Apple is lone holdout in DOJ e-book pricing case after Macmillan settles - Page 2

So you seen for yourself that Amazon does not have a stranglehold on the ebook market like many here would like one to believe.

That's not how it should work. The government should not be able to get it's way by threatening you in to submission, they should have to objectively prove their case is an impartial court of law.

 

I wonder if Apple is powerful enough (in terms of legal expertise and money) to not be intimidated.

I agree. I'm actually quite surprised that some of these publishing houses didn't wield some political clout in this matter.

Perhaps they don't have a monopoly on losing money on selling ebooks.

Haha! Love it!

::facepalm::
You're clearly missing his point...

Apple allowed the publishers to set their prices.  The problem with Amazon is they held the Publishers hostage because of the volume of print books they sell.  This is the company the single handedly kill mom and pop book stores by undercutting them on price.  When ebooks came out they positioned themselves to corner the ebook market and made sure the competitors they had didn't stick around by pricing them out of the market.  The only real competitor who was left was Barnes and Noble.  They are by the way closing 30% of their stores this year.  If it wasn't for their college book stores they would be completely gone like the others killed by money loosing Amazon.  They are using the Walmart strategy,  undercut the market until there is no one left then charge whatever you want. If Apple gets out of the book business and Barnes and Noble go under, suddenly ebook suggested retail prices will be the standard at Amazon.  Apple's provides the service of hosting, payment processing, and advertising the store leaving at one count about 8-10 percent profit.  Keep in mind their purchases can be downloaded forever at no additional charge.  So one purchase is supported indefinitely by Apple.  They also handle support issue on top of this. I don't support Amazon because I don't believe in what they represent.  A company should not have free license to use smoke and mirrors to obtain funding to sustain themselves indefinitely while they continue to loose money and kill the markets of legitimate companies who deserve to survive.    

A razor thin margin is still a positive number though. Selling at a loss is not a razor thin margin.

Actually, the two are not necessarily different.

"Margin" most commonly refers to gross margin - the difference between the revenue you receive and the price you pay for an item.

"profit" is generally used to describe what's left from your gross margin after you pay all your overhead expenses (administrative costs, etc).

So it's not uncommon to have a razor thin margin (or even a moderate margin) and still sell at a loss.

Take the time to read the DOJ complaint and Apple's response. Clearly, Apple invented a novel way to fix prices. Instead of the publishers colluding with each other, they simply all colluded with Apple, individually. If A=B, and B=C, then A=C. Remember that one?

Nice try.

It is irrelevant whether Amazon can 'monopolize' the industry by selling product for low prices. Its up to the market to decide if that model will survive.

 

Yeah, that's what they always do with Google.

You seem to be making out like Apple was the bad one here. As you point out, the publishers were happy with this, there was no sense that Apple was forcing them to do anything.

http://www.justice.gov/opa/pr/2013/February/13-at-171.html

"According to the complaint, the five publishers and Apple were unhappy that competition among e-book sellers had reduced e-book prices and the retail profit margins of the book sellers to levels they thought were too low. To address these concerns, the department said the companies worked together to raise retail e-book prices and eliminate price competition, substantially increasing prices paid by consumers.

Before the companies began their conspiracy, retailers regularly sold e-book versions of new releases and bestsellers for, as described by one of the publisher’s CEO, the “wretched $9.99 price point.” As a result of the conspiracy, consumers were typically forced to pay $12.99, $14.99 or more for the most sought after e-books, the department said."

Apple is helping the suppliers maintain the value of their own products. Amazon forces them to go against their will:

http://www.forbes.com/sites/suwcharmananderson/2012/04/12/could-amazons-greed-be-its-undoing/

"“They decided they wanted me to change my terms,” said Mark Suchomel, president of the Chicago-based I.P.G. “It wasn’t reasonable. There’s only so far we can go.”

With each side unwilling to yield, Amazon pulled the plug, and all of I.P.G.’s books for Kindle disappeared. The physical books were not affected. A spokeswoman for Amazon declined to comment."

http://bits.blogs.nytimes.com/2012/02/22/amazon-pulls-thousands-of-e-books-in-dispute/?hpw

"Amazon.com removed more than 4,000 e-books from its site this week after it tried and failed to get them more cheaply, a muscle-flexing move that is likely to have significant repercussions for the digital book market.

Amazon’s decision to remove the digital titles was its most drastic such action since it briefly removed the physical books and the e-books published by Macmillan in a pricing dispute two years ago."

If they aren't allowed to set the prices of their own products at a level they are happy with, maybe they'll just decide to pull the plug on Amazon. They can sell direct on iOS and Android and Amazon gets nothing. Suppliers are eventually going to get fed up with retailers like Amazon dictating the value of their products.

Also people go on about Apple's 30%, authors/publishers only got 35% of their revenue before Amazon had any competition:

http://news.cnet.com/8301-17939_109-9820251-2.html

They changed it in 2010:

http://gizmodo.com/5452658/amazons-new-plan-for-ebooks-70-cut-for-publishers-10-max-price

 

You don't really get monopolistic behavior, huh.

I amended that for you a little.

I don't understand, but I admit I was not following the story.

If Apple allows any manufacturer to set their own price, what business is it of anyones? I know there must be more to it, but what of supply and demand? If they sell a mag for $50 but people are not willing to pay that and then they move it to $5 and people pay that, then the process is pure market.

Anyway...

Unfortunately this is something that Richard doesn't Getz. Lol sorry it was just too easy.

Your amendments resulted in something false and not analogous.
Apple sells lower fidelity versions without physical media of what mom and pop record stores sell. They should be expected to be cheaper.
The content of ebooks does not differ from the content of paper books to that extent.
Besides, it was the ability to buy only selected songs, as opposed to needing to buy the entire physical album, which was more responsible
for reduced sales for mom and pop, not so much the price.

The ability to buy selected songs always existed they were called singles, remember that? The even existed in CD form. Digital music was still the product, and Apple still did did not let the music industry set the price that they wanted, so why now all of a sudden are they being so gracious with the publishing industry?

 

That's a false corollary. 

 

At that time, iTunes and the record companies were competing against "free" (i.e. music file sharing sites like Napster).  99¢ per track and $9.99 per album were designed to be priced low enough that most people would opt to do the honest thing and pay for their music, even with label-mandated DRM.  And then they worked to get rid of the DRM.

 

wow, I never heard any Getz jokes before, how original ;)