May 24- May 31, 2007 Edition

Bertelsmann Strips

Down Bookspan

Clubs, Cuts Jobs

5/23/07–Bertelsmann AG, the Germany-based worldwide media conglomerate, is initiating a major restructuring of its book clubs after its recent purchase of Bookspan. The company will cut about 280 jobs from a total workforce of 1900 and will close a number of smaller clubs as it merges Bookspan and its Doubleday Entertainment into BMG Columbia House. In addition, Bertelsmann will shut down Madison Park Press which is less than two years old. Bertelsmann bought Bookspan in mid April, thus positioning itself as the only major club operation for books, music and DVDs in America.

Bertelsmann’s core book club brands, including Book-of-the-Month, Doubleday, Black Expressions, The Literary Guild, Crossings are apparently unaffected by the move. Among clubs to be shut down in coming months are American Compass, a conservative club; Early Childhood Teacher’s Club, Nurse’s Boo Society, Equestrian’s Edge, Behavioral Science Book Service, and the gay club, InsightOut. Members will be offered a membership transfer to other clubs. Decisions to close the smaller clubs and to shut down Madison Park will allow the company to concentrate on its core businesses, a spokesperson said.

Madison Park publisher Carol Baron will apparently continue her relationship with the company but exactly what her job will be was not yet announced. The company did say that it would honor its publishing commitments to its authors.

Until Bertelsmann’s acquisition, Bookspan was the leading marketer of book clubs and merchandise via direct mail and e-commerce in the U.S., with sales of about $700 million last year. The company is being merged into Bertelsmann’s BMG Columbia House operation, as part of its DirectGroup.

About 20 million Americans, mostly females in their 40s, continue to belong to book and music clubs.