Not at a loss? Then why did it take them 12 years to make a profit? And the music industry should've gotten the same treatment from the DoJ that the publishers got for doing that to Apple.
1) Apple said from the start that it was in the black from the start, but it's business acumen isn't in question, it's whether Apple created the iTMS to unfairly give it an advantage by purposely selling at a loss. It's very clear they did not.
2) So I say it's wrong for the DoJ to jump on Apple for giving the publishers freedom to set prices and investigate Amazon for possible dumping to unfairly dominate a market and you say that means I should think Apple should be sued for legally cornering a market by being more convenient despite prices that were deemed more costly from the start? WTF?!
More like $1.29, not selling, $1.19, still not selling, $1.09, selling but not enough, $0.99 yay selling like crazy. Just like Apple did with the iPhone when it first came out. Like Soli said "what a concept!"
1) Apple said from the start that it was in the black from the start, but it's business acumen isn't in question, it's whether Apple created the iTMS to unfairly give it an advantage by purposely selling at a loss. It's very clear they did not.
2) So I say it's wrong for the DoJ to jump on Apple for giving the publishers freedom to set prices and investigate Amazon for possible dumping to unfairly dominate a market and you say that means I should think Apple should be sued for legally cornering a market by being more convenient despite prices that were deemed more costly from the start? WTF?!
So why else would they go into a business venture that makes them no money? Ahhh to sell more iPods, which is worse than what Amazon was doing because one doesn't need a Kindle to read their ebooks.
So why else would they go into a business venture that makes them no money? Ahhh to sell more iPods, which is worse than what Amazon was doing because one doesn't need a Kindle to read their ebooks.
What part of Apple operating in the black don't you understand? Amazon's ebooks were clearly sold well below their cost to corner the market. That doesn't strike you as problematic? What Amazon does for their regular business where they barely make 1% profit or loss money each quarter isn't an issue as they do at least attempt to turn a profit each quarter.
What part of Apple operating in the black don't you understand? Amazon's ebooks were clearly sold well below their cost to corner the market. That doesn't strike you as problematic? What Amazon does for their regular business where they barely make 1% profit or loss money each quarter isn't an issue as they do at least attempt to turn a profit each quarter.
iTunes only recently started operating in the black, it was meant to be a break even venture.
What part of Apple operating in the black don't you understand? Amazon's ebooks were clearly sold well below their cost to corner the market. That doesn't strike you as problematic? What Amazon does for their regular business where they barely make 1% profit or loss money each quarter isn't an issue as they do at least attempt to turn a profit each quarter.
I think it was like "being between a rock and a hard spot".
Apple wanted a full collection of e-books in their new iBookstore.
For the store to be a success, they would have to sell at the same price as the current market leader Amazon
Apple insisted on making 30% but that was more than even the publishers were currently making.
There is only one solution to all three issues. Raise prices and make Amazon raise their prices too.
And if that were to happen, consumers would pay more than they were currently paying.
Amazon's practice of selling SOME books below cost for SOME period of time is no different than any business offering an incentive to customers to shop at their store. Whether the number of books, or the period of time was too great to be regarded as a legitimate business practice, perhaps should be investigated, but that is a separate issue.
The publishers could have told Amazon that they cannot sell below a certain price just like Nikon does with their cameras, but they didn't.
You just don't get it, do you? It's not about Apple's way of selling e-books it's the fact that Apple is late to the ebook market and them trying to make everybody to do things their way.
Sorry, but the book publishers dealt with Amazon not having their collective act together. They didn't have any organized way of putting out a consistent Suggested Retail List price that was consistent so that Apple be competitive with Amazon. That's what Apple was trying to do, have a consistent pricing model where they could actually compete.
I see a lot of weird pricing with Amazon from time to time where their "Retail Price" is inflated to what the mfg suggested retail price is.
Amazon is not always consistent with their pricing.
Before I buy ANYTHING from Amazon, I check with at least two RELIABLE sources to ensure they have proper pricing and that it's actually a goos deal, because some of the things they have the Retail Price is submitted by the reseller and it's not always accurate. Most of the time it is, but there is enough inconsistency to make me think something weird goes on. It's NOT 100% reliable pricing on Amazon.
Sorry, but the book publishers dealt with Amazon not having their collective act together. They didn't have any organized way of putting out a consistent Suggested Retail List price that was consistent so that Apple be competitive with Amazon. That's what Apple was trying to do, have a consistent pricing model where they could actually compete.
