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Insider's history of a publishing trend-setter, Simon & Schuster; Turning the Pages: An Insider's Story of Simon & Schuster 1924-1984, by Peter Schwed. New York: Macmillan. 320 pp. Illustrated, $19.95.

In 1924, two young men who had saved up $3,000 apiece started the publishing company of Simon & Schuster. Richard Simon, the more outgoing of the two, fostered the firm's dynamic approach to business, while Max Schuster cultivated its more purely literary projects.

In the years that followed, Simon & Schuster became known as one of the most innovative, trend-setting companies in the book trade, breaking new ground in such areas as pricing, advertising, marketing, and publicity. Some years after Simon's death and Schuster's retirement, the firm was sold in 1975 to the Gulf & Western conglomerate, a change that more or less coincided with its takeover by its current head, Richard Snyder.

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Peter Schwed, retired chairman of Simon & Schuster's editorial board, promises ''an insider's story.'' But this is no startling expose in the tradition of Deep Throat (who figured so prominently in ''All the President's Men,'' a typical S&S book of the past decade). This ''insider's story'' reflects a company man's view of his own company. Despite its title and some amusing anecdotes, Schwed's rather partial (in both senses) history is not exactly page-turning, nor is it likely to capture the interest of those who are not already interested in the subject.

Still, it is a revealing book, often unintentionally. Schwed's efforts to defend S&S's recent tendency to neglect high quality fiction in favor of hot best sellers are as embarrassing as the sharpest ripostes of the firm's many critics. His prose betrays more excitement in describing S&S's dealings with Jacqueline Susann than in mentioning its dealings with Einstein.

Schwed also tries to justify current S&S practices by drawing parallels between the powerhouse tactics of Snyder, et al., and the dynamism of the firm's earlier days, which also shocked its more ''gentlemanly,'' ''old-fashioned'' competitors. But it's a far cry from Max Schuster's and Dick Simon's ingenious packaging of ''War and Peace'' (a 12-page Reader's Guide and Bookmark was included to help readers find their way through all those pages and characters) to S&S's current obsession with packaging the ''stars'' of television and politics. The parallel that emerges from reading about the early days of S&S is not with today's company but with the early days of Hollywood. Like Samuel Goldwyn and Louis B. Mayer, Simon and Schuster were brilliant popularizers, whose shrewd instinct for salesmanship was mingled with a genuine concern for the quality of the product they were selling. It's hard to imagine an invitation from one of today's corporate types to ''sit under a palm tree with John Keats in the English countryside,'' as Schuster's geographically confused yet rather endearing ads urged readers to do.

Any mention of Simon & Schuster, Richard Snyder, and/or the general rise in conglomerate ownership of publishing houses is usually accompanied by the critical reactions of publishers worried about the effects of unbridled commercialism on the future of literature. Apologists like Schwed generally counter by arguing that without profits publishers wouldn't survive and that just because a book is a best seller doesn't mean it isn't a good book. Unfortunately, the view now prevalent at S&S seems to be that the very fact that a book is a best seller makes it a good book.

Yet the dichotomy between commercialism and literature can be misleading because it falsifies a complex situation. Although literature is surely threatened by the emergence of unblushing commercialism, it is also threatened, albeit more subtly, by self-anointed arbiters of literary taste who seem to think that they can spot ''real talent'' with the same unerring eye that commercially minded editors can spot the next instant trend or celebrity. Too much of what passes for ''quality'' literature bears the same relationship to the real thing as a plastic carnation to a rose. We might also wonder if the unabashed commercialism of one company is so very different from the ''closet'' commercialism of publishers more reluctant to admit to a concern for the ''bottom line.'' Listening to the arguments, it is sometimes as tiresome to hear one side boasting about its exquisite taste as it is to hear the other side bragging about its profit margins.

But a publishing house chiefly concerned with profitability does not even have the virtue of its own pretensions to live up to. In the case of a publishing house more interested in profits, success, and power than in books, the question remains: Power to accomplish what?

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