or Connect
AppleInsider › Forums › General › General Discussion › Apple continues fight to have antitrust monitor reined in, judges appear skeptical
New Posts  All Forums:Forum Nav:

Apple continues fight to have antitrust monitor reined in, judges appear skeptical

post #1 of 89
Thread Starter 
A U.S. appeals court on Tuesday heard initial arguments from Apple regarding the stoppage of antitrust monitor Michael Bromwich's duties until while the court decides whether he should be removed altogether.

Bromwich
Michael Bromwich | Source: ZUMA Press via mnn.com


As part of its ongoing battle to have Bromwich removed, or at least restrained, from his monitorship, Apple stated its case to the U.S. Court of Appeals for the Second Circuit. Apple argues that the external compliance monitor's work should be halted until the court hands down a ruling on a requested removal, reports Reuters.

According to Apple, Bromwich is disrupting business operations and harming the company with his questionable monitoring methods. If the ECM were allowed to continue work, only to be removed when the court later finds his actions improper, Apple would have spent time and money it cannot get back.

"The court can't give us relief," said Apple counsel Theodore Boutrous, Jr. "We can't turn back the clock."

So far, however, the appellate court's three-judge panel seems unmoved by Apple advances.

"Maybe if they had spent some of their very valuable time keeping the company from violating antitrust laws, perhaps they wouldn't be in this position," Judge Gerard Lynch said.

The jurist suggested the court draw up an order specifying the limits of Bromwich's role, but Boutrous said Apple would still oppose such measures. Counsel noted that the Department of Justice is capable of monitoring Apple on its own without the aid of a private party with incentive to grow income based on the scope of his tenure, reports The Wall Street Journal.

"The government has other things to do," Judge Guido Calabresi said.

As for the DOJ, lawyer Finnuala K. Tessier argued Bromwich had to get back to work immediately to ensure Apple does not again engage in illicit activities.

"An ounce of prevention is worth a pound of cure," Tessier said.

Apple has complained accused the ECM of conducting a wide-roving and unconstitutional investigation of the company, making requests that go beyond the scope of his duties.

For example, Bromwich wanted to meet with Apple executives and board members like Jony Ive, many of whom do not have insight into the company's daily business operations. In addition, the ECM's pay structure of over $1,000 per hour was called excessive.

The debacle stems from the DOJ's successful e-books case against Apple. In September, Judge Denise Cote handed down an injunction against Apple after finding the tech giant guilty of colluding with book publishers to falsely inflate the price of e-books sold through the iBookstore.

While the appeals court debates the matter, Bromwich's work is being put on hold until a determination is made on Apple's request for an even longer suspension of duties.
post #2 of 89
Getting busted artificially manipulating market prices sucks. I'd say I hope Apple learned their lesson, but seeing how they seem more indignant about the public humiliation than embarrassed about cheating the consumer, I'm gonna guess they probably aren't.
post #3 of 89
Getting pretty tedious now.

censored

Reply

censored

Reply
post #4 of 89
Quote:
Originally Posted by Cash907 View Post

Getting busted artificially manipulating market prices sucks. I'd say I hope Apple learned their lesson, but seeing how they seem more indignant about the public humiliation than embarrassed about cheating the consumer, I'm gonna guess they probably aren't.

When did the market decide Amazon's 9.99 is the market price? Didn't Amazon manipulate that too?

I like this line: "The government has other things to do," Judge Guido Calabresi said.

--Like continue justifying Amazon's monopoly.
post #5 of 89
I still haven't seen a clear explanation of what it is that Apple did wrong with the e-book case. Apple did not have any monopoly power in their negotiations with the publishers nor was Apple proven to have facilitated negotiations between publishers. The opposite was quite clearly true; the publishers were colluding prior to Apple's involvement.

I also fail to understand why the DOJ wanted to pursue Apple in the first place. Raising consumer prices does not make a monopoly or antitrust case.

