The agency model has always bothered me. If I am a business that sells primarily wholesale, I have made my money in that sale. If the retailer wants to sell at a loss how does that hurt me? I am always amazed that I can go to the mall to five different shoe stores and the price is identical for the same shoe. It is not good for the consumer to not have the opportunity to save money on competitive pricing. For me if an ebook is more than a paperback, I will buy the paperback. That is the advantage of the iPad as it is not dependent on buying books to be a value to me. So Apple gave the publishers a way to raise their prices. The consumer always has the choice to not buy. I actually don't really think that. It is in our DNA to shop. It is ingrained in us. Just watch a 2 year old in the check out line spot that shiny piece of crap and go berserk until it gains possession. We are not at choice, we are addicted and programmed to consume. We have no one to blame for this then ourselves.
I don't. The real world is rarely as simple as one reason. But marketshare was definitely a big part of it. They were selling the hardware at a loss and making a loss on some titles. They have always had loss-leaders in their business model and it's always been about volume not only of customers but sales per customer -- if they can grab your loyalty as a customer losing on some items they will make it up with your overall purchase behavior.
Law firm Hagens Berman filed the original lawsuit last August on behalf of a group of consumers who allege Apple and most of the publishing industry colluded to introduce an agency e-book pricing model for the iBookstore to disrupt Amazon's wholesale model.
I did see that actually but the class as described here is extremely broad and vague and would seem to claim to represent the interests of everyone who has ever bought an ebook.
LOL. I usually ignore obvious fanboy comments. I love Apple but live in reality. But this comment was such over the top fiction that it was too much to ignore. Do you just make this stuff up?
Apple’s deal changed that. By requiring any publisher who wanted their distribution sales platform to contractually agree that no other retailer could have better pricing than Apple, by definition it required publishers to set retail pricing, a practice illegal in print books (but there was no case law for e-books yet).
Whatever the outcome of the case, it is based on solid legal grounds and precedent. Apple’s deals with publishers has removed retail pricing competition from the marketplace. That’s the definition of marketplace collusion. Sure publishers don’t need to make a deal with Apple but when a company with a meaningful share of the marketplace refuses access to the marketplace unless you agree to deals that exclude other companies in the marketplace from fair market competition, there is much case law that says that’s not okay. Similarly, there is already clear legal precedent that its not legal for publishers to enforce fixed retail pricing for books.
I think you may be confused. Horizontal price fixing is per se a violation of Sherman Anti-trust but vertical is not. The publishers are not colluding with each other to fix prices (horizontal) and the retailers (Amazon, Apple, Barnes and Noble, etc) are not colluding to fix retail prices.
The Supreme Court has stated in "[M]ost antitrust claims are analyzed under a “rule of reason,” according to which the finder of fact must decide whether the questioned practice imposes an unreasonable restraint on competition, taking into account a variety of factors, including specific information about the relevant business, its condition before and after the restraint was imposed, and the restraint’s history, nature, and effect." State Oil v. Khan, 522 U.S. 3 (1997).
So, your certainty about how the courts will rule on this matter is quite speculative. You can make your arguments as you like, but the arguments and facts presented by the parties and the court's take on these facts under the "rule of reason" are the only arguments anyone should be interested in.
That said, I can imagine some arguments otherwise. The "same" book could be offered to different retailers under different prices because the features of the ebooks are different. If say, Alice in Wonderland is offered to Apple with highly interactive features, the price of the book can be substantially higher than the "plain" ebook offered by Amazon.
Totally bogus. Letting publishers choose any price they want is not collusion. This lawsuit will fail.
You should read up on collusion. This is a textbook example.
And there are two issues, the collusion and the pricing. On the pricing, what they are doing is already illegal for print books and many other forms of retail products. Manufacturers are always able to set whatever wholesale pricing they want for a consumer product, but rarely control third party retail pricing when they themselves are not a retail seller of the product. What they are doing now is the market equivalent of selling something off selling you something then legally dictating what you re-sell it for on E-Bay or whatever. They are controlling both their direct sale and the secondary sale price. You may feel it is "bogus" on some personal principle, which is your right, but it's certainly not bogus legally. I have no idea how this one will go, but suits like this one often succeed.
