A Bookmaker’s Tale

A Bookmaker’s Tale

“The real money in books was going to be made not by writing or publishing but by buying and selling the publishing companies themselves.” Thus Michael Korda writes in his new memoir, Another


“The real money in books was going to be made not by writing or publishing but by buying and selling the publishing companies themselves.” Thus Michael Korda writes in his new memoir, Another Life, about a deal that to him signaled a major turning point in the history of the American book business. It happened almost forty years ago, in 1960, when Alfred A. Knopf decided to sell his company to Random House. But the scale of that transaction is tiny compared with today’s deals, in both publishing and bookselling. The headlines of the past few weeks about the aborted attempt by Barnes & Noble (the nation’s largest book retailer) to purchase the Ingram Book Group (the nation’s largest book distributor) in a $600 million offering, and the German firm Bertelsmann’s announcement of reorganization as it begins to merge Bantam Doubleday Dell and Random House (it acquired the latter last year), have made this very clear. Such is the world of modern publishing, and such is the backdrop against which to read Korda’s book.

Korda, Simon & Schuster’s editor in chief for an astonishingly long-lived thirty years, would tell you that to understand the evolution of book publishing in this century, it doesn’t hurt to have read The Great Gatsby. Not because of the novel’s intrinsic quality, staying power or backlist profitability; not because it featured in the marketing hype for the Modern Library’s “100 best novels” of the century list; not even because the trajectory of the novel’s publisher, Scribner–from family ownership to merger with Atheneum to purchase by Macmillan to present incarnation as Simon & Schuster literary boutique–follows a typical pattern.

No, a perusal of Another Life, which is a gossipy, knowing and highly entertaining account of Korda’s decades in publishing, sends you back to Fitzgerald because he reminds you that so many who have shaped the industry were in essence Gatsby-like: larger than life, with big ambition and bigger dreams, whose primary means of attaining them was to reinvent themselves and reinvent the business along the way. In the early years of this century, these were largely young, well-educated sons of self-made men, Jews who could not break into the WASP gentlemen’s club that was book publishing then. Instead, they turned their backs on the establishment and founded their own.

Think Alfred Knopf and his indefatigable partner-wife Blanche; Bennett Cerf and Donald Klopfer (Random House); Harold Guinzburg (Viking); Horace Liveright (his eponymous firm, long defunct, originated the Modern Library, among many other innovations); Dick Simon and Max Schuster.

Although it may seem hard to believe now, what was truly revolutionary was, first, that these publishers didn’t wait around for books to come to them but actively ventured into the world to seek them out; and second, having bought a book, they then devoted a great deal of energy to figuring out how to sell it and make it “news.” By extension, they marketed their companies and themselves and often achieved a kind of celebrity in the process, which became increasingly useful in selling their books.

To those ends, Knopf’s father, an advertising man who was the first person to import a Rolls-Royce into America after World War I, schooled his son in creating an extraordinary public persona. Liveright spent lavishly on advertising and cultivated Broadway and Hollywood connections. Cerf became a television personality in the medium’s early days.

And Simon & Schuster, who obviously figure larger in this account than any of the other modern progenitors, understood that a book didn’t have to be a novel or a biography or a mystery or anything traditional at all. Instead, it could teach you to play bridge or how to do your taxes or–as was their very first publication–be a compilation of crossword puzzles with a pencil attached, and sell in huge numbers. Of Max Schuster, Korda writes: “Max understood, as very few people in publishing have, the power of simple ideas. Nobody was ever better at inventing books that filled a need…[books] born from Max’s passionate belief that you could learn anything, change anything, help yourself ahead in any way merely by reading the right book.”

Their inheritors a generation later were people like S&S’s Dick Snyder (Korda’s onetime boss) and former Penguin CEO Peter Mayer, who molded existing companies to their own images and invented new rules. (Of his contemporary and friend Snyder, Korda writes that his “nice guys finish last” philosophy insured that S&S was not high “on the list of places that were fun to work at” but goes to great pains to show how Snyder left his mark on the business itself from the sixties on.) Later still, one only has to enlarge the circle, and Barnes & Noble chief executive Leonard Riggio comes to mind.

Nowhere is it written that book publishing is a democracy. Strong, imperious personalities have ruled much of it from the beginning and continue to do so, whether by charm or intimidation or both. Look at the house that Alfred built. Judith Jones, a distinguished editor who has worked at Knopf since 1957, once recalled in the trade magazine Publishers Weekly that under Alfred and Blanche, “the staff were like footballs that were tossed back and forth between them.” The style of Bob Gottlieb, their successor, as Korda recalls from his own early days working under this Wunderkind when Gottlieb was editor in chief at S&S, was to choose his “loved ones” and be “a benevolent autocrat.” Gottlieb himself told PW that he proposed Sonny Mehta as his successor at Knopf in part because of Mehta’s “very strong individual temperament and personal distinction.”

