Originally Posted by waldobushman
"Me too" clauses are common and certainly not anti-competitive. And, your characterization that the "me too" clause controlling what other retailers were charged is not accurate. Publishers could charge other retailers whatever they wanted, but they had to give Apple the same deal.
As for pricing that book purchasers pay, nothing is fixed here either. The publisher says that they need, say $12 for a title. That is what the publisher gets from the retailer. The retailer is free to charge whatever they want, probably including taking a loss on the deal, like Amazon was doing before Apple.
As I understood it, the original agreement Apple had with the publishes wasn't with regard to the price the publisher charged the retailer. It was about the prices the other retailers were allowed to sell to consumers. Sure, Apple can say they want the publishers to sell to Apple for a price at or lower than what they charge Amazon. No problems there. But what Apple was doing (as I understood when this issue first came about) was indirectly dictating the prices that Amazon could sell to it's customers
, the retail price. It would actually result in Amazon making MORE money from the higher prices, so why would Amazon complain? Because it fixed the prices (ie, price fixing) that they were allowed to set. They weren't allowed to sell to consumers for less than Apple (ie, anti-competitive).
Now, I hadn't looked this issue since it first came up, so perhaps it was clarified as something different, but that's what it was at the time.
Originally Posted by Maestro64
A few people already made similar comments, IF the DoJ is going after Apple and the publisher for this then should going at a lot of other industries for similar practices. Hell they should have gone after Apple a long time ago, We all know that you can not buy a new apple product which they are current marketing for a lower cost anyway. All retail outlets who sell Apple products are require to sell at the price that Apple tells them they must sell at.
But that is an agreement between Apple and their authorized reseller and has no bearing on the agreement Apple may have with another retailer. Also, you are talking about a single vendor (Apple), whereas Apple is viewed to have "coordinated" (ie, collusion) all (5 of 6) of the major publishers.
Imagine if Best Buy were to go to all of the PC vendors (Apple, HP, etc) and orchestrate a deal which would effectively bar a Best Buy competitor, such as Micro Center, from selling any PC for less than Best Buys sells it. Best Buy saying they want at least as good of a whoelsale price as Micro Center is one thing. But getting the PC vendors to tell Micro Center they can't set a retail price lower than Best Buys is another matter.
Originally Posted by jragosta
Whether the price is higher than the consumers want is totally irrelevant. Consumers don't get to set prices. The consumer's choice is only whether to buy at a given price or not.
I would love to see someone explain exactly which law Apple is alleged to have broken. If you look at it, it is clear that Amazon broke the law (by fixing prices) while Apple offered an alternative that did away with price fixing by letting the publishers set their own prices.
Consumer's don't get to set prices. Correct. But Apple should only be able to set prices for sales by Apple. Apple's agreement with the publishers also set prices that Amazon was able to sell at. Effectivley forbidding Amazon from competing with Apple on price. That is the very definition of anti-competitve.
You keep asking for someone to explain how Apple might
have broken the law (it's still just an investigation). But then you claim Amazon broke the law by "price fixing". So your turn to explain...what law do you think Amazon broke? They set prices and had agreements with each publisher. But where is the industry-wide collusion? How was Amazon saying how much Barnes & Noble could sell an ebook for?
This may all turn into nothing, and most likely will. But there does seem to be at least enough to warrant an investigation.