The issue with your argument is that your confusing the retail price that Amazon was charging with the wholesale price they were paying. Amazon was regularly paying 12-15 dollars per book, and discounting to 9.99. Now they are charging 12-15 per book set by the publisher, and they take a 30% cut of the price. So in many cases the authors are actually making less. What the publishers were worried about was not author compensation, they were worried about the effect on the hardback sales as well as amazon getting too large a share of the market. And while I was an early adopter and loved my 9.99 new releases, I understand the publishers concerns with amazon gaining too much power(IE, their recent hardball tactics with a major publisher)
The issue with your perspective is that it doesn't take into the account the sales of physical books. Amazon had already adversely affected the brick and mortar bookstore industry. When they sell physical books, they do not typically take a loss, or even only 30 percent. They can often take some 70 percent. Amazon was leveraging its monopoly in books and products of all kinds, to offer ebooks at a loss. And of course, iBooks doesn't deal in physical books.
The court wanted to deal with Apple's actions exclusively, claiming it was protecting the public from some kind of monopolistic/colluding practices that led to higher prices... All the while ignoring that truely harmful practices come as a result of leveraging power in adjacent markets or industries (horizontal leverage, not vertical integration).
Apple probably did violate anti-trust laws by colluding with other companies. The idea of not being able to sell books at different prices on different stores took away competition.
But, the real criminal here is Amazon. They took ( and often still do take ) 70%, leaving the author with 30%. Apple turned that on its head and gives authors 80% (or is it 70% ?) and keeps the remainder. That's good for authors. It is also good for authors to be able to set their own prices, and not have Amazon discount the books and give the authors less.
Finally, the agency model does not mean that the book must sell at the same price on all stores—that's the "most favored nation" term. The agency model means that the publisher, which is often the author, sets the price, not the retailer, like Amazon. (Speaking of setting the price, can anyone say "iTunes"?
But what is he fixing? Is there one service of Apple's (apart from the newly launched ?Pay) that you could say is best in class? I don't think so. Where is Apple's equivalent to Spotify & YouTube? Why is ?TV so out of date (and now being disrupted by things like Chromecast and Fire Stick)? Why is Siri good but not as great as it could be? And then there's issues with maps...
Like I said earlier perhaps he has too much on his plate and some stuff should be offloaded elsewhere. Cook hiring someone to specifically run cloud services would be a good idea.
Perhaps Apple TV needs to be spun off and be run as a seperate company, because it really seems to be going nowhere.
Apple probably did violate anti-trust laws by colluding with other companies. The idea of not being able to sell books at different prices on different stores took away competition.
But, the real criminal here is Amazon. They took ( and often still do take ) 70%, leaving the author with 30%. Apple turned that on its head and gives authors 80% (or is it 70% ?) and keeps the remainder. That's good for authors. It is also good for authors to be able to set their own prices, and not have Amazon discount the books and give the authors less.
Finally, the agency model does not mean that the book must sell at the same price on all stores—that's the "most favored nation" term. The agency model means that the publisher, which is often the author, sets the price, not the retailer, like Amazon. (Speaking of setting the price, can anyone say "iTunes"?
Yeah but how much do the publisher's take away from the Author? I 've heard many a textbook deal were the book that went for $60 netted the author $1.5. Amazon uses enlightened practises when it comes to take away the middle man, aka the publisher, or at least the publisher that aims to make tons of money (billions) while spreading around peanuts to most of its authors, and a few millions to the names they make world famous via their pr machines, way much worse and much more "criminal" than any publisher.
Apple's 70-30% is extremely fair towards the author (and the publisher/author and the author/publisher) and iTunes Author is a great piece of software. It was badly played due to the collusion deal were the DoJ was given ample rights and reasoning to attack them. (most favored nation term and all).
But both Apple and Amazon (see also crowdsourcing new works of fiction) are revolutionising the business, and the way it stands that they compete now, after the DoJ's intervention is to me fair game. Naturally my heart is with Apple, but Amazon are doing just fine too, they are empowering authors and small publishers and disempowering filthy rich publishing conglomerates.
And imho there's always a place for a bricks and mortar store, they can sell kindle readers, iPads, proper paperbacks, used books, etc. Online shopping complements and enhances parts of the book shopping experience but taking a stroll down your local bricks and mortar store and actually finding some people who care about books they sell to talk to, having a cup of coffee there, getting some e-reading device, a print book or a used book is a very valid business model and should and will survive.
Perhaps Apple TV needs to be spun off and be run as a seperate company, because it really seems to be going nowhere.
Interesting you say that as Ben Thompson wrote a piece on Apple the other day and one of the things he advocated was Apple disbanding their first party software teams (or spinning them off) and just focusing on OS and making the best platform for 3rd party developers.
Interesting you say that as Ben Thompson wrote a piece on Apple the other day and one of the things he advocated was Apple disbanding their first party software teams (or spinning them off) and just focusing on OS and making the best platform for 3rd party developers.
That is a great article and I agree with it for the most part except for the part about spinning off their first party software teams. Apple should have first party software to show case the capability of their platform and as a hedge against any competing software leaving their platform.
Where is it then? The only thing we hear from Cook is that TV is "interesting" and the UI is stuck in the 70s. But he's been saying that for years now. We don't even hear about ?TV rumors now. The only rumors we do hear about are Apple maps employees leaving for Uber and iCloud development being stalled due to organizational issues.