You should read up on collusion. This is a textbook example.
And there are two issues, the collusion and the pricing. On the pricing, what they are doing is already illegal for print books and many other forms of retail products. Manufacturers are always able to set whatever wholesale pricing they want for a consumer product, but rarely control third party retail pricing when they themselves are not a retail seller of the product. What they are doing now is the market equivalent of selling something off selling you something then legally dictating what you re-sell it for on E-Bay or whatever. They are controlling both their direct sale and the secondary sale price. You may feel it is "bogus" on some personal principle, which is your right, but it's certainly not bogus legally. I have no idea how this one will go, but suits like this one often succeed.
This does not sound quite right to me. The Supreme Court invalidated laws prohibiting so-called "fair trade" pricing. Manufacturers are free to require retailers of their products to at least advertise prices at MSRP if they want -- and many do. I don't see the big difference in this case.
I did see that actually but the class as described here is extremely broad and vague and would seem to claim to represent the interests of everyone who has ever bought an ebook.
All the better to make more money for the lawyers. I'm excited in anticipation of a check for $2.50.
Prior to the pricing arrangement between Apple and the major publishers Apple that forced every retailer to conform to Apple?s pricing...
...Amazon had a wholesale e-book $13 for $9.99...
...The result was prices shot up substantially on major publisher e-books everywhere and there is now zero price competition in the marketplace ? prices are the same everywhere for major publisher e-books. Books that had been selling for $9.99 on Amazon before the Apple agreement went up to $14.99 and even $19.99.
BULLSHIT!
The market has adjusted there are titles selling well below Amazon's $9.99 FIXED PRICE POINT
The market has adjusted there are titles selling well below Amazon's $9.99 FIXED PRICE POINT
e.g. American Assassin $4.99
Sorry, but you are wrong, both on your point and your example. American Assassin is currently $9.99 on Amazon, Apple and BN.com. LOL. And it's a point of fact that the average price of major publisher bestselling e-books has risen since the Apple deal. This has been published in the NYC, WSJ and numerous other sources. The publishing industry doesn't even deny this. Their response is that the problem is not e-book pricing but that print books are sold cheaper than they should be by retailers.
BTW, priced were never fixed at $9.99 at Amazon. Most titles didn't exceed that but some did, and many titles were always well below that.
Sorry, but you are wrong, both on your point and your example. American Assassin is currently $9.99 on Amazon, Apple and BN.com. LOL. And it's a point of fact that the average price of major publisher bestselling e-books has risen since the Apple deal. This has been published in the NYC, WSJ and numerous other sources. The publishing industry doesn't even deny this. Their response is that the problem is not e-book pricing but that print books are sold cheaper than they should be by retailers.
BTW, priced were never fixed at $9.99 at Amazon. Most titles didn't exceed that but some did, and many titles were always well below that.
Maybe because it's part of a summer sale in the Australian iTunes store along with many other titles at $4.99.
. The "same" book could be offered to different retailers under different prices because the features of the ebooks are different. If say, Alice in Wonderland is offered to Apple with highly interactive features, the price of the book can be substantially higher than the "plain" ebook offered by Amazon.
This is correct. A piece of literary work should have a certain value and that value should be based on the product, not by what a end seller wants to sell it for. An engaging bells and whistles experience should certainly have more value than plain ol' boring white bread.
And it's a point of fact that the average price of major publisher bestselling e-books has risen since the Apple deal. .
I don't quite understand what is wrong with that. Amazon was trying to keep Apple from making profits, and Apple was trying to enhance the experience for us customers by carrying the widest variety of e-books.
If it is good for Apple, then it is good for customers 99% of the time.
F*&K you Americans thinking you control the world with your whiny, petty complaints about prices different to $9.99.