I do understand that Apple has smart lawyers, and structuring a deal so it has the plausible deniability built in seems believable. But ultimately the publishers (who do have a government-given monopoly) changed their licensing deals which forced the impact. Had they allowed Amazon to keep the wholesale model, Apple would have been happy to set their prices to match, and the publishers would just lose money selling to Apple. This might not have been a bad thing; Amazon loses on all the books they sell, and the publishers lose on the books they don't! It would have applied pressure to Amazon to change their ways, but without pushing their hand.

...but all this still comes down to publisher action and not Apple's.
post #6 of 89

Ive to Bromwich.."Mikey, come on up and let's have lunch on the roof... the view is great"

 

Ive to police.. "shit, he just slipped"

OMG here we go again...
Reply
OMG here we go again...
Reply
post #7 of 89
Quote:
Originally Posted by Cash907 View Post

Getting busted artificially manipulating market prices sucks. I'd say I hope Apple learned their lesson, but seeing how they seem more indignant about the public humiliation than embarrassed about cheating the consumer, I'm gonna guess they probably aren't.

These petty little comments are all you have left in life now, aren't they?

1wink.gif
post #8 of 89
Quote:
Originally Posted by Cash907 View Post

Getting busted artificially manipulating market prices sucks. I'd say I hope Apple learned their lesson, but seeing how they seem more indignant about the public humiliation than embarrassed about cheating the consumer, I'm gonna guess they probably aren't.


How did Apple manipulate market prices?  Apple simply let the publishers set the prices they like.  Apple did not do anything.  So not doing anything is manipulating prices?

post #9 of 89

The thing is that prices went down after the Apple agreement.  Apple broke the Amazon monopoly and provided real competition, that not only helped Apple, but also Barnes and Noble, etc.  Most notably it lowered prices for consumers till this day.  

post #10 of 89
Originally Posted by tzeshan View Post
How did Apple manipulate market prices?

 

That’s manipulating them. You see, when you have a monopoly, like Amazon, and set one price for everyone, there’s no manipulation because that’s the only price. But when anyone can set any price they want, they can manipulate those numbers all up and down. It’s chaos!

Originally posted by Marvin

Even if [the 5.5” iPhone exists], it doesn’t deserve to.
Reply

Originally posted by Marvin

Even if [the 5.5” iPhone exists], it doesn’t deserve to.
Reply
post #11 of 89

What harm does the monitor hurt Apple?  I think the simple answer is Apple management is invloved in a lot of trade secret works.  Allowing any outsider or even lower level employee to inquire the exectives of course will cause unforeseen harm. 

 

Could the Court protect Apple on trade secrets?  Of course not!  A case in pint is the release by Samsung counsel of Apple licensing agreement with Nokia.  Even after Apple filed complaint.  The Court choose not to publish Samsung.  The Court has failed once.  How could Apple trust the Court again?

post #12 of 89
PED's take on this somewhat different: he focuses on the fact that court is leaning in the direction of putting in constraints on Bromwich, and that the odds might be in Apple's favor. http://tech.fortune.cnn.com/2014/02/04/apple-cote-bromwich-appeal/

In any event, Apple would be better served by just jettisoning this trivial business. It is a complete distraction. After all, it contributes very little to the bottom line, takes too much of the top management's time, impacts Apple's reputation adversely, and apparently, the morons -- I mean, our rulers -- in DC are convinced that competition will be enhanced. Just make the link to the Amazon bookstore the main link to books via iOS, leave them to this low-margin business, and move along, Apple.
post #13 of 89
Quote:
Originally Posted by Tallest Skil View Post
 

 

That’s manipulating them. You see, when you have a monopoly, like Amazon, and set one price for everyone, there’s no manipulation because that’s the only price. But when anyone can set any price they want, they can manipulate those numbers all up and down. It’s chaos!

