US government files antitrust suit against Apple over e-book pricing [u]

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  • Reply 101 of 251
    Quote:
    Originally Posted by MrStylz View Post


    I'm not sure why Amazon is being brought up so often in this discussion. There are other book sellers...large or small, they are affected by Apple/Publisher price fixing



    To name a few that I can think of, but there will definitely be more:

    Barnes & Noble

    Google

    Amazon

    Apple

    Samsung even has one



    So why the focus on Amazon? The settlement will recreate competition amongst all ebook vendors...large and small. We, the consumers, will be back in charge...



    2 words: monopoly position
  • Reply 102 of 251
    Quote:
    Originally Posted by echosonic View Post


    the best part about the interwebs is that when some socialist liberal know-nothing spouts off on an anti capitalist rant that is not only off topic but intellectually retarded, they can now be met head-on, revealed for the neo communist they are, and refuted with the same simplicity reserved for most belligerent third graders.



    LOL.



    Or they can NOT get rebutted, by someone who fancies himself a creative writer!



    You could have come back with some off-topic citations, or even facts -- but you chose to rant on, and assume anyone who has a problem with shills like Stossel, is a Communist.



    The more I listen to the pro-capitalist dystopians, the more they make Communism sound good -- but you've only convinced me so far that Democratic Socialism is probably a good idea to try.



    >> I'll spread my sweet ideas about liberty and the fifth columnists who are trying to ruin this nation wherever I can -- until YOUR FRIENDS crush dissent on the internet. After that I suppose I'll have to write my rants on bits of paper and tie them to birds.



    Thank GOD you people gave us the Internet -- I thought it was Al Gore and $500 Billion in taxpayer funds to extend a DARPA project.
  • Reply 103 of 251
    [ View article on AppleInsider ][/QUOTE]



    Apple needs to just turn the monetary screws to the Obama/Holder government, and screw them HARD!



    If the government fights this like they did ObamaCare in the Supreme Court, the solicitor general will win this for Apple!
  • Reply 104 of 251
    jukesjukes Posts: 213member
    Quote:
    Originally Posted by island hermit View Post


    Oh, yes, absolutely... Apple could still be guilty of allegedly colluding to raise e-book prices. Just being a part of the negotiations adds Apple to the list; whether you could ultimately change the outcome doesn't exclude you from the alleged crime that was committed.



    Sorry, my sarc-o-meter can't figure out if you're serious or not here, but you can't be guilty of allegedly colluding, only actually colluding. Well, I guess you can be guilty of allegedly colluding but that's not all that useful.



    I have no idea if there was actual collusion (though Steve Jobs' quote from the article sort of implies that there was something going on) or not. I just wanted to point out that the contract itself is perfectly legal and its mechanisms aren't what the DoJ cares about.
  • Reply 105 of 251
    Quote:
    Originally Posted by jukes View Post


    Sorry, my sarc-o-meter can't figure out if you're serious or not here, but you can't be guilty of allegedly colluding, only actually colluding. Well, I guess you can be guilty of allegedly colluding but that's not all that useful.



    I have no idea if there was actual collusion (though Steve Jobs' quote from the article sort of implies that there was something going on) or not. I just wanted to point out that the contract itself is perfectly legal and its mechanisms aren't what the DoJ cares about.



    Oh... you are right. Sorry. I had several thoughts running through my head as I wrote that.



    I'll change it.
  • Reply 106 of 251
    Quote:
    Originally Posted by island hermit View Post


    2 words: monopoly position



    Fair enough - but should consumers not be able to have a choice in the matter? Each book store has their own benefits and drawbacks. Perhaps some people want their entire library via Nook so they can "lend" with their friends. Perhaps this is worth more than than the extra $0.50 (for example) discount they would have via Amazon
  • Reply 107 of 251
    Quote:
    Originally Posted by MrStylz View Post


    Fair enough - but should consumers not be able to have a choice in the matter? Each book store has their own benefits and drawbacks. Perhaps some people want their entire library via Nook so they can "lend" with their friends. Perhaps this is worth more than than the extra $0.50 (for example) discount they would have via Amazon



    Fair enough. Let Amazon have its way and there won't be a Nook library in 3 years.
  • Reply 108 of 251
    gatorguygatorguy Posts: 23,469member
    Quote:
    Originally Posted by SolipsismX View Post


    You have it backwards. Apple never said that their prices dictate what others could minimally sell at, as you claim, all they requested is that if another vendors sells it for less they would sell it for no more than that price on iBookstore.



    Show me proof where Apple said that iBookstore prices are lowest and Amazon could not set the prices lower.



    Amazon cannot sell their books supplied by those 5 publisher's for less than Apple can. Period. Apple may of course choose to sell for more than the publishers set price, not very likely in most cases IMHO.



