Book Club Monopoly?
Bertelsmann AG of Germany has agreed to buy out Time Inc.’s interest in Bookspan, their book-club joint venture that includes Book-of-the-Month Club, American Compass, and other clubs. The Wall Street Journal reports that
The deal, announced today, would leave Bertelsmann as the only major operator of book, music and DVD clubs in the U.S.
Uh-oh! Sounds like a monopoly. Should we call the FTC Launch a congressional hearing No–first because nothing has actually changed; the joint venture was apparently already the only operator of such clubs. The only difference is that Bookspan is now solely owned by Bertelsmann.
But if two sets of book clubs had merged, then we might be hearing the same sorts of calls for antitrust investigation that we heard in regard to the proposed merger of the XM and Sirius satellite radio networks. And the argument would be just as ridiculous. A monopoly book club would not control book consumers; it would still compete with Amazon and Laissez Faire Books and other services for mail-order book consumers; and also with actual bookstores for book consumers generally; and with magazines and newspapers for readers; and with movies, television, radio, and iPods for the time and attention of consumers. Just like–as the Journal said a week or so ago–”a combined Sirius-XM would have to compete not only with free broadcast radio but also with MP3 players, online radio and even music channels offered by cable providers.”
Posted on April 11, 2007 Posted to Cato@Liberty,Regulatory Studies