DoJ accuses Apple of prolonging price fixing suit for financial gain

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  • Reply 61 of 86
    anonymouseanonymouse Posts: 7,018member

    Quote:

    Originally Posted by lightknight View Post


    Working with publishers, I can tell you the problem is simple.


    You're selling ebooks for X. You want to sell also on iDevices (same product to you, right?). You're strong-armed in accepting "special conditions". It's Apple terms or no iDevices, and no respect for your previous engagements.


     


    Suppose you have a Y-years old contract going on with Z company that you can distribute to others, but only at a equal or higher price. To distribute with Apple... you can ONLY if your margin was more than 30% AND you cut that margin. Businesswise, it's never going to work, which means you've effectively three choices:


     


    1- drop quality to drop costs


    2- break your existing contracts hoping to make more with Apple


    3- boycott Apple


     


    Apple's big enough that 3 doesn't work out, 1 is never a good solution. Looks like evil to me, looks like evil to the DoJ.


     


    I would however be more inclined to see the DoJ as benevolent here if Amazon.com, like some scary herdmaster of monsters, wasn't hovering behind them...



     


    Yes, well, there are a couple of problems with your scenario, especially for the DoJ. The biggest problem of course is that while, even if we were to assume it to be true, it's evidence of coercion, entirely legal coercion, it actually contradicts the entire premise of the DoJ's accusation of collusion.


     


    However, I prefer to think of Amazon as more the puppeteer. In fact, the whole thing is starting to remind me of "Being John Malkovich", the part where John Cusack has been inside Malkovich for a while and is controlling him controlling life-sized puppets. (You have to love a movie with recursion as a theme.)

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  • Reply 62 of 86
    jragostajragosta Posts: 10,473member
    I still don't entirely understand the basis of these suits buy the DoJ...

    It looked to me like Apple was busting up a "price fixing" scheme mostly kept in place by Amazon… Apple said to publishers

    "charge what you want, charge more if you like"...

    Yes, it led to slightly higher prices on eBooks… and what?

    I don't get what they did wrong… "colluded" with publishers to get their support for their more liberal pricing structure? Is making ANY kind of "deal" now considered "collusion"? "Price fixing"? Is there now one price for all? And when a retailer negotiates with a publisher/wholesaler, they have to talk prices… 

    I don't understand how it can be seen that Apple got together with multiple publishers and "fixed" prices… eBook prices are all over the place, just not constrained by the ceiling imposed by Amazon...

    I prefer lower-priced books, but still… not sure where the lines were crossed here.

    I'm not saying Apple is "innocent", just really don't understand what they're guilty of.

    Obviously, the evidence against Apple is pretty week when the DOJ is stepping up their efforts to try to get Apple to settle. DOJ obviously isn't interested in actually presenting the evidence and trying to win a court case.

    mstone wrote: »
    Find something factually wrong with my post and we can discuss it. I was refering to grammar and syntax and possibly disambiguation as sometimes I misuse proper English. Or perhaps I should just say FU according to the American tradition. smiley23.gif

    It's called 'speaking out of both sides of your mouth' or, if you like, dishonesty.

    You claimed that you were entirely neutral and were not expressing an opinion. I showed that you clearly WERE expressing an opinion and you clearly HAD taken a position in the discussion.

    You can't have it both ways. If you want to be entirely neutral, you have to stop expressing opinions. If you're going to express opinions, you have to stop pretending that you never expressed an opinion.
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  • Reply 63 of 86
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by jragosta View Post





    It's called 'speaking out of both sides of your mouth' 


    As opposed to talking out your ass in your case.

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  • Reply 64 of 86
    jragostajragosta Posts: 10,473member
    mstone wrote: »
    As opposed to talking out your ass in your case.

    I'm not the one who's lying - and then trying to defend the lies with some ridiculous sob story.
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  • Reply 65 of 86
    dasanman69dasanman69 Posts: 13,002member
    jragosta wrote: »
    Then you'd better do something about that fake mstone. He said:
    "The philosophy that a company gives something away for less than cost or at break even prices in order to bring in more customers who might also purchase something considerably more expensive while retrieving their discounted item, has always been a valid business practice. Amazon is legally allowed to do this as long as the purpose is to sell other products and not to create a monopoly. Amazon also gives away the Kindle at less than cost for the same reason."
    It sure sounds like you're claiming that what Amazon did was OK.