Apple's lawyer "American Assassin is $9.99 on Amazon is that correct?"
Plaintiff "Yes".
Presents evidence of same title at $4.99 in iBooks store.
BAM, case dismissed the claims are shown to be wrong.
This is an American lawsuit based on American laws based on American pricing. Every territory has different agreements, laws, pricing. Aussie pricing is totally irrelevant to this.
So your story continues like this:
Presents evidence of same title at $4.99 on iBooks store.
Prosecution then presents evidence that the price is actually $9.99 on iBooks store and that the defense attempted to commit fraud on the court by quoting an irrelevant pricing in a different market. Judge holds defense in contempt of court...
I don't quite understand what is wrong with that. Amazon was trying to keep Apple from making profits, and Apple was trying to enhance the experience for us customers by carrying the widest variety of e-books.
If it is good for Apple, then it is good for customers 99% of the time.
LOL. I assume your statements were satirical.
Let's see:
1) Amazon wasn't trying to deny Apple anything because they never competed on book sales until after Apple had already established its pricing.
2) Absolutely nothing was preventing Apple from "carrying the widest variety of e-books" before their agency pricing agreements.
Customers benefit from choice and competition, almost always. No one was preventing publishers from charging whatever they wanted for wholesale books. How many of you would be happy if every piece of consumer electronics always sold everywhere for full MSRP, with no exceptions. TV's would cost about 35% more than what the average person pays for them. Hard drives, cameras, you name it. I can't recall the last time I paid MSRP for any consumer electronic product except from Apple. And Apple can charge whatever they want for their products. I'm just glad they don't force every single product the sell in their Apple stores or online to be full MSRP from everyone else like they do with e-books.
I love Apple. They just jumped the shark with this particular area. It happens. Most people see that, even the normal fans. And hardcore Apple can do no wrong people would be defending it no matter what happened.
You should read up on collusion. This is a textbook example.
And there are two issues, the collusion and the pricing. On the pricing, what they are doing is already illegal for print books and many other forms of retail products. Manufacturers are always able to set whatever wholesale pricing they want for a consumer product, but rarely control third party retail pricing when they themselves are not a retail seller of the product. What they are doing now is the market equivalent of selling something off selling you something then legally dictating what you re-sell it for on E-Bay or whatever. They are controlling both their direct sale and the secondary sale price. You may feel it is "bogus" on some personal principle, which is your right, but it's certainly not bogus legally. I have no idea how this one will go, but suits like this one often succeed.
Not seeing any collusion right now.
If we take previous cases of price fixing, like the airlines and fuel surcharges, there were actual meetings held by the airlines, plus a few emails swapped and so forth. The airlines colluded to subvert market forces, and worked against the consumer.
However.
There is a very big difference between airlines and book publishers.
If I want to fly between London and New York, there are many airlines who can sell me a ticket. The service they offer is the same.
However, if I want to buy a Harry Potter book, then I can only buy it through one publisher. Admittedly, I could buy "any" book, but the chances are - I probably won't - I'll buy a book on a recommendation or review or advert. All of these things are specific to a single book. If I want to read about Harry Potter, my choices are limited.
So I'm not sure how publishers can be charged with price fixing when they sell different books. You could say that if you were looking for a book on Madrid there are many choices, but could you imagine a court trying to work out the difference between a Harry Potter book vs a Madrid travel book?
The other issue is quite how Apple are getting dragged into this. The lawyer mentions about companies wanting to retain "profitability" hence turning to Apple. That is not grounds for a price fixing case.
Apple asking for the same terms that other companies get is also not anti-competitive either, and is a common thing. Why would a company write a contract that puts them at a disadvantage? What could be illegal is asking for better terms (eg Google Books) than anyone else, but again, that's not always a bad thing.
Comments
It's a bit naive to think they did it solely for market share.
