Apple Found Guilty of Conspiring to Raise eBook Prices…

Judge Denise Cote from the Southern District of New York has found Apple in violation of antitrust law in an attempt to raise the retail prices of e-books.

 

Accused of conspiring with five publishers to raise these prices since late 2009 (during impending launch of the iPad), Apple was guilty of “play[ing] a central role in facilitating and executing that conspiracy,” said Cote. The U.S. Department of Justice also said that Apple was basically attempting to weaken Amazon‘s dominance of the e-book market.

4 Responses

  1. _justen_
    _justen_

    The order, for those interested:

    http://www.justice.gov/atr/cases/f299200/299275.pdf

    Of note: The discussion of Steve Jobs’ statements regarding the degradation of the presumptive value of ebooks at a $9.99 price point set by Amazon (@149) and the subsequent discussion of Apple’s theory that an adverse antitrust ruling deters competition. As DMN has long followed the evolution of the iTMP price point of $.99 songs as a game-changer in the industry, this is an interesting development in Apple’s apparent loss-leader philosophy of “content” to push devices.

    Reply
  2. Farley
    Farley

    This is a great start to an interesting discussion: Is all media — music, ebooks, videos — the same in that providers will use it as a loss leader, so those who provide the content get squeezed? Are there ways out of this box for content creators of some or all media — even music? Does the way out require fixing of consumer prices?What is probably not an issue is whether Steve Jobs was willing to be inconsistent and use loss leader strategy for music, and then go for some other idea of pricing if needed to fight Amazon.

    Reply
  3. Visitor
    Visitor

    Publishers are going to learn the hard way that consumers don’t want to BUY their product, they want to rent it for a short period of time.

    It would make much more sense for a publisher to sell ACCESS to its material for a monthly charge that is less than buying copies you gfet to keep. The consumer don’t want to keep most of the stuff and they find little value in buying a novel they are going to read only once in their lives.

    The movie industry has made way more money with its rental model that is going on 30 years (the technologies have changed but model is roughly the same) at the same time the book and music publishers keep crying poor while actively trying NOT to give the customers what they want.

    Reply
    • Paul Resnikoff
      Paul Resnikoff

      Really interesting comment. Are you familiar with what O’Reilly has done? My CTO loves it: subscription for endless technical books (and I’m guessing a bunch of other genres beyond). Basically you don’t have to worry about shelving a resource you paid $180 for but needed for one month… etc.

      here’s some more (I really only know from casual conversation, not an expert on this…)

      Reply

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