    So where were the cries of "bloody murder" during all the years Amazon was allowed to gain such a huge market share? It obviously was okay enough that they've never been sued by the DoJ.
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  • Reply 66 of 86
    jragostajragosta Posts: 10,473member
    dasanman69 wrote: »
    So where were the cries of "bloody murder" during all the years Amazon was allowed to gain such a huge market share? It obviously was okay enough that they've never been sued by the DoJ.

    Really? So you're going to claim that they're innocent because the DOJ never sued them?

    Take a course in critical thinking.
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  • Reply 67 of 86
    jragostajragosta Posts: 10,473member
    Working with publishers, I can tell you the problem is simple.
    You're selling ebooks for X. You want to sell also on iDevices (same product to you, right?). You're strong-armed in accepting "special conditions". It's Apple terms or no iDevices, and no respect for your previous engagements.

    Suppose you have a Y-years old contract going on with Z company that you can distribute to others, but only at a equal or higher price. To distribute with Apple... you can ONLY if your margin was more than 30% AND you cut that margin. Businesswise, it's never going to work, which means you've effectively three choices:

    1- drop quality to drop costs
    2- break your existing contracts hoping to make more with Apple
    3- boycott Apple

    Apple's big enough that 3 doesn't work out, 1 is never a good solution. Looks like evil to me, looks like evil to the DoJ.

    I would however be more inclined to see the DoJ as benevolent here if Amazon.com, like some scary herdmaster of monsters, wasn't hovering behind them...

    So why is a most-favored nation clause OK if Amazon has one but not if Apple asks for one?
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  • Reply 68 of 86


    Does wholesale/retail even mean anything in E-books? I know it does, in that Amazon pays a certain amount to the publisher (wholesale), and charges a certain amount to the customer (retail). But, other than that, there is no cost of inventory sitting on the shelves gathering dust when too much was ordered, or loss of sales opportunity because Amazon or Apple didn't order enough. There is just an ePub file which gets distributed over the Internet and some numbers in a database for how many copies were sold to which customer accounts. 


     


    Also, you can buy a physical book from anyone. You can only buy E-books from a supplier that is compatible with your E-book reader. I buy E-books from Amazon because I can read them on my iPad, but I could still switch to an Amazon Kindle when their eInk gets better. Actually, I prefer the Sony E-Reader, but I don't want to be tied to their platform. 


     


    The DoJ lawsuit is just getting at the wrong problem. Apple taking a 30% cut of its sales is reasonable, and publishers setting the price to sell through its store is reasonable. It is an issue that they are requiring that a book not have a lower electronic price elsewhere, though that is a long-established practice in music and video games, so it is a stretch to argue that it is illegal. 


     


    The real problem is DRM and the resulting lack of device portability. A secondary problem is Apple's requirement that any App that runs on its platform either process all sales through Apple (with its 30% cut) or process all sales entirely outside of the App. That is long established practice in the video game industry, so I really doubt is illegal, but it still heavily distorts the market. 


     


    Maybe some good will come of the lawsuit, even if the basis for it is questionable, if it results in a change to DRM portability or forcing Apple to relax in-App purchasing restrictions. Hopefully, if Apple loses we won't just go back to an Amazon monopoly. Perhaps alternate platforms are now well enough established that an Amazon monopoly is no longer possible. Or, if Apple does lose and Amazon does go back to its obviously predatory pricing, hopefully the DoJ goes after them with equal voracity. 

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  • Reply 69 of 86
    dasanman69dasanman69 Posts: 13,002member
    jragosta wrote: »
    Really? So you're going to claim that they're innocent because the DOJ never sued them?
    Take a course in critical thinking.