Confessions of a Publisher: ?We?re in Amazon?s Sights
I don't. The real world is rarely as simple as one reason. But marketshare was definitely a big part of it. They were selling the hardware at a loss and making a loss on some titles. They have always had loss-leaders in their business model and it's always been about volume not only of customers but sales per customer -- if they can grab your loyalty as a customer losing on some items they will make it up with your overall purchase behavior.
You missed something.
The second line if the article to be exact.
Law firm Hagens Berman filed the original lawsuit last August on behalf of a group of consumers who allege Apple and most of the publishing industry colluded to introduce an agency e-book pricing model for the iBookstore to disrupt Amazon's wholesale model.
I did see that actually but the class as described here is extremely broad and vague and would seem to claim to represent the interests of everyone who has ever bought an ebook.
LOL. I usually ignore obvious fanboy comments. I love Apple but live in reality. But this comment was such over the top fiction that it was too much to ignore. Do you just make this stuff up?
Apple’s deal changed that. By requiring any publisher who wanted their distribution sales platform to contractually agree that no other retailer could have better pricing than Apple, by definition it required publishers to set retail pricing, a practice illegal in print books (but there was no case law for e-books yet).
Whatever the outcome of the case, it is based on solid legal grounds and precedent. Apple’s deals with publishers has removed retail pricing competition from the marketplace. That’s the definition of marketplace collusion. Sure publishers don’t need to make a deal with Apple but when a company with a meaningful share of the marketplace refuses access to the marketplace unless you agree to deals that exclude other companies in the marketplace from fair market competition, there is much case law that says that’s not okay. Similarly, there is already clear legal precedent that its not legal for publishers to enforce fixed retail pricing for books.
I think you may be confused. Horizontal price fixing is per se a violation of Sherman Anti-trust but vertical is not. The publishers are not colluding with each other to fix prices (horizontal) and the retailers (Amazon, Apple, Barnes and Noble, etc) are not colluding to fix retail prices.
The Supreme Court has stated in "[M]ost antitrust claims are analyzed under a “rule of reason,” according to which the finder of fact must decide whether the questioned practice imposes an unreasonable restraint on competition, taking into account a variety of factors, including specific information about the relevant business, its condition before and after the restraint was imposed, and the restraint’s history, nature, and effect." State Oil v. Khan, 522 U.S. 3 (1997).
So, your certainty about how the courts will rule on this matter is quite speculative. You can make your arguments as you like, but the arguments and facts presented by the parties and the court's take on these facts under the "rule of reason" are the only arguments anyone should be interested in.
That said, I can imagine some arguments otherwise. The "same" book could be offered to different retailers under different prices because the features of the ebooks are different. If say, Alice in Wonderland is offered to Apple with highly interactive features, the price of the book can be substantially higher than the "plain" ebook offered by Amazon.
Totally bogus. Letting publishers choose any price they want is not collusion. This lawsuit will fail.
You should read up on collusion. This is a textbook example.
And there are two issues, the collusion and the pricing. On the pricing, what they are doing is already illegal for print books and many other forms of retail products. Manufacturers are always able to set whatever wholesale pricing they want for a consumer product, but rarely control third party retail pricing when they themselves are not a retail seller of the product. What they are doing now is the market equivalent of selling something off selling you something then legally dictating what you re-sell it for on E-Bay or whatever. They are controlling both their direct sale and the secondary sale price. You may feel it is "bogus" on some personal principle, which is your right, but it's certainly not bogus legally. I have no idea how this one will go, but suits like this one often succeed.
You should read up on collusion. This is a textbook example.
And there are two issues, the collusion and the pricing. On the pricing, what they are doing is already illegal for print books and many other forms of retail products. Manufacturers are always able to set whatever wholesale pricing they want for a consumer product, but rarely control third party retail pricing when they themselves are not a retail seller of the product. What they are doing now is the market equivalent of selling something off selling you something then legally dictating what you re-sell it for on E-Bay or whatever. They are controlling both their direct sale and the secondary sale price. You may feel it is "bogus" on some personal principle, which is your right, but it's certainly not bogus legally. I have no idea how this one will go, but suits like this one often succeed.