    What the new model is doing is restricting competition. Rather than Apple needing to decide if they wish to match Amazon's low pricing (or any other competitor for that matter), they've removed that from the equation. Assuming Apple uses the publisher's price, they are guaranteed by those five publishers that Amazon cannot undercut them. Apple has a guaranteed profit of x% and no worries that Amazon can take business from them based on price. Therefor no competitive pricing.



    Then top that off with the DoJ's assertion that Apple met with each of these publishers, proposed the idea guaranteeing Apple a set profit and the resultant restriction on Amazon using price to compete and it's pretty easy to see why the DoJ has a problem with the plan.
  • Reply 109 of 251
    jragostajragosta Posts: 10,473member
    Quote:
    Originally Posted by GoodGrief View Post


    I don't know the exact language of the discussions between Apple and publishers (and I suspect nobody here does either), but if this is relatively accurate:



    "...But we also asked for a guarantee that if anybody else is selling the books cheaper than we are, then we can sell them at the lower price too."



    The translation is:



    "If Amazon gets to sell it for a lower price, then so do we."



    That's hardly Apple dictating a minimum price. That's "we can sell it as cheap as anyone else decides to", not "nobody can sell it cheaper than we decide to". Again, assuming the language from the original post is accurate (or at least representative), then that's the opposite of Apple stipulating the minimum price.



    The problem is that none of us know the deals that Apple signed or the content of the discussions.



    I can see only one possible way that what people are alleging could create an antitrust problem.



    Let's say that there's an eBook that Apple sells on its store for $20 (which means that Apple pays the publisher $14 and keeps $6). Let's say that the publisher charges everyone the same amount for the eBook - $14.



    Now, let's say that Amazon wants to sell that book for $10. Amazon may be willing to take the loss (as they have done on a number of items), but if your interpretation of the events is correct, then Apple could also sell it for $10 - and keep three dollars, giving the publisher $7. Essentially, this type of arrangement would take away the right of a reseller to sell an item at a lower margin than 30% (or even at a loss). I could see that being a potential problem, although I'm not sure it's illegal. I'm absolutely certain that it's not illegal for Apple to demand the same or better wholesale price as everyone else, but it gets more complicated when they start dictating retail prices - since the publisher has no direct control over retail prices in the Amazon model.



    Again, none of us knows what the contracts say, so it's really not worth speculating at this point.
  • Reply 110 of 251
    Quote:
    Originally Posted by Asherian View Post


    Many people seem to not comprehend the issue. The issue is not the agency model (setting their "own price").



    The issue is Apple's condition that no one else ever sell it for less than Apple. This eliminates competition by definition. All other stores must use the price from the iBookStore and never offer it for less. This is quite literally price fixing. Price fixing is most definitely illegal.





    Price fixing is illegal among competitors. Macmillan and Apple are not competing, but have an agreement under which Apple sells books at a price set by MacMillan -- exactly as Apple sells We Are Young, or Angry Birds Space, at prices set by the originators.
  • Reply 111 of 251
    bryandbryand Posts: 78member
    If the publishers are requiring Amazon to match Apple's agency model then they are telling everyone what prices they can sell the ebooks at. No more price competition. I'm not surprised that the publishers like this model, but it seems to me to be exactly what anti-trust legislation was aimed at preventing.
  • Reply 112 of 251
    irelandireland Posts: 17,793member
    Quote:
    Originally Posted by irnchriz View Post


    Apple should fight the US Justice department in court on this, they have more money than the USA anyways, just stretch it out for years and years and the US govt will just go bankrupt. lol



    Are you implying your government is not already bankrupt?
  • Reply 113 of 251
    jukesjukes Posts: 213member
    Quote:
    Originally Posted by Gatorguy View Post


    Amazon cannot sell their books supplied by those 5 publisher's for less than Apple can. Period. Apple may of course choose to sell for more than the publishers set price, not very likely in most cases IMHO.



    What the new model is doing is restricting competition. Rather than Apple needing to decide if they wish to match Amazon's low pricing (or any other competitor for that matter), they've removed that from the equation. Assuming Apple uses the publisher's price, they are guaranteed by those five publishers that Amazon cannot undercut them. Apple has a guaranteed profit of x% and no worries that Amazon can take business from them based on price. Therefor no competitive pricing.



    It's really easy to see why the DoJ sees issues with the plan.



    No. The DoJ has issues with the broad collusion during the contract negotiation. The contract itself is perfectly sound. In fact, according to the WSJ, Random House did not originally agree to the contract and thus is not a defendant in the case, however they signed the same contract last year. If all of the negotiations had been performed independently, in good faith, then all the companies would have the agency model but no lawsuit, like Random House.
  • Reply 114 of 251
    irelandireland Posts: 17,793member
    Quote:
    Originally Posted by emig647 View Post


    Aren't they already bankrupt



    Quit reading my mind.
  • Reply 115 of 251
    Quote:
    Originally Posted by island hermit View Post


    Fair enough. Let Amazon have its way and there won't be a Nook library in 3 years.



