4th August 2022
Bite-sized business news from the UK and beyond
Good morning Yesterday American share trading platform Robinhood, infamous for the ‘meme stock’ frenzy of 2021, announced it would layoff 23% of its workforce with affected workers notified…via Slack.
The company grew rapidly during the pandemic as DIY investing flourished but that growth has lost steam. It went public in July 2021 at $38 per share, and its stock jumped as high as $85 in its first month of trading. However, the stock quickly declined. Shares of Robinhood are down 48% year to date at around $9.
- Just Eat takes $3bn hit on US business
- Stephen King testifies in publishing mega-merger trial
Just Eat takes $3bn hit on US business
Other stories to keep you in the loop
- OPEC agree miniscule increase in oil production after President Biden request
- UK Parliament closes down its TikTok account over firm's China links
- South East Water announces hosepipe ban for Kent and Sussex
- Shell to give staff 8% bonus following sky-high profits
- Bain consultancy banned from government work over 'misconduct'
- Nick Clegg returns to London with other Facebook owner executives
- Airbnb bookings hit record high as travel recovers
- Tinder chief executive leaves the dating app
- Housebuilder Taylor Wimpey gives employees £1,000 cost-of-living bonus
Stephen King testifies in publishing mega-merger trial
This week horror novel legend Stephen King testified against a $2.2bn merger of publishers Penguin Random House and Simon & Schuster saying it would harm competition.
How did we get here?
In the world of book publishing, a so-called ‘Big 5’ of publishers reign supreme: MacMillian, Harper Collins, Hachette Book Group, Simon & Schuster and Penguin Random House (itself the result of a 2013 merger that ended the era of a ‘Big 6’).
When Penguin Random House announced in 2020 that it had agreed to acquire Simon & Schuster, there was backlash from authors and industry leaders that in the new landscape the merged company would be too dominant – controlling around half the market - and stifle competition. As a result the US government is investigating the deal and began an antitrust trial on Monday.
Horror author Stephen King took the stand on Tuesday as a witness stating consolidation is bad for competition in the industry. The bestselling author, mainly published by Simon & Schuster, testified to his belief large publisher mergers lead to lower pay for authors.
The government argued the deal would negatively affect authors with fewer bidders for their work, resulting in lower author advances.
The Penguin Random House and Simon & Schuster argue it would allow both companies to pool their resources to make the industry more competitive, offering higher advances. The two publishers will still operate separately and can bid against each other for book deals.
Up next: the trial is expected to last up to three weeks and includes testimony from top book executives throughout the publishing world.
Stat of the day
Tiger Woods reportedly turned down over $700m to join the controversial Saudi Arabia backed LIV Golf Tour
Interesting links from around the web