Since when? Amazon doesn't sell every e-book for the same price and neither does the iBookstore. Every book isn't worth the same price the same way every other item people buy isn't worth the same and doesn't sell for the same. A publisher and the books author have every right to set a price for their work. Amazon pays the publishers some amount but sells them for less, thereby forcing other vendors out of the market. Apple allowed publishers to set a price, like in any other business, and they took 30%. What's wrong with that. Gas prices aren't the same at every gas station and they go up and down for no apparent reason yet I'm not seeing the DOJ going after the oil companies for obvious price fixing. 

post #14 of 89
Quote:
Originally Posted by anantksundaram View Post

PED's take on this somewhat different: he focuses on the fact that court is leaning in the direction of putting in constraints on Bromwich, and that the odds might be in Apple's favor. http://tech.fortune.cnn.com/2014/02/04/apple-cote-bromwich-appeal/

In any event, Apple would be better served by just jettisoning this trivial business. It is a complete distraction. After all, it contributes very little to the bottom line, takes too much of the top management's time, impacts Apple's reputation adversely, and apparently, the morons -- I mean, our rulers -- in DC are convinced that competition will be enhanced. Just make the link to the Amazon bookstore the main link to books via iOS, leave them to this low-margin business, and move along, Apple.


I disagree.  Apple should make no compromise to truths and facts.  This is what separates Apple from its competitors.  If Apple gives up, it loses the trust of its customers. 

post #15 of 89

"Maybe if they had spent some of their very valuable time keeping the company from violating antitrust laws, perhaps they wouldn't be in this position," Judge Gerard Lynch said.

 

"The government has other things to do," Judge Guido Calabresi said.

 

These statements are definitely prejudicial. These judges have already sided with Judge Cote without even waiting for anything to be presented. The DOJ is upset because an American company is making money. Go figure. I guess court cases take too much time away from their golf games.

post #16 of 89

http://tidbits.com/article/13912

 

Quote:

Originally Posted by aaarrrgggh View Post

I still haven't seen a clear explanation of what it is that Apple did wrong with the e-book case. Apple did not have any monopoly power in their negotiations with the publishers nor was Apple proven to have facilitated negotiations between publishers. The opposite was quite clearly true; the publishers were colluding prior to Apple's involvement.

I also fail to understand why the DOJ wanted to pursue Apple in the first place. Raising consumer prices does not make a monopoly or antitrust case.

I do understand that Apple has smart lawyers, and structuring a deal so it has the plausible deniability built in seems believable. But ultimately the publishers (who do have a government-given monopoly) changed their licensing deals which forced the impact. Had they allowed Amazon to keep the wholesale model, Apple would have been happy to set their prices to match, and the publishers would just lose money selling to Apple. This might not have been a bad thing; Amazon loses on all the books they sell, and the publishers lose on the books they don't! It would have applied pressure to Amazon to change their ways, but without pushing their hand.

...but all this still comes down to publisher action and not Apple's.

 

 

Quote:
Originally Posted by tzeshan View Post
 


How did Apple manipulate market prices?  Apple simply let the publishers set the prices they like.  Apple did not do anything.  So not doing anything is manipulating prices?

 

 

Quote:
Originally Posted by Jack Zahran View Post
 

The thing is that prices went down after the Apple agreement.  Apple broke the Amazon monopoly and provided real competition, that not only helped Apple, but also Barnes and Noble, etc.  Most notably it lowered prices for consumers till this day.  

 

 

http://tidbits.com/article/13912

post #17 of 89
Quote:
Originally Posted by tzeshan View Post


I disagree.  Apple should make no compromise to truths and facts.  This is what separates Apple from its competitors.  If Apple gives up, it loses the trust of its customers. 

Were it so simple. At the end of the day, the only way to run a value-creating business is to do smart cost-benefit analysis. Anything else is irresponsible. It doesn't take long before a significant chunk of the same consumers to start viewing you as a crook. (Arguably, Microsoft suffered from some of that after their adverse antitrust ruling in the 1990s.)

Apple has no business in social activism.
post #18 of 89
Ho
Quote:
Originally Posted by Cash907 View Post

Getting busted artificially manipulating market prices sucks. I'd say I hope Apple learned their lesson, but seeing how they seem more indignant about the public humiliation than embarrassed about cheating the consumer, I'm gonna guess they probably aren't.
How did they cheat customers? The books were a certain price and the customer could decide if they wanted to pay the price or not. If you didn't like the price, buy elsewhere. All Apple had in their contract was a most favored nation clause which said if you sell your book to someone else for a lower cost, you need to sell to us at the lower cost and they would do that through an agency model instead of a wholesale model. Amazon got pissy because the publishers finally could stand up to Amazon and demand a retail price instead of Amazon's monopoly-building prices.