    Didn't say they were innocent either, they were definitely using shrewd tactics but I wouldn't say illegal.
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  • Reply 70 of 86
    This lawsuit is so bizarre to me. Amazon's monopoly over this industry was extremely strong and they weren't afraid to abuse it (not to say that would have warranted legislation in its own right). Apple comes along with the others and builds an alternative. It, too, is not all cherry-filled happiness, but it has broken apart the Amazon monopoly and now the market is starting to show some more options. And then the DoJ comes along with what almost seems like a radical fanaticism in defense of Amazon. I can almost picture them frothing at the mouth as they respond to individual steps in the process. I don't think they should be pro-Apple (and allies) all the way in this, but it definitely seems like they shouldn't be extreme-polarized black and white...
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  • Reply 71 of 86
    dasanman69dasanman69 Posts: 13,002member
    tronald wrote: »
    Does wholesale/retail even mean anything in E-books? I know it does, in that Amazon pays a certain amount to the publisher (wholesale), and charges a certain amount to the customer (retail). But, other than that, there is no cost of inventory sitting on the shelves gathering dust when too much was ordered, or loss of sales opportunity because Amazon or Apple didn't order enough. There is just an ePub file which gets distributed over the Internet and some numbers in a database for how many copies were sold to which customer accounts. 

    Also, you can buy a physical book from anyone. You can only buy E-books from a supplier that is compatible with your E-book reader. I buy E-books from Amazon because I can read them on my iPad, but I could still switch to an Amazon Kindle when their eInk gets better. Actually, I prefer the Sony E-Reader, but I don't want to be tied to their platform. 

    The DoJ lawsuit is just getting at the wrong problem. Apple taking a 30% cut of its sales is reasonable, and publishers setting the price to sell through its store is reasonable. It is an issue that they are requiring that a book not have a lower electronic price elsewhere, though that is a long-established practice in music and video games, so it is a stretch to argue that it is illegal. 

    The real problem is DRM and the resulting lack of device portability. A secondary problem is Apple's requirement that any App that runs on its platform either process all sales through Apple (with its 30% cut) or process all sales entirely outside of the App. That is long established practice in the video game industry, so I really doubt is illegal, but it still heavily distorts the market. 

    Maybe some good will come of the lawsuit, even if the basis for it is questionable, if it results in a change to DRM portability or forcing Apple to relax in-App purchasing restrictions. Hopefully, if Apple loses we won't just go back to an Amazon monopoly. Perhaps alternate platforms are now well enough established that an Amazon monopoly is no longer possible. Or, if Apple does lose and Amazon does go back to its obviously predatory pricing, hopefully the DoJ goes after them with equal voracity. 

    If you get rid of DRM then the door for piracy opens up, I don't think that's the answer.
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  • Reply 72 of 86
    russellrussell Posts: 296member


    THIS IS FOR ANYBODY THAT THINKS APPLE IS IN THE RIGHT.


     


    Take Steve Jobs bobblehead out of your a** and go here http://www.ftc.gov/bc/antitrust/antitrust_laws.shtm




    For over 100 years, the antitrust laws have had the same basic objective: to protect the process of competition for the BENEFIT OF THE CONSUMERS, making sure there are strong incentives for businesses to operate efficiently, keep prices down, and keep quality up....



    The Sherman Act outlaws "every contract, combination, or conspiracy in restraint of trade," and any "monopolization, attempted monopolization, or conspiracy or combination to monopolize."...These include plain arrangements among competing individuals or businesses to fix prices, divide markets, or rig bids. These acts are "per se" violations of the Sherman Act; in other words, NO DEFENSE OR JUSTIFICATION ALLOWED....



    The Clayton Act addresses specific practices that the Sherman Act does not clearly prohibit, such as mergers and interlocking directorates (that is, the same person making business decisions for competing companies). Section 7 of the Clayton Act prohibits mergers and acquisitions where the effect "may be substantially to lessen competition, or to tend to create a monopoly."...



    Steve wanted to enter the ebook market, but the profits were too low for his liking. So he colluded with publishers to increase prices, thus violating both laws.

    Some people (mostly booksellers), feel Amazon is a monopoly and that was enough justification for increasing prices. The law says NO.