Of course, as they say, it all starts with the book. But what the Cerfs and Schusters of this world perhaps unknowingly set in motion–and what later generations, with a far more single-minded self-awareness, would complete–was a sea change that turned the central focus and power base within book publishing from the editorial to the marketing sphere. The unapologetic, coolheaded cynicism that pokes its head through Korda’s bubbly stories and that no doubt goes some way toward explaining how he’s managed to survive for so long at the top makes this abundantly clear. “Many of the most successful people in book publishing hardly like books at all and very seldom read one,” he tells us, while assuring us he is not among them.

In this rather novelistic memoir, Korda is eager to have his reader know that although he joined their ranks, he also stands apart from Snyder and the rest: Born to an English mother and a Hungarian Jewish father who was one of the famous Korda brothers dominating the British film business in the years before and after the Second World War, young Michael grew up knowing movie stars and money (without, he says, knowing that he was half Jewish), and he absorbed by osmosis the “class” of his Swiss boarding school and Oxford education.

In much of the book, Korda fluidly lets himself play Nick Carraway to Snyder’s Gatsby–or to other versions, like that of superagent Irving “Swifty” Lazar or novelist Jacqueline Susann. But Korda absorbed too much of the movie business at a very early age not to want to play the star in his own right. And so he also tells us about his other career–spawning bestselling commercial novels like Queenie (a fictionalized portrait of his aunt Merle Oberon) and self-help juggernauts like Power! What comes across most powerfully–to echo the title of an earlier memoir, which he devoted to his family–is that Michael Korda has led a charmed life in American book publishing. Unfortunately, not everybody who’s been in the business during those same decades has been so lucky.

A couple of times Korda pushes his charm and his luck a little too far–for this reader, anyway. A kind of disingenuousness intrudes into some stories, and what is supposed to be funny becomes rather cruel. For example, having already told us of the peculiar eccentricities of Irving Lazar, the Lysol-laced denouement to a story about Jesse Jackson’s visit to the agent is gratuitous and in bad taste. And, knowing of Ronald Reagan’s decline due to Alzheimer’s disease, it would have been kinder if Korda had left out his anecdote involving the former President’s hankering after a chocolate-chip cookie. In a book that is generally more elegant, such things are cheap shots.

Korda’s forty years in publishing have witnessed tectonic shifts in the industry, some of which have pushed prominent editors to the wayside and caused others to quit. Even an editor as powerful and highly regarded as Bob Gottlieb was not immune. Gottlieb was quoted in PW as saying about his 1986 departure from Knopf, “I saw it change from a publishing business to a marketing business, and I didn’t like it for me.”

The Gottlieb days at S&S, Korda says, taught him that enthusiasm and energy were the currency of book publishing. They still are, only, with the proliferation of more and more layers of buzz and hype, it has gotten somewhat harder to distinguish the fake from the real, even for those purveying the coinage.

Much of that buzz and hype is filtered through or amplified by television. Hand in hand with the shift in the balance of publishing power has been the tremendous growth in the electronic medium’s influence on the whole process. Korda, himself no stranger to the magazine and talk shows, goes so far as to assert that “the biggest revolution in the book business has been brought about by the curious symbiosis that established itself between television’s need for free talent and the need of book publishers to reach the public.” And again, “television, which everybody had expected would destroy book publishing, in fact saved and reinvented it.”

Not everyone involved with books shares Korda’s enthusiasm, of course. The power that TV wields–an endorsement by Oprah Winfrey is probably the industry’s most sought-after prize today–means that a potential author’s telegenicity is factored into how much a publisher is willing to pay for a book, or whether a house is willing to gamble on it at all.

It isn’t television, however, but the shift in ownership structure that has brought about the most profound change. The sixties was a time for revolution in many things, and book publishing was not exempt. When longstanding differences among Alfred and Blanche Knopf and the heir apparent, their son Pat, boiled over and caused the latter to leave the family firm and start Atheneum, the Knopfs stunned the publishing world by selling their jewel to Cerf and Klopfer’s Random House in 1960 (just as, some three decades later, the simmering disagreement between Roger Straus père et fils produced a similar result, sending Farrar, Straus & Giroux into the German von Holtzbrinck family’s hands). Most recently, it was the desire of Ingram family members to sell the family firm to Barnes & Noble that generated headlines, a deal that was scotched after reports leaked out that staff at the Federal Trade Commission saw potential antitrust violations in the concentration of so much bookselling power in one vertically integrated place.