The government is interfering with normal market dynamics and I have yet to see how Apple did something wrong. If any one colluded with the publishers, it was Steve Jobs and well, this dude would need to cease living to have a chat with him.
post #19 of 89
Quote:
Originally Posted by Just_Me View Post

http://tidbits.com/article/13912
Quote:
Again, there is nothing inherently illegal with the agency model, price tiers, or an MFN clause. And there isn’t even anything wrong with combining them in negotiation with a single company. The problem comes when they’re combined in negotiation with six publishers that between them control nearly 50 percent of the book market, and over 90 percent of the New York Times bestsellers.

After five of the Big Six publishers signed Apple’s deal, they immediately went to Amazon to switch their wholesale pricing agreements to the agency model. Amazon was understandably upset about this, due to the loss of pricing control, but had no choice but to accept in the end. Subsequently, the publishers also negotiated an agency model with Google, which was similarly unhappy.
...
In Judge Cote’s opinion, the combination of Apple working with all the publishers simultaneously to fix ebook prices in such a way as to cause them to rise was where Apple violated the Sherman Antitrust Act.

...and I still don't understand how she loops Apple into "collusion" when it is quite clear that negotiations were separate. The publishers were aware of the negotiations among their peers, and Apple was not hiding the fact, although there is no proof that they disclosed the exact terms they were negotiating between the various players. The OPPOSITE was actually disclosed, that the publishers were talking among each other, which in my simple mind would seem to prove that Apple was not the "ring leader".
post #20 of 89
Quote:
Originally Posted by anantksundaram View Post


Were it so simple. At the end of the day, the only way to run a value-creating business is to do smart cost-benefit analysis. Anything else is irresponsible. It doesn't take long before a significant chunk of the same consumers to start viewing you as a crook. (Arguably, Microsoft suffered from some of that after their adverse antitrust ruling in the 1990s.)

Apple has no business in social activism.


This is not social activism.  This is whether Apple broke the law.  There is a lot of distrust of DOJ and DOJ appointed judge in this case.  Apple should fight all the way to the Supreme Court!  Do you know there is a reason for the existence of the Supreme Court?

 

If Apple don't fight for the rightness how could it fight for the patents?  For a true leader consistency is utterly important. 

post #21 of 89
Quote:
Originally Posted by Cash907 View Post

Getting busted artificially manipulating market prices sucks.

Sure it would.
But what does that have to do with Apple or this article?
post #22 of 89
Quote:
Originally Posted by tzeshan View Post

Do you know there is a reason for the existence of the Supreme Court?

Gee, thanks for enlightening me. 1rolleyes.gif
post #23 of 89

Perhaps they should decide Bromwich should go & look into Amazon's practice of killing off other competitors in the e-book & book market, on-line & high street, by overly aggressive pricing. When they've killed off most the competition, who's to say they won't be raising their prices to higher than the publishers recommended prices for a profit. It could be, 'You want or need a book, pay our price or go elsewhere. Oh you can't can you?'

 

The way I see it, Apple's planned iBook structure would only help rebalance the market. Hell, if it meant Amazon had to even sell books at the purchase prices, the recommended prices, or stop selling books directly, & leave it to others on their site to sell them, they could increase their profits, as they would not be taking a loss on each sale.

 

Competition & choice is good for the market, & the consumers. Monopolies, like Amazon is becoming, are not.

post #24 of 89
Quote:
Originally Posted by rob53 View Post
 

Gas prices aren't the same at every gas station and they go up and down for no apparent reason yet I'm not seeing the DOJ going after the oil companies for obvious price fixing. 

 

Well in Australia the oil companies got around this by arguing the price isn't changing, it remains level tied to the price of Singapore crude, discounts on the "price" is what causes daily fluctuations.

 

Offering to remove the discounts soon got the government off their backs.

 

Although it beats me (and a lot of Australians) why an increase in the cost of Singapore crude is reflected almost immediately at the pumps, yet a decrease takes days or weeks to flow through.

 

The $9.99 was a discounted price by Amazon and as such was not representative of the real value.

Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
Reply
Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
Reply
post #25 of 89
Quote:
Originally Posted by anantksundaram View Post

In any event, Apple would be better served by just jettisoning this trivial business.

 

Trivial?

 

States are after $840 million in triple damages over this.

 

Has Apple even sold $840 million worth of iBooks?

Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
Reply
Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
Reply
post #26 of 89
Quote:
Originally Posted by hill60 View Post

Trivial?

States are after $840 million in triple damages over this.

Has Apple even sold $840 million worth of iBooks?

His much does/did it generate as profits for Apple? I am guessing it's, indeed, trivial.

I thought the $840M number was triple damages?.
post #27 of 89
Quote:
Originally Posted by anantksundaram View Post

the morons -- I mean, our rulers -- in DC

"Morons"? Typically. "Rulers"? Well, what should be remembered is they are NOT rulers but rather SERVANTS of the people!
post #28 of 89
Quote:
Originally Posted by hill60 View Post

Well in Australia the oil companies got around this by arguing the price isn't changing, it remains level tied to the price of Singapore crude, discounts on the "price" is what causes daily fluctuations.

Offering to remove the discounts soon got the government off their backs.

Although it beats me (and a lot of Australians) why an increase in the cost of Singapore crude is reflected almost immediately at the pumps, yet a decrease takes days or weeks to flow through.

The $9.99 was a discounted price by Amazon and as such was not representative of the real value.

Gas stations sell current supply to pay for future supply. Meaning they take an educated guess on what the wholesale price would be when they next get supply and adjust retail price accordingly.
post #29 of 89
Quote:
Originally Posted by rob53 View Post

"Maybe if they had spent some of their very valuable time keeping the company from violating antitrust laws, perhaps they wouldn't be in this position," Judge Gerard Lynch said.

"The government has other things to do," Judge Guido Calabresi said.

These statements are definitely prejudicial. These judges have already sided with Judge Cote without even waiting for anything to be presented. The DOJ is upset because an American company is making money. Go figure. I guess court cases take too much time away from their golf games.

Appropriate since Cote did the same thing. And then cherry picked the evidence she heard to back up her decision.

This whole thing will likely have to go to the highest court before anything changes. And Apple will see it that far if needed. And hopefully along the way the full history f how Amazon behaved will come out etc.

The DOJ positioned this as protecting consumers as well as competition. And yes laws need to change but they need to cover all the players to ensure we can buy from where we want fairly. For all media. Whether we are talking from iTunes, Amazon or even paper/disk

A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

Reply

A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

Reply
post #30 of 89
Quote:
Originally Posted by charlituna View Post

Appropriate since Cote did the same thing. And then cherry picked the evidence she heard to back up her decision.

This whole thing will likely have to go to the highest court before anything changes. And Apple will see it that far if needed. And hopefully along the way the full history f how Amazon behaved will come out etc.

Whatever Amazon does or doesn't do has zero influence on this case and probably won't even be raised by Apple's attorneys. Why would it matter? Apple made their own choices, unless you want to believe that Amazon can play them like a puppet. I have a teenager who's tried that excuse.

The gist of the argument here for many seems to be Apple dun nuttin and even if they did it's 'cause Amazon made 'em do it. 1rolleyes.gif Anant has the right idea IMO. Keeping the story alive isn't doing Apple any good on the PR front. With so little to be made from e-Book sales in the first place just move on.
melior diabolus quem scies
Reply
melior diabolus quem scies
Reply
post #31 of 89
Quote:
Originally Posted by TogetherWeStand View Post
 

Perhaps they should decide Bromwich should go & look into Amazon's practice of killing off other competitors in the e-book & book market, on-line & high street, by overly aggressive pricing. When they've killed off most the competition, who's to say they won't be raising their prices to higher than the publishers recommended prices for a profit. It could be, 'You want or need a book, pay our price or go elsewhere. Oh you can't can you?'

That would also be illegal.