I see a lot of weird pricing with Amazon from time to time where their "Retail Price" is inflated to what the mfg suggested retail price is.
Amazon is not always consistent with their pricing.
Before I buy ANYTHING from Amazon, I check with at least two RELIABLE sources to ensure they have proper pricing and that it's actually a goos deal, because some of the things they have the Retail Price is submitted by the reseller and it's not always accurate. Most of the time it is, but there is enough inconsistency to make me think something weird goes on. It's NOT 100% reliable pricing on Amazon.
And I say since when did Apple care about the price someone else has? Offer a superior experience at a premium price, isn't that their MO? Why is this different?
Somehow, Amazon managed to undercut Apple's pricing by 10% when it started selling MP3s (2007). If Apple is dumping, then what of Amazon?
Undercutting them in what? Music? I've already stated that if the music industry and Amazon colluded against Apple then they should've been investigated as well, but the problem is nobody complains about lower prices. Btw I'll ask again, didn't consumers still choose Apple?
And I say since when did Apple care about the price someone else has? Offer a superior experience at a premium price, isn't that their MO? Why is this different?
Because they are reselling a product that is not exclusive to Apple. On the products that Apple manufactures, they can set the price high because they are providing a better user experience. In the case of e-books the experience is in the reading. Apple only controls the device the book is being read on not the actual content of the book.
Because they are reselling a product that is not exclusive to Apple. On the products that Apple manufactures, they can set the price high because they are providing a better user experience. In the case of e-books the experience is in the reading. Apple only controls the device the book is being read on not the actual content of the book.
And I say since when did Apple care about the price someone else has? Offer a superior experience at a premium price, isn't that their MO? Why is this different?
You don't get it. For large resellers of digital content, the supplier (book publisher, etc.) has to set a Retail Price, and then give a REASONABLE wholesale cost and then let each price the content at either retail or offer a discount. How much they ultimately charge is up to each reseller, but there has to be some consistent way of establishing a Retail List Price. In the case of songs, Apple felt that charging $.99 cents a song was REASONABLE at the time and they needed to make a certain amount of profit to cover the costs Akamai was charging them, marketing/adverstising costs, maintaining the iTunes website/software, etc. It was a new business model that no one really had a handle on in the beginning. Then the prices of the songs slowly increased as they started removing DRM and/or increasing the bit rates which increases the size of each file to give a better quality listening experience. It was new and the entertainment industry went to Apple asking for their help in trying to figure it out.
No, Apple is not typically going to sell something at cost or at a loss. Apple pays Akamai a certain amount per download which comes off of the top and Apple retains what is left over from the margin they are given.
Apple is not trying to rip people off, all they want is to give a good experience to the customer and make a REASONABLE profit. If Amazon wants to charge less money to attract buyers, then that's what Amazon does. Amazon is working on very low profit margins because they spend pretty much ZERO on R&D, they are more of just a fulfillment house rather than a company that actually develops something. I don't even think they actually design their Kindles, I think they go to another company, give them pricing and spec parameters and then have basically private label someone else's tablets. Go look at Amazon's Income Statements. They don't spend a dime on R&D. It's all SG&A expenses and they work on a fairly low profit margin. They also lost money last year. A company can't stay in business continually losing money, can they?
Then do what Apple does best and offer a better customer experience at a premium. Don't I read that time, and time again on here, and how no other company gets that? Why is it any different now?
So why else would they go into a business venture that makes them no money? Ahhh to sell more iPods, which is worse than what Amazon was doing because one doesn't need a Kindle to read their ebooks.
I can listen to music on my Mac. I don't need an iPod.
I only said it was always meant to be a break even venture, I never said it was designed to corner a market.
That's what they said at first, but note that break even does not mean sell at a loss. There was never any suspicion that Apple used any anti-competitive dumping techniques with iTMS. In fact, I think they profited quite well the entire time with their "break even" statement being a worse case scenario that never happened because it was so successful do to the added convenience of the store. If I were going to market a new service that more expensive per CD and that had DRM to customers as well as needing to get content from very fearful content owners who were afraid of the digital era I would also say that we've designed it to (at least) break even. None of that is the selling at a loss model you keep claiming is what Apple did with iTMS.
I think they do, and buyers pay extra for that in the cost of the device. I don't see why that cost has to be embedded into the media, and not the device.
I think a reasonable person could come to the conclusion that one party coordinated the negotiations for all. I think it's equally likely that the publishers got caught talking amongst each other.