This does not sound quite right to me. The Supreme Court invalidated laws prohibiting so-called "fair trade" pricing. Manufacturers are free to require retailers of their products to at least advertise prices at MSRP if they want -- and many do. I don't see the big difference in this case.
I did see that actually but the class as described here is extremely broad and vague and would seem to claim to represent the interests of everyone who has ever bought an ebook.
All the better to make more money for the lawyers. I'm excited in anticipation of a check for $2.50.
All the better to make more money for the lawyers. I'm excited in anticipation of a check for $2.50.
Don't spend it all in one place. Take a lawyer to lunch.
Prior to the pricing arrangement between Apple and the major publishers Apple that forced every retailer to conform to Apple?s pricing...
...Amazon had a wholesale e-book $13 for $9.99...
...The result was prices shot up substantially on major publisher e-books everywhere and there is now zero price competition in the marketplace ? prices are the same everywhere for major publisher e-books. Books that had been selling for $9.99 on Amazon before the Apple agreement went up to $14.99 and even $19.99.
BULLSHIT!
The market has adjusted there are titles selling well below Amazon's $9.99 FIXED PRICE POINT
e.g. American Assassin $4.99
BULLSHIT!
The market has adjusted there are titles selling well below Amazon's $9.99 FIXED PRICE POINT
e.g. American Assassin $4.99
Sorry, but you are wrong, both on your point and your example. American Assassin is currently $9.99 on Amazon, Apple and BN.com. LOL. And it's a point of fact that the average price of major publisher bestselling e-books has risen since the Apple deal. This has been published in the NYC, WSJ and numerous other sources. The publishing industry doesn't even deny this. Their response is that the problem is not e-book pricing but that print books are sold cheaper than they should be by retailers.
BTW, priced were never fixed at $9.99 at Amazon. Most titles didn't exceed that but some did, and many titles were always well below that.
DaHarder bought 9 of them, 3 each for himself, his wife, and their dog.
Sorry, but you are wrong, both on your point and your example. American Assassin is currently $9.99 on Amazon, Apple and BN.com. LOL. And it's a point of fact that the average price of major publisher bestselling e-books has risen since the Apple deal. This has been published in the NYC, WSJ and numerous other sources. The publishing industry doesn't even deny this. Their response is that the problem is not e-book pricing but that print books are sold cheaper than they should be by retailers.
BTW, priced were never fixed at $9.99 at Amazon. Most titles didn't exceed that but some did, and many titles were always well below that.
Maybe because it's part of a summer sale in the Australian iTunes store along with many other titles at $4.99.
FREE MARKET AT WORK
F*&K you Americans thinking you control the world with your whiny, petty complaints about prices different to $9.99.
Apple's lawyer "American Assassin is $9.99 on Amazon is that correct?"
Plaintiff "Yes".
Presents evidence of same title at $4.99 in iBooks store.
BAM, case dismissed the claims are shown to be wrong.
. The "same" book could be offered to different retailers under different prices because the features of the ebooks are different. If say, Alice in Wonderland is offered to Apple with highly interactive features, the price of the book can be substantially higher than the "plain" ebook offered by Amazon.
This is correct. A piece of literary work should have a certain value and that value should be based on the product, not by what a end seller wants to sell it for. An engaging bells and whistles experience should certainly have more value than plain ol' boring white bread.
And it's a point of fact that the average price of major publisher bestselling e-books has risen since the Apple deal. .
I don't quite understand what is wrong with that. Amazon was trying to keep Apple from making profits, and Apple was trying to enhance the experience for us customers by carrying the widest variety of e-books.
If it is good for Apple, then it is good for customers 99% of the time.
If it is good for Apple, then it is good for customers 99% of the time.
Your blatant Poe-ing is quite transparent.
Steve Jobs winks in agreement.