 

Quote:
The way I see it, Apple's planned iBook structure would only help rebalance the market. Hell, if it meant Amazon had to even sell books at the purchase prices, the recommended prices, or stop selling books directly, & leave it to others on their site to sell them, they could increase their profits, as they would not be taking a loss on each sale.
How is illegally forcing another company to raise their prices in any way a good thing? Amazon wants to take a loss on the bestsellers as it means people are more likely to purchase other books that are priced above the wholesale price.
 
Quote:
Competition & choice is good for the market, & the consumers. Monopolies, like Amazon is becoming, are not.

Right, and Apple collaborated with the largest publishers to completely eliminate price competition. Leaving them to use their market position to try and destroy Amazon with the iPad. How is a consumer being duped into paying higher prices so Apple can sell more iPads a good thing?

post #32 of 89
Quote:
Originally Posted by ItsTheInternet View Post

That would also be illegal.

How is illegally forcing another company to raise their prices in any way a good thing? Amazon wants to take a loss on the bestsellers as it means people are more likely to purchase other books that are priced above the wholesale price.

Predatory pricing is illegal. That is what Amazon is doing. It illegally created a barrier to entry. All Apple did was level the playing field. Notice after the agreements were made, more competition was formed.
post #33 of 89
Quote:
Originally Posted by jungmark View Post


Predatory pricing is illegal. That is what Amazon is doing. It illegally created a barrier to entry. All Apple did was level the playing field. Notice after the agreements were made, more competition was formed.


You've absolutely no evidence of Amazon predatory pricing. Indeed the DOJ indicates they have consistently made a profit. Provide proof or retract your claim.

 

How can Apple have created more competition by eliminating the ability to compete on price. What competition remains? iPad vs Kindle Fire? You think that's particularly reasonable competition?

post #34 of 89
Quote:
Originally Posted by ItsTheInternet View Post


You've absolutely no evidence of Amazon predatory pricing. Indeed the DOJ indicates they have consistently made a profit. Provide proof or retract your claim.

How can Apple have created more competition by eliminating the ability to compete on price. What competition remains? iPad vs Kindle Fire? You think that's particularly reasonable competition?

You just said Amazon is taking a loss on each best seller it sells. I don't know about you, but I would like to make money by selling ebooks. More companies would rather sell ebooks at the same price rather than lose money at lower prices. Hence more companies will get in the game.

I am also talking about ebook competition.
post #35 of 89
Quote:
Originally Posted by jungmark View Post


You just said Amazon is taking a loss on each best seller it sells. I don't know about you, but I would like to make money by selling ebooks. More companies would rather sell ebooks at the same price rather than lose money at lower prices. Hence more companies will get in the game.

I am also talking about ebook competition.

 

I'm sure the companies would love to sell ebooks at higher prices. That however is not competing. That is sharing a market by collaborating to ensure no consumer gets a better deal. You've basically typed out almost the definition (as I understand it) of an anti-competitive collusion and are arguing it is pro-competitive.

 

Competitive is not 'lots of companies'. It is lots of companies fighting for the market by reducing prices. Apple (and the publishers, they also deserve blame) eliminated this competition, leaving only external factors like iPads / Kindles to compete on. Apple can obviously win that competition without losing money.

post #36 of 89
Quote:
Originally Posted by ItsTheInternet View Post

I'm sure the companies would love to sell ebooks at higher prices. That however is not competing. That is sharing a market by collaborating to ensure no consumer gets a better deal. You've basically typed out almost the definition (as I understand it) of an anti-competitive collusion and are arguing it is pro-competitive.

Competitive is not 'lots of companies'. It is lots of companies fighting for the market by reducing prices. Apple (and the publishers, they also deserve blame) eliminated this competition, leaving only external factors like iPads / Kindles to compete on. Apple can obviously win that competition without losing money.

How is it competitive when one company can sell for a loss indefinitely? If other companies do this, they'd go out of business. Competition is more than just prices.
post #37 of 89
Quote:
Originally Posted by jungmark View Post


How is it competitive when one company can sell for a loss indefinitely? If other companies do this, they'd go out of business. Competition is more than just prices.

 

Amazon still makes a profit on their overall ebook department, so they can only use loss-leaders indefinitely. Apple could already compete on many factors such as having an amazingly best selling tablet. They knew (as shown in the emails) that they couldn't reasonably price things at the wholesale prices ($14.99 or so) if Amazon were willing to sell them for $9.99.