Back in the sixties, publisher-owners like Cerf and Klopfer began to worry about the tax implications for their families if they should die, and they also recognized the need for greater capitalization. At the same time, Wall Street discovered book publishing, just as large media corporations like RCA, CBS and MCA discovered the word “synergy.” They were followed by the conglomerates, wanting not synergy but “diversification.” Then, in the current era, the more focused “synergy” of mega-entertainment/infotainment business clusterings such as those under the Viacom or Time Warner or News Corporation or Disney umbrellas came into vogue.

Throughout the sixties and seventies, the marriages were arranged and consummated, the money was made and the inevitability of the future divorces was the writing on the wall. In the eighties, a whole new series of mergers and acquisitions were brokered, some involving fallout from the previous ill-considered couplings; the nineties have only brought more.

Somewhere along the way, foreign buyers got in on the act–Robert Maxwell bought Scribner, Atheneum, the Free Press and Macmillan (until his going down in flames sent them into the S&S orbit); Rupert Murdoch (now an American citizen, lest we forget!) bought Harper & Row; Viking and later Putnam came into the fold of the British company Pearson; the von Holtzbrincks bought Holt, St. Martin’s (previously owned by the Brits anyway) and FSG; and Bertelsmann bought Bantam, then Doubleday and Dell, then finally Random House. The last, of course, had been taken public by Cerf and Klopfer and then sold to RCA, which in turn sold it to Condé Nast magnate S.I. Newhouse and his family, thence to Bertelsmann. Ironically, under both Newhouse and Bertelsmann, the publishing houses can claim to be “family owned”–but the bureaucratic layers of a huge corporation have been interposed between book and owner.

Korda, at times hilariously, describes life under S&S’s first conglomerate owner, Gulf + Western, and its manic and autocratic CEO, Charles Bluhdorn. (Not surprisingly, though, he keeps mum about current owner Viacom.) The deal with Bluhdorn was orchestrated by Snyder to prevent S&S from going into other (for him less desirable) hands. Once within G + W, whose method, like so many others, was to grow by agglomerating more and more companies so quickly that the banks didn’t notice the whole scheme was being funded on debt, Snyder realized that in order to keep up with what was happening across town at archrival Random House, he needed to go on a buying spree himself.

At Random House, Pantheon, Knopf, Vintage and “Little Random” had been joined by Ballantine, Fawcett, Times Books, Villard, Crown, Clarkson Potter, Harmony and major British houses, all under the Newhouse family. S&S wanted to go one better. With the consent of Martin Davis, who succeeded Bluhdorn as Gulf + Western CEO (and changed the corporation’s name to Paramount, after the Hollywood studio it also owned), Snyder set about making S&S (unhappily for a time renamed Paramount Publishing) into a huge educational as well as trade book publisher. The die was cast when he spent $700 million to buy Prentice-Hall in 1987.

But when S&S passed into Viacom’s hands, the “synergy,” seemingly, no longer worked–if it ever had. Korda tells us that S&S had grown from an $11 million US company to a $5 billion global corporation under Snyder’s stewardship. But Viacom saw things differently: It sold off the educational units and unceremoniously ousted Snyder in the process.

Throughout the merger-and-acquisition part of his tale, Korda acts very much as apologist for Dick Snyder, whom he dubs, odd as it may seem to many publishing eyes, “the victim of success.” But the question begs to be asked, What has been gained and lost in all this “success”?

I remember writing about S&S’s purchase of Prentice-Hall for Publishers Weekly. Many longstanding PH employees–whom S&S valued and wanted to keep–were numbed by the change. Confusion reigned: Sometimes it was hard to find out where people were, and even the switchboard didn’t know for sure. The culture of the company had been shattered.

Of course, companies, in order to thrive, have to evolve. Even in large shake-ups, people eventually adjust and the pieces are put back together another way. But something is lost, something human and valuable, a cultural intangible involving creativity and trust and people’s sheer pleasure in the work they do–something that rarely, if ever, can be completely regained.

One sure sign of this has been a shift in loyalty on the part of many authors. In the beginning, they owed their loyalty to the publisher-owners like Knopf and Cerf and Schuster. Then, as the companies were sold to corporations, their loyalty was placed more and more with their editors. Now, with so many editors hopping houses or being forced to hop, it has been transferred to their agents. And the agents’ power has increased enormously, as deal brokers and as gatekeepers deciding whether a book has a chance at being published at all.