The coordination of the announcement is not an indication (to me) that the agreement to the exact same conditions is a clear sign of Apple colluding or price fixing. Is it naive for me to consider that the publishers all saw a better deal, the same deal offered to each by Apple, and took it? Perhaps but until I read evidence of Apple's collusion or disclosure of communications or details of negotiations between publishers I'll withhold judgement.
Either scenario is possible. Apple calls the different publishing houses and says, "publisher A is going to sell through our store and their price is going to be x amount. Would you like to sell through our store as well?" Or one publisher calls up another and says, "We're going to sell through the Apple store and we think x amount sounds like a fair price. What do you think?" Neither scenario would constitute price fixing, it only becomes price fixing when one party asks the other to set a specific price. Just talking about pricing does not constitute price fixing - no agreement has been made. There also exists a third scenario, that selling online makes pricing to be near instantly adjustable. The second that I find out what prices my competitors have set, I move my price point so I am in line with the rest. In business if I am offering a similar service or product as my competition, I don't want to have the highest prices and chase customers away, and I don't want the lowest prices and leave money on the table.
Comments
1) Apple said from the start that it was in the black from the start, but it's business acumen isn't in question, it's whether Apple created the iTMS to unfairly give it an advantage by purposely selling at a loss. It's very clear they did not.
2) So I say it's wrong for the DoJ to jump on Apple for giving the publishers freedom to set prices and investigate Amazon for possible dumping to unfairly dominate a market and you say that means I should think Apple should be sued for legally cornering a market by being more convenient despite prices that were deemed more costly from the start? WTF?!
More like $1.29, not selling, $1.19, still not selling, $1.09, selling but not enough, $0.99 yay selling like crazy. Just like Apple did with the iPhone when it first came out. Like Soli said "what a concept!"
So why else would they go into a business venture that makes them no money? Ahhh to sell more iPods, which is worse than what Amazon was doing because one doesn't need a Kindle to read their ebooks.
What part of Apple operating in the black don't you understand? Amazon's ebooks were clearly sold well below their cost to corner the market. That doesn't strike you as problematic? What Amazon does for their regular business where they barely make 1% profit or loss money each quarter isn't an issue as they do at least attempt to turn a profit each quarter.
deleted
iTunes only recently started operating in the black, it was meant to be a break even venture.
Show proof that iTunes Store was operating at a loss and was designed to operate at a loss to unfairly corner the digital market.
Quote:
Originally Posted by SolipsismX
What part of Apple operating in the black don't you understand? Amazon's ebooks were clearly sold well below their cost to corner the market. That doesn't strike you as problematic? What Amazon does for their regular business where they barely make 1% profit or loss money each quarter isn't an issue as they do at least attempt to turn a profit each quarter.
I think it was like "being between a rock and a hard spot".
Apple wanted a full collection of e-books in their new iBookstore.
For the store to be a success, they would have to sell at the same price as the current market leader Amazon
Apple insisted on making 30% but that was more than even the publishers were currently making.
There is only one solution to all three issues. Raise prices and make Amazon raise their prices too.
And if that were to happen, consumers would pay more than they were currently paying.
Amazon's practice of selling SOME books below cost for SOME period of time is no different than any business offering an incentive to customers to shop at their store. Whether the number of books, or the period of time was too great to be regarded as a legitimate business practice, perhaps should be investigated, but that is a separate issue.
The publishers could have told Amazon that they cannot sell below a certain price just like Nikon does with their cameras, but they didn't.
I only said it was always meant to be a break even venture, I never said it was designed to corner a market.
Somehow, Amazon managed to undercut Apple's pricing by 10% when it started selling MP3s (2007). If Apple is dumping, then what of Amazon?
Quote:
Originally Posted by dasanman69
You just don't get it, do you? It's not about Apple's way of selling e-books it's the fact that Apple is late to the ebook market and them trying to make everybody to do things their way.
Sorry, but the book publishers dealt with Amazon not having their collective act together. They didn't have any organized way of putting out a consistent Suggested Retail List price that was consistent so that Apple be competitive with Amazon. That's what Apple was trying to do, have a consistent pricing model where they could actually compete.
I see a lot of weird pricing with Amazon from time to time where their "Retail Price" is inflated to what the mfg suggested retail price is.
Amazon is not always consistent with their pricing.
Before I buy ANYTHING from Amazon, I check with at least two RELIABLE sources to ensure they have proper pricing and that it's actually a goos deal, because some of the things they have the Retail Price is submitted by the reseller and it's not always accurate. Most of the time it is, but there is enough inconsistency to make me think something weird goes on. It's NOT 100% reliable pricing on Amazon.