It'll be released when it's good and ready. Cook even mentioned they have secret products that no outsiders knows about.
Sony had a store for its popular e-reader, and Barnes & Noble has a store. People preferred the Kindle, and bought books from Amazon, and kept doing so once they purchased another device through the app.
Ignoring the low prices, do you think it would have been any different if Apple had made the most popular e-reader?
How can you ignore the low prices? Apple and the majority of resellers wants to make money so they will not sell things below cost.
You don't see anything wrong when each publisher told Jobs "we want an agency model but will only do it if everyone else is doing it too."?
Apple has to prove the above conversation never took place. Agency model, Amazon, prices are all irrelevant. As far as I can tell, Eddy Cue keeps saying Apple has customer's best interest in mind and that was never the central point from DoJ.
You can't prove a negative. DOJ has to prove that conversation existed. It didn't.
How can you ignore the low prices? Apple and the majority of resellers wants to make money so they will not sell things below cost.
The point I was trying to make is that Apple could've very well found themselves in the same dominant position that Amazon did had they been first to the ebook market, and had the most popular device.
Comments
The issue with your perspective is that it doesn't take into the account the sales of physical books. Amazon had already adversely affected the brick and mortar bookstore industry. When they sell physical books, they do not typically take a loss, or even only 30 percent. They can often take some 70 percent. Amazon was leveraging its monopoly in books and products of all kinds, to offer ebooks at a loss. And of course, iBooks doesn't deal in physical books.
The court wanted to deal with Apple's actions exclusively, claiming it was protecting the public from some kind of monopolistic/colluding practices that led to higher prices... All the while ignoring that truely harmful practices come as a result of leveraging power in adjacent markets or industries (horizontal leverage, not vertical integration).
But, the real criminal here is Amazon. They took ( and often still do take ) 70%, leaving the author with 30%. Apple turned that on its head and gives authors 80% (or is it 70% ?) and keeps the remainder. That's good for authors. It is also good for authors to be able to set their own prices, and not have Amazon discount the books and give the authors less.
Finally, the agency model does not mean that the book must sell at the same price on all stores—that's the "most favored nation" term. The agency model means that the publisher, which is often the author, sets the price, not the retailer, like Amazon. (Speaking of setting the price, can anyone say "iTunes"?
Perhaps Apple TV needs to be spun off and be run as a seperate company, because it really seems to be going nowhere.
Apple probably did violate anti-trust laws by colluding with other companies. The idea of not being able to sell books at different prices on different stores took away competition.
But, the real criminal here is Amazon. They took ( and often still do take ) 70%, leaving the author with 30%. Apple turned that on its head and gives authors 80% (or is it 70% ?) and keeps the remainder. That's good for authors. It is also good for authors to be able to set their own prices, and not have Amazon discount the books and give the authors less.
Finally, the agency model does not mean that the book must sell at the same price on all stores—that's the "most favored nation" term. The agency model means that the publisher, which is often the author, sets the price, not the retailer, like Amazon. (Speaking of setting the price, can anyone say "iTunes"?
Yeah but how much do the publisher's take away from the Author? I 've heard many a textbook deal were the book that went for $60 netted the author $1.5. Amazon uses enlightened practises when it comes to take away the middle man, aka the publisher, or at least the publisher that aims to make tons of money (billions) while spreading around peanuts to most of its authors, and a few millions to the names they make world famous via their pr machines, way much worse and much more "criminal" than any publisher.
Apple's 70-30% is extremely fair towards the author (and the publisher/author and the author/publisher) and iTunes Author is a great piece of software. It was badly played due to the collusion deal were the DoJ was given ample rights and reasoning to attack them. (most favored nation term and all).
But both Apple and Amazon (see also crowdsourcing new works of fiction) are revolutionising the business, and the way it stands that they compete now, after the DoJ's intervention is to me fair game. Naturally my heart is with Apple, but Amazon are doing just fine too, they are empowering authors and small publishers and disempowering filthy rich publishing conglomerates.
And imho there's always a place for a bricks and mortar store, they can sell kindle readers, iPads, proper paperbacks, used books, etc. Online shopping complements and enhances parts of the book shopping experience but taking a stroll down your local bricks and mortar store and actually finding some people who care about books they sell to talk to, having a cup of coffee there, getting some e-reading device, a print book or a used book is a very valid business model and should and will survive.
Interesting you say that as Ben Thompson wrote a piece on Apple the other day and one of the things he advocated was Apple disbanding their first party software teams (or spinning them off) and just focusing on OS and making the best platform for 3rd party developers.
http://stratechery.com/2014/best/
Interesting you say that as Ben Thompson wrote a piece on Apple the other day and one of the things he advocated was Apple disbanding their first party software teams (or spinning them off) and just focusing on OS and making the best platform for 3rd party developers.
http://stratechery.com/2014/best/
That is a great article and I agree with it for the most part except for the part about spinning off their first party software teams. Apple should have first party software to show case the capability of their platform and as a hedge against any competing software leaving their platform.
It'll be released when it's good and ready. Cook even mentioned they have secret products that no outsiders knows about.
How can you ignore the low prices? Apple and the majority of resellers wants to make money so they will not sell things below cost.
You can't prove a negative. DOJ has to prove that conversation existed. It didn't.
The point I was trying to make is that Apple could've very well found themselves in the same dominant position that Amazon did had they been first to the ebook market, and had the most popular device.