Another sign is the level of anxiety being felt in the industry. Korda tells us that “having fun has always been an integral part of the book-publishing business,” but the parties and lunches and gossip circuit are weighed down with a lot more heavy baggage these days. In the major houses, job security is a thing of the past. People have become almost inured to the sudden announcement that a well-known editor in chief or publisher “has left the company to pursue other interests” or that one imprint is being folded into another because of the requisite “economies of scale.” Nevertheless, the moves that Bertelsmann has just taken toward consolidation, what most anticipate is only the first round of restructuring, have sent shivers throughout the business. (The timing of the announcement, on the eve of the Memorial Day holiday, when fewer people would be around to hear the news, could hardly have been coincidental.)

It is not simply that “reorganizing” Random House by merging Dell into Bantam, Broadway Books into Doubleday and combining Anchor with Vintage goes against Bertelsmann’s earlier assurances. What was shocking was the price Bertelsmann was willing to pay for such consolidation, including the loss of Dell president Carole Baron and, shortly before the announcement, “by mutual agreement,” Broadway president William Shinker, the president and publisher of Broadway–plus the loyalty of some major authors.

After all, the most valuable properties any publishing company has are the creativity, savvy and relationships with authors and agents that have been forged by its top editors and publishers. Thomas Harris, the bestselling author of The Silence of the Lambs, who had moved to Dell to work with Baron on his newest book, Hannibal, made that clear in an unusually forthright public statement: “Relieving Carole Baron as president and publisher of Dell in order to follow some mechanical blueprint of corporate structure is a mindless waste of the company’s best resources.”

By its nature, publishing has traditionally craved–and succeeded by–emphasizing what is individual in scale, as Korda’s stories ultimately attest. Under truly massive consolidation, where will individuality and the history and knowledge that an individual brings to the business fit?

Meanwhile, take a walk down the corridors of what constituted the pre-Bertelsmann Random House, and the nervousness is palpable. People are waiting to see who will stay and who else will leave; what more will be “consolidated” and what will remain separate; where the budget money will be pulled from and where it will go. It would be simplistic to assert that Bertelsmann is some sort of evil empire gobbling up US publishing. Bertelsmann is far more serious about the enterprise than many other corporate owners have been–publishing, after all, is at its very core, unlike most of the other entertainment conglomerates. But is bigness always best for an enterprise as peculiarly individual as the writing and making and buying and selling of books?

Pursuing bigness, indeed, is the modus operandi on every front these days. There is the bigness of the handful of hugely consolidated houses that do most of the educational and trade publishing in this country and make publishing increasingly resemble the movie business; the bigness of the big-box stores and warehouse clubs that handle so many of the deeply discounted bestselling books, hardcovers that sell in previously undreamed-of mass quantities, so much so that the bottom has fallen out of the traditional mass-market paperback business; the bigness of the retail chains, B&N and Borders, with their brick-and-mortar establishments and Internet presence; and despite its “upstart” aura, the bigness of Amazon.com.

For most of this decade, there was the enormity, too, of the mountains of unsold books the retailers returned to the publishers. The practice of returns–initiated, Korda reminds us, by Simon & Schuster as a way to help struggling booksellers during the Depression–has gotten a little more under control of late, but it still remains an unresolved structural problem for the whole industry.

Then there is the bigness of the money that publishers put on the table as advances for sure-fire or even vaguely potential bestsellers. Korda shows how this came to be. First were the high-stakes paperback auctions, then the vertical, hardcover/paperback deals–the grandfather of them all being one that Leon Shimkin, Max Schuster’s partner after Dick Simon, organized for Harold Robbins’s The Carpetbaggers.

As editors and publishers became further removed from the owners of the companies, a realistic grasp on the money they were proposing to spend in the chase for the ultimate “hot” book became more elusive. Korda quotes one former executive, Ron Busch, who has since died, as saying that sometimes bidding on big books was “like playing Monopoly”–you could bid ridiculously high, because it wasn’t, after all, your cash.

The feeding chain, whereby a small press publishes a new writer and then, after the work attracts attention and respectable sales, loses the author to a large house for a lot more money, is a fact of life. Rarely does this pattern reverse direction, except for those “midlist” authors whose work the big houses decide is no longer economically viable to publish.

How the book business will further evolve within this framework–at a time when the market for trade books is stagnant rather than growing–remains to be seen. The debacle of the scuttled merger between Barnes & Noble and Ingram shows that in some quarters there is a recognition that massive scale is not always best and can exact too high a price. And if one looks carefully inside the large houses, it is evident that those able to marry the clout of their financial resources to an ethos that allows them to “think small” in certain ways are happiest for author and publisher alike. Another illustration is provided by Korda himself: In his final chapter, he lists five “extraordinary” recent titles–Longitude, The Perfect Storm, Angela’s Ashes, Into Thin Air and Cold Mountain–that prove “the public’s ability to discern a remarkable book despite all the attention directed toward bad or mediocre ones.” Is it any accident that three of them were published by smaller-scale, independent houses?

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