 

Thus Apple could have resigned themselves to selling fewer ebooks, they could have adopted a process of loss-leaders and reduced their income, they could have (and to some extent, did) pioneered new features that the competition didn't have.

 

In fact you can see evidence of this tactic all over the place, for example B&N put a bunch of effort into 'lending' services with the Nook, somewhere Amazon couldn't compete due to their lack of high street presence. This is the sort of competition that these laws enforce. If Amazon truly was predatory pricing then there would be a genuine issue, but as Cote mentioned, the correct procedure to go through is to file a complaint. It is not to orchestrate an illegal price fixing conspiracy that benefits Apple massively.

 

If Apple had just levelled the market without putting themselves at a huge advantage I might have some sympathy, but it's clear that the upper management knew what they were doing and why they were doing it. It certainly wasn't to provide the consumer with direct benefits.

post #38 of 89
Quote:
Originally Posted by jungmark View Post


Predatory pricing is illegal. 

 

Technically not true, though it can form part of an antitrust claim against monopolistic behaviour.

 

In any case, if Amazon were setting prices of bestsellers artificially low while other books made enough profit to carry the business then that isn't predatory pricing, it's more of a loss leader strategy, which is totally legal.

 

And Apple's agency model was only part of the antitrust complaint.  The deal to match prices in the iBooks store with any other ebooks store was far more pertinent in making Apple's deals anticompetitive.

censored

Reply

censored

Reply
post #39 of 89
Quote:
Originally Posted by ItsTheInternet View Post
 

 

Amazon still makes a profit on their overall ebook department, so they can only use loss-leaders indefinitely. Apple could already compete on many factors such as having an amazingly best selling tablet. They knew (as shown in the emails) that they couldn't reasonably price things at the wholesale prices ($14.99 or so) if Amazon were willing to sell them for $9.99.

 

Thus Apple could have resigned themselves to selling fewer ebooks, they could have adopted a process of loss-leaders and reduced their income, they could have (and to some extent, did) pioneered new features that the competition didn't have.

 

In fact you can see evidence of this tactic all over the place, for example B&N put a bunch of effort into 'lending' services with the Nook, somewhere Amazon couldn't compete due to their lack of high street presence. This is the sort of competition that these laws enforce. If Amazon truly was predatory pricing then there would be a genuine issue, but as Cote mentioned, the correct procedure to go through is to file a complaint. It is not to orchestrate an illegal price fixing conspiracy that benefits Apple massively.

 

If Apple had just levelled the market without putting themselves at a huge advantage I might have some sympathy, but it's clear that the upper management knew what they were doing and why they were doing it. It certainly wasn't to provide the consumer with direct benefits.


I still don't understand what Apple did to fix the price.  Apple let the publishers set the price.  Apple did not fix the price.  Conspiracy is a word that DOJ and Cote used without really understand high tech. 

post #40 of 89
Quote:
Originally Posted by tzeshan View Post
 


I still don't understand what Apple did to fix the price.  Apple let the publishers set the price.  Apple did not fix the price.  Conspiracy is a word that DOJ and Cote used without really understand high tech. 


What Apple did was to sit in the middle of all of the publishers and offer them a platform that would comply with their demands. Before Apple's involvement the publishers did want to conspire regardless, but they had no way to fight with Amazon. It was unpalatable to them to lose so many sales in order to try and move prices up.

 

Apple provided the iPad, which would comply with their demands and undoubtedly be incredibly popular. They did this knowing full well that it would eliminate retail price competition and so put their platform in a perfect place to sell to their users. Why would anyone install a Kindle app if the prices were exactly the same?

 

This is what Apple did that was illegal, they were involved in orchestrating a conspiracy to eliminate price competition which would directly benefit them. It's a long read, but http://www.justice.gov/atr/cases/f299200/299275.pdf summarises it pretty well.

New Posts  All Forums:Forum Nav:
  Return Home
  Back to Forum: General Discussion
AppleInsider › Forums › General › General Discussion › Apple continues fight to have antitrust monitor reined in, judges appear skeptical