Stephen King's 2022 merger testimony, revisited

The 2022 Penguin Random House case exposed concentrated profits, unearned advances and unequal marketing budgets. Four years later, the distinctions still matter for authors.

Stephen King testified against a merger involving his own publisher in August 2022. "I came because I think consolidation is bad for competition," he told the court, according to Publishers Weekly's account of his testimony. He was a Simon & Schuster author, published by Scribner, opposing Penguin Random House's proposed purchase of the company.

A recent Marley Jaxx YouTube Short revisits that testimony. The case deserves a flashback, particularly because the figures that emerged from it describe different things. A publisher losing money, an author failing to earn out an advance and a book selling few print copies are not interchangeable measures of failure.

King supplied the recognizable name. The executives, agents and economists supplied the evidence about how publishing pays. Four years later, that evidence remains useful to authors, provided nobody mistakes a 2022 trial statistic for a fresh survey of the business.

The case was about the buyers of manuscripts

Penguin Random House agreed in November 2020 to buy Simon & Schuster for $2.175 billion. The Justice Department sued in November 2021. The trial began on August 1, 2022, and ran for 12 trial days, with testimony from authors, agents and publishing executives, Judge Florence Y. Pan's opinion records.

The central question was competition to buy publishing rights, rather than competition to sell finished books to readers. The government focused on "anticipated top-selling books," using advances of at least $250,000 to identify that market for its analysis. Those acquisitions accounted for only 2 percent of books acquired but 70 percent of advance spending, Pan wrote.

In that market, the combined companies would have held about 49 percent. That was not a finding that they would sell half of all American books. Pan concluded that the acquisition was likely to substantially lessen competition for those publishing rights and blocked it. Her public opinion, filed November 7, 2022, explains the decision.

King put the concern more plainly. "I think it becomes tougher and tougher for writers to find enough money to live on," he testified, as Publishers Weekly reported.

The 35 books were real. So was the distinction about profit.

On page 5, Pan wrote that "only 35 out of 100 books turn a profit" and that "the top 4 percent of profitable titles generate 60 percent of profitability." She cited a presentation by PRH executives and testimony from then-CEO Markus Dohle and then-U.S. CEO Madeline McIntosh. These are figures in the court's account of the business, not numbers King produced on the stand.

The denominator matters. That second figure refers to a fraction of the profitable titles, not 4 percent of every book published. It describes profit, not units sold or revenue. Neither figure is a measured failure rate for a book submitted to a publisher in 2026.

Pan described a "portfolio business." Publishers acquire many books knowing that a substantial share will not be profitable. Breakout successes help finance the risk. The opinion also describes older books that keep selling, the backlist, as a source of stable revenue that allows publishers to take the long view. Both points appear on pages 5 and 6.

That supports a hit-driven business model. It does not establish a literal rule that one Harry Potter pays for 99 failures.

An unearned advance is not the publisher's loss statement

Another striking number concerned authors' contracts. Government economist Nicholas Hill testified that more than 85 percent of contracts for anticipated top-selling books never earned out their advances. Pan cited that testimony in a footnote on page 7.

This was the high-advance category used in the case. It was not a finding about every traditionally published author, nor about books receiving exactly $250,000.

An advance earns out when the author's accumulated royalties cover it. Until then, sales generate royalties credited against that advance rather than additional royalty payments. The author generally does not repay an unearned advance merely because sales disappoint, the opinion explains.

The publisher's calculation is different. Pan's page 16 footnote, citing Hill and McIntosh, says publishers begin to profit "at around 70 percent of earnout for most books." A book can therefore make money for its publisher without producing a royalty check beyond the author's advance.

That distinction changes the story. The 85 percent figure is evidence of how much compensation depends on the negotiated advance. It is not evidence that publishers lose money on 85 percent of those deals.

Marketing was unequal, not a universal allowance

The court record offers a more useful marketing comparison than a single average budget. Hill found that PRH and Simon & Schuster spent, on average, under $10,000 marketing books with advances below $250,000, compared with between $40,000 and $90,000 for books above that threshold, Pan wrote on page 35 (HTML text).

Those historical averages do not promise any author a particular campaign. They do show why an advance mattered beyond the amount of the check. Pan found that anticipated top-selling books received more attention from marketing and sales teams.

The opinion did not treat publishers' support as worthless. It describes the relationships their sales, marketing and publicity staff had built with booksellers and media. An account of the trial that counts only advertising dollars misses part of what authors were competing to obtain.

Why it still resonates in 2026

Consolidation did not end with that blocked acquisition. Publishing Perspectives reported in February 2026 that Hachette had become the third-largest U.S. publisher by Circana BookScan figures, with its 2025 growth helped by the acquisition of Union Square & Co. at the end of 2024. Those retail-sales rankings are not the manuscript-acquisition market shares used at trial. They do show that ownership and scale remain current trade news.

For authors, the practical question is still how the contract becomes income. In September 2026 guidance for the Authors Guild, Erin Lowry wrote that advances typically arrive in two to six installments, most commonly three or four. A four-payment deal may leave the last installment until a year after publication. The headline amount and the money available while an author writes are different figures.

Lowry also advised authors to discuss their publisher's marketing and publicity plans before deciding what they might need to fund themselves. That is a current, specific concern. It does not require pretending that every publisher stops promoting every book after three months.

There is another reason to revisit the record now. In April 2026, publishing analyst Jane Friedman returned to the trial's viral sales statistics to correct the impression that half of all books sell fewer than a dozen copies. She reproduced BookScan analyst Kristen McLean's separate 2022 breakdown, in which roughly 66 percent of frontlist ISBNs from ten major publishers sold fewer than 1,000 print copies over 52 weeks. Friedman stressed that BookScan's U.S. print retail figures omit ebooks, audio, direct sales and other channels. That snapshot is neither a lifetime sales total nor a court finding about all books.

King's concern was whether writers would have enough competing buyers to earn a living. The case put evidence behind that concern, while exposing how easily a number can lose its meaning when its category disappears.

Your next step, if you are weighing a publishing offer, is to ask when the money arrives and what support the publisher is actually committing to provide. The trial explains why those answers matter. It cannot supply them for your contract.

Sources

Flashback prompt: Marley Jaxx's YouTube Short. The reporting above draws on the court opinion and the separately identified sources, not the video's sales claims.