and settled for a chairmanship position. Another unexpected departure of a respected woman publisher is that of Victoria Barnsley. For 13 years she served as the CEO of Harper Collins.

There is rising concern that Amazon’s position in the publishing industry has unsettled traditional publishers. Sometime back there were concerns that supermarkets would ‘steal’ the business of traditional publishers and that clearly didn’t happen. Some people consider Amazon as just the latest ‘bogeyman’ in the publishing industry and nothing more.