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  • Reply 73 of 86
    cash907cash907 Posts: 893member

    Quote:

    Originally Posted by lkrupp View Post


    Can we stop with the bovine excrement about how e-book pricing should be a fraction of the print edition. It has NOTHING to do with how much it costs to distribute either form. It's about compensating the author for their intellectual work and artistic endeavor. It is the height of stupidity to equate how much the paper and ink costs with the value of the content. It's not about the book or electronic file, its about what's in it.



     


    You're aware that actual production costs of a hardback book make  up roughly 20-35% of the retail price, correct? What's more, as a physical medium, I am free to lend it to anyone I wish, and there is added value in that as well. What's more, when I purchase a physical book, I own it, DRM free, to with it as I wish for as long as I wish, as long as I'm not copying or digitizing it, and then selling those copies. Books have much more value than an eBook, and pricing them so closely is asinine, as is your rant.

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  • Reply 74 of 86
    jragostajragosta Posts: 10,473member
    cash907 wrote: »
    You're aware that actual production costs of a hardback book make  up roughly 20-35% of the retail price, correct? What's more, as a physical medium, I am free to lend it to anyone I wish, and there is added value in that as well. What's more, when I purchase a physical book, I own it, DRM free, to with it as I wish for as long as I wish, as long as I'm not copying or digitizing it, and then selling those copies. Books have much more value than an eBook, and pricing them so closely is asinine, as is your rant.

    Maybe you should take an economics course. The price is not determined by manufacturing costs. The price is determined by what the consumer will pay. (Although manufacturing costs can sometimes set a floor on the price if the manufacturer is unwilling to sell below cost, but that doesn't apply here). Apparently, the market has decided that eBooks are worth almost as much as physical books. Costs have nothing to do with it.
    russell wrote: »
    THIS IS FOR ANYBODY THAT THINKS APPLE IS IN THE RIGHT.

    Take Steve Jobs bobblehead out of your a** and go here http://www.ftc.gov/bc/antitrust/antitrust_laws.shtm

    For over 100 years, the antitrust laws have had the same basic objective: to protect the process of competition for the BENEFIT OF THE CONSUMERS, making sure there are strong incentives for businesses to operate efficiently, keep prices down, and keep quality up....

    The Sherman Act outlaws "every contract, combination, or conspiracy in restraint of trade," and any "monopolization, attempted monopolization, or conspiracy or combination to monopolize."...These include plain arrangements among competing individuals or businesses to fix prices, divide markets, or rig bids. These acts are "per se" violations of the Sherman Act; in other words, NO DEFENSE OR JUSTIFICATION ALLOWED....

    The Clayton Act addresses specific practices that the Sherman Act does not clearly prohibit, such as mergers and interlocking directorates (that is, the same person making business decisions for competing companies). Section 7 of the Clayton Act prohibits mergers and acquisitions where the effect "may be substantially to lessen competition, or to tend to create a monopoly."...

    Steve wanted to enter the ebook market, but the profits were too low for his liking. So he colluded with publishers to increase prices, thus violating both laws.

    Some people (mostly booksellers), feel Amazon is a monopoly and that was enough justification for increasing prices. The law says NO.


    Blah, blah, blah.

    Instead of just ranting about things you obviously don't understand, why don't you tell us specifically what law Apple has violated and provide evidence to support your position? So far, no one (not even the DOJ) has been able to do that.
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  • Reply 75 of 86
    russellrussell Posts: 296member

    Quote:

    Originally Posted by jragosta View Post





    Blah, blah, blah.

    Instead of just ranting about things you obviously don't understand, why don't you tell us specifically what law Apple has violated and provide evidence to support your position? So far, no one (not even the DOJ) has been able to do that.


     


    In my post I included the link to the FTC's website, the pertinent laws regarding this case and the evidence.


     


    The FTC's mission is to prevent business practices that are anticompetitive, deceptive, or unfair to consumers.


     


    Apple is showboating. They are trying to get sympathy and draw attention away from the true meaning of the laws. They have no case.

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  • Reply 76 of 86
    hill60hill60 Posts: 6,992member

    Quote:

    Originally Posted by Russell View Post


     


    In my post I included the link to the FTC's website, the pertinent laws regarding this case and the evidence.


     


    The FTC's mission is to prevent business practices that are anticompetitive, deceptive, or unfair to consumers.