Maybe because it's part of a summer sale in the Australian iTunes store along with many other titles at $4.99.
FREE MARKET AT WORK
F*&K you Americans thinking you control the world with your whiny, petty complaints about prices different to $9.99.
Apple's lawyer "American Assassin is $9.99 on Amazon is that correct?"
Plaintiff "Yes".
Presents evidence of same title at $4.99 in iBooks store.
BAM, case dismissed the claims are shown to be wrong.
This is an American lawsuit based on American laws based on American pricing. Every territory has different agreements, laws, pricing. Aussie pricing is totally irrelevant to this.
So your story continues like this:
Presents evidence of same title at $4.99 on iBooks store.
Prosecution then presents evidence that the price is actually $9.99 on iBooks store and that the defense attempted to commit fraud on the court by quoting an irrelevant pricing in a different market. Judge holds defense in contempt of court...
I don't quite understand what is wrong with that. Amazon was trying to keep Apple from making profits, and Apple was trying to enhance the experience for us customers by carrying the widest variety of e-books.
If it is good for Apple, then it is good for customers 99% of the time.
LOL. I assume your statements were satirical.
Let's see:
1) Amazon wasn't trying to deny Apple anything because they never competed on book sales until after Apple had already established its pricing.
2) Absolutely nothing was preventing Apple from "carrying the widest variety of e-books" before their agency pricing agreements.
Customers benefit from choice and competition, almost always. No one was preventing publishers from charging whatever they wanted for wholesale books. How many of you would be happy if every piece of consumer electronics always sold everywhere for full MSRP, with no exceptions. TV's would cost about 35% more than what the average person pays for them. Hard drives, cameras, you name it. I can't recall the last time I paid MSRP for any consumer electronic product except from Apple. And Apple can charge whatever they want for their products. I'm just glad they don't force every single product the sell in their Apple stores or online to be full MSRP from everyone else like they do with e-books.
I love Apple. They just jumped the shark with this particular area. It happens. Most people see that, even the normal fans. And hardcore Apple can do no wrong people would be defending it no matter what happened.
You should read up on collusion. This is a textbook example.
And there are two issues, the collusion and the pricing. On the pricing, what they are doing is already illegal for print books and many other forms of retail products. Manufacturers are always able to set whatever wholesale pricing they want for a consumer product, but rarely control third party retail pricing when they themselves are not a retail seller of the product. What they are doing now is the market equivalent of selling something off selling you something then legally dictating what you re-sell it for on E-Bay or whatever. They are controlling both their direct sale and the secondary sale price. You may feel it is "bogus" on some personal principle, which is your right, but it's certainly not bogus legally. I have no idea how this one will go, but suits like this one often succeed.
Not seeing any collusion right now.
If we take previous cases of price fixing, like the airlines and fuel surcharges, there were actual meetings held by the airlines, plus a few emails swapped and so forth. The airlines colluded to subvert market forces, and worked against the consumer.
However.
There is a very big difference between airlines and book publishers.
If I want to fly between London and New York, there are many airlines who can sell me a ticket. The service they offer is the same.
However, if I want to buy a Harry Potter book, then I can only buy it through one publisher. Admittedly, I could buy "any" book, but the chances are - I probably won't - I'll buy a book on a recommendation or review or advert. All of these things are specific to a single book. If I want to read about Harry Potter, my choices are limited.
So I'm not sure how publishers can be charged with price fixing when they sell different books. You could say that if you were looking for a book on Madrid there are many choices, but could you imagine a court trying to work out the difference between a Harry Potter book vs a Madrid travel book?
The other issue is quite how Apple are getting dragged into this. The lawyer mentions about companies wanting to retain "profitability" hence turning to Apple. That is not grounds for a price fixing case.
Apple asking for the same terms that other companies get is also not anti-competitive either, and is a common thing. Why would a company write a contract that puts them at a disadvantage? What could be illegal is asking for better terms (eg Google Books) than anyone else, but again, that's not always a bad thing.