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Pearson buys Author Solutions, will integrate with Penguin

Pearson has acquired self-publishing company Author Solutions Inc for $116m (£74m) in cash, with Penguin c.e.o. John Makinson saying "self-publishing has moved into the mainstream of our industry".

Formed in 2007, ASI generated approximately $100m of revenues in 2011, according to a Pearson statement, growing at an average annual rate of 12% over the past three years, with its revenues stemming primarily from services to authors. The company has worked with 150,000 authors to publish, market and distribute 190,000 books, with approximately 1,600 staff located mainly in Bloomington, Indiana and Cebu City, the Philippines.

In a statement, Penguin said the acquisition gives it "a leading position in this fast-growing segment of the publishing industry and brings significant opportunity for the two companies to collaborate".

The statement said ASI's strengths lie in "online marketing, consumer analytics, professional services and user-generated content", with Penguin contributing "design, editorial and sales skills, and its strong international presence", as ASI looks to expand outside the US.

Makinson said: "This acquisition will allow Penguin to participate fully in perhaps the fastest-growing area of the publishing economy and gain skills in customer acquisition and data analytics that will be vital to our future.”

He also said: "Self-publishing has moved into the mainstream of our industry over the past three years. It has provided new outlets for professional writers, a huge increase in the range of books available to readers and an exciting source of content for publishers such as Penguin. No-one has captured this opportunity as successfully as Author Solutions, which has rapidly built a position of world leadership on a platform of outstanding customer support and tailor-made publishing services."

ASI chief executive Kevin Weiss said the company was looking forward to being part of Penguin's "vibrant culture" and said the company "look[s] forward to accelerating the pace of change the industry is experiencing. As part of Penguin, we will be on the front-end of that change and have the broadest set of offerings of any publisher today. That means more opportunity for authors and more choice for readers."

Author Solutions will be integrated into Penguin's infrastructure, but will continue to be run as a separate business. Pearson will be expensing integration costs in 2012, and expects the acquisition to boost adjusted earnings per share and to generate a return on invested capital above Pearson's weighted average cost of capital from 2013.

Editor's blog: The Day Self-Publishing Came of Age

FutureBook blog: Penguin Changes the Conversation

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This the first time I've posted on this site but I felt I needed to after checking out some of the prices on the Author House website.

I managed to get my self published novel 'Fallen Heroes' onto the shelves of several branches of Waterstones (not just on their website). This included their flagship branch in Piccadilly I've also been invited to do book signings at several of their stores. The e-book version also reached the number 1 spot on the Kindle Action Adventure chart.

This was done through a lot of hard work, research and as always a little luck. Yes I did pay to have my book professionally edited and a book cover created as I wanted Fallen Heroes to look as professional as possible. To achieve this cost me nothing like the minimum fee of £1,499 Author House are asking for. I worry that a lot of indie writers could get caught out by this now Penguin have attached their name to it.

This the first time I've posted on this site but I felt I needed to after checking out some of the prices on the Author House website.

I managed to get my self published novel 'Fallen Heroes' onto the shelves of several branches of Waterstones (not just on their website). This included their flagship branch in Piccadilly I've also been invited to do book signings at several of their stores. The e-book version also reached the number 1 spot on the Kindle Action Adventure chart.

This was done through a lot of hard work, research and as always a little luck. Yes I did pay to have my book professionally edited and a book cover created as I wanted Fallen Heroes to look as professional as possible. To achieve this cost me nothing like the minimum fee of £1,499 Author House are asking for. I worry that a lot of indie writers could get caught out by this now Penguin have attached their name to it.