     


    Apple is showboating. They are trying to get sympathy and draw attention away from the true meaning of the laws. They have no case.



     


    If Apple have no case why don't they just settle?


     


    If the DoJ has a case why are they trying to avoid having to present it?


     


    Apple is innocent, the DoJ has no case.


     


    Apple are guaranteed the presumption of innocence under the constitution of the United States of America,


     


    Allowing the DoJ to override these fundamental rights sets a very dangerous precedent, reminiscent of a police state.


     


    Who will be next on the DoJ hitlist, who will influence them behind the scenes, who will jockey to control this power?


     


    Be careful what you wish for you might just get it.

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  • Reply 77 of 86
    russellrussell Posts: 296member

    Quote:

    Originally Posted by hill60 View Post


     


    If Apple have no case why don't they just settle?


     


    If the DoJ has a case why are they trying to avoid having to present it?


     


    Apple is innocent, the DoJ has no case.


     


    Apple are guaranteed the presumption of innocence under the constitution of the United States of America,


     


    Allowing the DoJ to override these fundamental rights sets a very dangerous precedent, reminiscent of a police state.


     


    Who will be next on the DoJ hitlist, who will influence them behind the scenes, who will jockey to control this power?


     


    Be careful what you wish for you might just get it.



     


     


    Apple is arrogant and will do anything to not admit guilt. They didn't settle for these lawsuits, why do you think they would do it now?


     


    Bait Apps


    No Poaching Class Action


    Apple to refund Australians over 'false' iPad 4G


    ipodlawsuit.com


    iphone4settlement.com


    adaptersettlement.com


    applesecuritiessettlement.com


    "No Refund" Policy Class Action Lawsuit


    Misleading Customers on Warranties in 11 Countries


     


     


    The DOJ is not trying to avoid a trial for the reasons you think. They have an iron clad case against Apple and are trying to avoid the time and costs of a trial when the outcome is obvious.


    There is a legal term for what they are doing. They are asking for a summary judgment, a court order ruling that no factual issues remain to be tried and therefore a cause of action or all causes of action in a complaint can be decided upon certain facts WITHOUT A TRIAL.

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  • Reply 78 of 86
    hill60hill60 Posts: 6,992member

    Quote:

    Originally Posted by Russell View Post


    The DOJ is not trying to avoid a trial for the reasons you think. They have an iron clad case against Apple and are trying to avoid the time and costs of a trial when the outcome is obvious.


    There is a legal term for what they are doing. They are asking for a summary judgment, a court order ruling that no factual issues remain to be tried and therefore a cause of action or all causes of action in a complaint can be decided upon certain facts WITHOUT A TRIAL.



     


    How about I make a complaint about you to the DoJ, giving them an "iron clad case" i.e. tell them anything I want, and they convict you without any trial because there is no need for you to defend yourself.


     


    A VERY dangerous precedent is being set here.

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  • Reply 79 of 86
    jragostajragosta Posts: 10,473member
    russell wrote: »
    The DOJ is not trying to avoid a trial for the reasons you think. They have an iron clad case against Apple and are trying to avoid the time and costs of a trial when the outcome is obvious.

    They'll have the chance to prove it. If they have an iron clad case, they wouldn't be so eager to settle. Politically, it's better for them to actually win a case than to settle, so there'd be no reason for them to settle if their case is ironclad. The cost doesn't concern them in the least.
    russell wrote: »
    There is a legal term for what they are doing.

    Yes, there is. "extortion"
    russell wrote: »
    They are asking for a summary judgment, a court order ruling that no factual issues remain to be tried and therefore a cause of action or all causes of action in a complaint can be decided upon certain facts WITHOUT A TRIAL.

    And Apple argues otherwise. Since DOJ has not proven any of its allegations, their attempts to force a verdict without a trial violates Apple's right to due process.
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  • Reply 80 of 86
    chris_cachris_ca Posts: 2,543member

    Quote:

    Originally Posted by Russell View Post


    Steve wanted to enter the ebook market, but the profits were too low for his liking. So he colluded with publishers to increase prices, thus violating both laws.



    No he/they didn't.

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