    We can disagree on that point. I believe each major vendor will be just fine in 3 years. Amazon is by no means the monopoly nor single choice in ebooks. I believe that when there is competition, the consumers will be the ultimate winners.
  • Reply 116 of 251
    tooltalktooltalk Posts: 766member
    Quote:
    Originally Posted by Asherian View Post


    I know many people here are Apple fans...but look at this objectively.



    Since Apple's price fixing with publishers (and make no mistake, that's what the "minimum book price" is exactly), the cost of new novels for eBooks has gone up from $9.99 to nearly $20. It is literally cheaper for me to go to the local brick & mortar store and buy a brand new hardcover than to download an eBook.



    There's nothing wrong with Apple's agency model. The problem is with them mandating a minimum (high) book price that no one can undercut. That, quite literally, eliminates competition.



    If Google or Amazon did this, the lot of you would be screaming bloody murder. Time for some objectivity, no?



    just scanned through the DOJ's filing. It seems like the big 5 publishers and Apple were colluding together to force agency model on retailers/smaller publishers and set the price level. (they are some juicy stuff about how the publishers responded to Amazon's refusal to carry McMillans' ebooks & hardcopy).



    Down with Apple's anti-competitive practice!
  • Reply 117 of 251
    gatorguygatorguy Posts: 23,469member
    Quote:
    Originally Posted by jukes View Post


    No. The DoJ has issues with the broad collusion during the contract negotiation. The contract itself is perfectly sound. In fact, according to the WSJ, Random House did not originally agree to the contract and thus is not a defendant in the case, however they signed the same contract last year. If all of the negotiations had been performed independently, in good faith, then all the companies would have the agency model but no lawsuit, like Random House.



    Your were apparently replying before noting the edit made a minute or so later.



    This is what you missed:

    "Then top that off with the DoJ's assertion that Apple met with each of these publishers, proposed the idea guaranteeing Apple a set profit and the resultant restriction on Amazon using price to compete and it's pretty easy to see why the DoJ has a problem with the plan."
  • Reply 118 of 251
    christophbchristophb Posts: 1,482member
    Quote:
    Originally Posted by SolipsismX View Post


    This is sound...
    Publishers also worried that retailers such as Barnes & Noble Inc. would be unable to compete with Amazon's steep discounting, leaving just one big buyer able to dictate prices in the industry.

    This isn't...
    In essence, they feared suffering the same fate as record companies at Apple's hands, when the computer maker's iTunes service became the dominant player by selling songs for 99 cents.
    Apple isn't selling an album for 99¢, they are selling a single song with a different bitrate which makes the content inherently different. Furthermore, remember all the bitching about how the iTMS was more expensive than buying a CD? Finally, when Amazon and Wal-Mart started selling songs they sold them for less money than Apple so you can't say that Apple had the same model as Amazon (who also got a higher bit rate and DRM-free songs before Apple, thus making their product 3x as attractive).





    " Government lawyers have questioned how competition could have increased when prices went up. Amazon declined to comment."



    The above was by far my favorite. If accurate, how ignorant are those Gov lawyers? Amazon sells ebooks at a loss then making up the difference on other stuff. Now that there's another player in the eBook game using a different platform, What has been the impact on the price of the Kindle? What has been the impact of the prices of that other stuff Amazon was hiking up? What improvements have been done on the Amazon reader/tablet line? How has the consumer benefitted? Amazon has had to adapt and improve.



    It's so odd that the DoJ seems to consider a book only as the paper in a binding and not the content. I guess this is why the model of subsidizing eBooks with higher prices on other stuffs went unnoticed. That was certainly an inhibiter on new competition entering the eBook section of the market. It's the content of the book that is under copyright - produced, distributed, sold and protected. Is the content somehow worth less based on the medium or delivery method? The market for that content is the same whether it is a brick-n-motor selling it on paper or Internet sales of it on paper or digital download to a proprietary platform.
  • Reply 119 of 251
    jukesjukes Posts: 213member
    Quote:
    Originally Posted by tooltalk View Post


    just scanned through the DOJ's filing. It seems like the big 5 publishers and Apple were colluding together to force agency model on retailers/smaller publishers and set the price level.



    Yes. This is key. There's nothing illegal about the agency model or the most favored nation clause, it's how the negotiation was done (allegedly). This is why Random House, which agreed to exactly the same terms, but not during the same negotitation, isn't being sued.
  • Reply 120 of 251
    Quote:
    Originally Posted by MrStylz View Post


    We can disagree on that point. I believe each major vendor will be just fine in 3 years. Amazon is by no means the monopoly nor single choice in ebooks. I believe that when there is competition, the consumers will be the ultimate winners.



    Amazon was halted in its tracks by the Agency model and yet still maintains an 80% share of the ebook market (figures vary but every one that I have seen puts Amazon above the 75% level that courts view as a monopoly).



    If publishers are forced back to the Wholesale model, Amazon will be re-energized and I can see it viciously regaining any ground that it has lost.



    I'll copy your comment for future use.
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