And I say since when did Apple care about the price someone else has? Offer a superior experience at a premium price, isn't that their MO? Why is this different?
Undercutting them in what? Music? I've already stated that if the music industry and Amazon colluded against Apple then they should've been investigated as well, but the problem is nobody complains about lower prices. Btw I'll ask again, didn't consumers still choose Apple?
Quote:
Originally Posted by dasanman69
And I say since when did Apple care about the price someone else has? Offer a superior experience at a premium price, isn't that their MO? Why is this different?
Because they are reselling a product that is not exclusive to Apple. On the products that Apple manufactures, they can set the price high because they are providing a better user experience. In the case of e-books the experience is in the reading. Apple only controls the device the book is being read on not the actual content of the book.
Then provide a better reading experience.
Quote:
Originally Posted by dasanman69
And I say since when did Apple care about the price someone else has? Offer a superior experience at a premium price, isn't that their MO? Why is this different?
You don't get it. For large resellers of digital content, the supplier (book publisher, etc.) has to set a Retail Price, and then give a REASONABLE wholesale cost and then let each price the content at either retail or offer a discount. How much they ultimately charge is up to each reseller, but there has to be some consistent way of establishing a Retail List Price. In the case of songs, Apple felt that charging $.99 cents a song was REASONABLE at the time and they needed to make a certain amount of profit to cover the costs Akamai was charging them, marketing/adverstising costs, maintaining the iTunes website/software, etc. It was a new business model that no one really had a handle on in the beginning. Then the prices of the songs slowly increased as they started removing DRM and/or increasing the bit rates which increases the size of each file to give a better quality listening experience. It was new and the entertainment industry went to Apple asking for their help in trying to figure it out.
No, Apple is not typically going to sell something at cost or at a loss. Apple pays Akamai a certain amount per download which comes off of the top and Apple retains what is left over from the margin they are given.
Apple is not trying to rip people off, all they want is to give a good experience to the customer and make a REASONABLE profit. If Amazon wants to charge less money to attract buyers, then that's what Amazon does. Amazon is working on very low profit margins because they spend pretty much ZERO on R&D, they are more of just a fulfillment house rather than a company that actually develops something. I don't even think they actually design their Kindles, I think they go to another company, give them pricing and spec parameters and then have basically private label someone else's tablets. Go look at Amazon's Income Statements. They don't spend a dime on R&D. It's all SG&A expenses and they work on a fairly low profit margin. They also lost money last year. A company can't stay in business continually losing money, can they?
Because they don't own the media.
I can listen to music on my Mac. I don't need an iPod.
That's what they said at first, but note that break even does not mean sell at a loss. There was never any suspicion that Apple used any anti-competitive dumping techniques with iTMS. In fact, I think they profited quite well the entire time with their "break even" statement being a worse case scenario that never happened because it was so successful do to the added convenience of the store. If I were going to market a new service that more expensive per CD and that had DRM to customers as well as needing to get content from very fearful content owners who were afraid of the digital era I would also say that we've designed it to (at least) break even. None of that is the selling at a loss model you keep claiming is what Apple did with iTMS.
I think they do, and buyers pay extra for that in the cost of the device. I don't see why that cost has to be embedded into the media, and not the device.
Quote:
Originally Posted by ChristophB
I think a reasonable person could come to the conclusion that one party coordinated the negotiations for all. I think it's equally likely that the publishers got caught talking amongst each other.
The coordination of the announcement is not an indication (to me) that the agreement to the exact same conditions is a clear sign of Apple colluding or price fixing. Is it naive for me to consider that the publishers all saw a better deal, the same deal offered to each by Apple, and took it? Perhaps but until I read evidence of Apple's collusion or disclosure of communications or details of negotiations between publishers I'll withhold judgement.
Either scenario is possible. Apple calls the different publishing houses and says, "publisher A is going to sell through our store and their price is going to be x amount. Would you like to sell through our store as well?" Or one publisher calls up another and says, "We're going to sell through the Apple store and we think x amount sounds like a fair price. What do you think?" Neither scenario would constitute price fixing, it only becomes price fixing when one party asks the other to set a specific price. Just talking about pricing does not constitute price fixing - no agreement has been made. There also exists a third scenario, that selling online makes pricing to be near instantly adjustable. The second that I find out what prices my competitors have set, I move my price point so I am in line with the rest. In business if I am offering a similar service or product as my competition, I don't want to have the highest prices and chase customers away, and I don't want the lowest prices and leave money on the table.