Apple Denies Price Fixing. Claims iBookstore Broke Amazon's Monopoly

[techbeck]

Apple has just responded to the US Department of Justice's litigation over price fixing in the ebook market, telling AllThingsDin a statement that the "accusation of collusion against Apple is simply not true." Two days ago the US filed antitrust charges against Apple and five large book publishers, and while three of those publishers decided to settle with the government on the day the suit was filed, Apple, Macmillan, and Penguin have remain defiant. Here's Apple's full comment from spokesperson Tom Newmayr:

The Department of Justice's accusation of collusion against Apple is simply not true. The launch of the iBookstore in 2010 fostered innovation and competition, breaking Amazon's monopolistic grip on the publishing industry. Since then customers have benefited from ebooks that are more interactive and engaging. Just as we've allowed developers to set prices on the App Store, publishers set prices on the iBookstore.

With the statement, Apple joins Macmillan and Penguin in rejecting the government's charges outright. Yesterday, Macmillan's CEO John Sargent published an open letter in which he said the decision to move forward with Apple's agency publishing model was his alone, and that the DOJ's terms for settling were too extreme. Penguin Group chairman John Makinson released a similar statement, arguing that the DOJ's complaint "contains a number of material misstatements and omissions, which we look forward to having the opportunity to correct in court." While half of the original group under investigation was quick to acquiesce to the government's terms, the remaining players are making it clear that they're ready to put up a fight.

http://www.theverge....-responds-ebook

[Brandon H Supervisor]

of course Apple is going to deny it and say it's not true

Apple is just trying to cover their asses while deciding who THEY want to go sue next for stupid reasons

[Cheatyface]

I think we need to get a group picture of these publishing CEOs with Tim Cook so we can put them in the dictionary filed under 'hubris'.

[greenwizard88]

It's nice to see Apple doesn't consider fortune 500 companies to be legitimate competition.

Meanwhile, all I've seen is book prices going up, not down.

Not that Apple would ever lie of course... :rolleyes:

[Boz]

DOJ most likely has the case sealed with witnesses and proof of conspiracy and not to mention blantently obvious fact that prices across the board went up or they wouldn't have so aggressively hit all of them. How is disrupting one's "monopoly" good for consumers when it increases prices.

These guys are truly scum. Not only they conspire and engage in anti-consumer and anti-competitive practices, they do stuff in restaurants and trying to hide their tracks like mafia.

If they have done this for books, can you even begin to imagine what they have been doing with other things where they haven't been caught. I can't even imagine.

[Vandalsquad]

ibookstore broke the monopoly of amazon by raising price's and trying to force amazon to raise there's? To bad amazon called them on there bull****. And apple, let me remove the dam newstand off my ios main screen already as well.

[The Gunslinger]

Lol...doublespeak at its finest!

[Nashy]

I hate Apple as a company, but price fixing? Really. I don't think even Apple are that stupid to think they could get away with it. Someone has probably complained because Apple came in with a product that was better.

[The Gunslinger]

I hate Apple as a company, but price fixing? Really. I don't think even Apple are that stupid to think they could get away with it. Someone has probably complained because Apple came in with a product that was better.

Better for who?

Certainly not customers.

[Nashy]

Better for who?

Certainly not customers.

Why. Because those poor customers can buy a book and read it without moving if they want?

I don't see a massive comapny with as much media and legal scrutiny as Apple, purposely committing a crime of this nature. We aren't talking about the odd patent violation, price fixing is massive.

[gian]

Why. Because those poor customers can buy a book and read it without moving if they want? I don't see a massive comapny with as much media and legal scrutiny as Apple, purposely committing a crime of this nature. We aren't talking about the odd patent violation, price fixing is massive.

According to the posters above you could do that with amazon as well and with lower prices....

[The Gunslinger]

Why. Because those poor customers can buy a book and read it without moving if they want?

I don't see a massive comapny with as much media and legal scrutiny as Apple, purposely committing a crime of this nature. We aren't talking about the odd patent violation, price fixing is massive.

LMAO! Are you seriously discussing this topic, or doing PR spin for apple???

Those poor customers, could also download an ebook on the kindle (or any other device, ipad included) without moving, albeit at a cheaper price. But damn those dirty commies wanting something cheaper!

Did it ever occur to you, that apple in its arrogance thought they would be immune to scrutiny?

[jakem1]

I hate Apple as a company, but price fixing? Really. I don't think even Apple are that stupid to think they could get away with it. Someone has probably complained because Apple came in with a product that was better.

You don't understand what's going on here do you.

[Rudy]

There's a lot of e-bookstores out there, most with their own devices and/or apps to support their "special" format on 3rd party devices (Amazon has an app for the iPad + their own device).

Does Apple have more influence on publishers? Probably, they do have the best selling tablet and publishers want people with tablets to be potential customers

[grik]

Well i must laugh a bit, if iBook is price fixing, what was to be called before? It was Ditacture Fixing.

Im waiting on that argument on the iTunes Music Store too, they just revolutionized the music and book industry....just..!

[rajputwarrior]

can someone explain to me how they are price fixing exactly? I don't use ibooks or amazon's store (i use kobo's on my galaxy tab). but the prices for ebooks are kinda ridiculous and when i notice they are more expensive then paperback or hardcover im just like "wtf?!?!?"

[thommcg]

Why. Because those poor customers can buy a book and read it without moving if they want?

iBooks, available for:

iOS

Mac

Kindle, available for:

iOS

Mac

Windows

Android

Blackberry

Windows Phone 7

Browsers (Chrome, Firefox, Safari on Windows, Mac, Linux and iOS respectively)

Yeah, Apple really liberated users from being forced to move alright :s

[thommcg]

can someone explain to me how they are price fixing exactly? I don't use ibooks or amazon's store (i use kobo's on my galaxy tab). but the prices for ebooks are kinda ridiculous and when i notice they are more expensive then paperback or hardcover im just like "wtf?!?!?"

http://www.pcworld.c...ibookstore.html

Called a "most favored nation clause" (MFN), the language is designed to protect a retailer from price manipulation by a wholesaler. So if a publisher sells the retailer bestseller XYZ for $5, then turns around and sells XYZ to another retailer for $4.50, a most-favored-nation clause would require the publisher to start selling XYZ to the first publisher for $4.50, too.

Apple's deal with the publishers, though, went far beyond guaranteeing competitive prices at the iBookstore, according to the DOJ. It was structured to insulate Apple from any price competition whatsoever.

It did that by requiring the publishers to lower the price of any e-book sold in the iBookstore to match the lowest price of any retailer, even if a publisher didn't have any control over that retailer's price.

So Apple's suggestion that publishers had a free reign to set prices at the iBookstore is a bit disingenuous. Apple indirectly dictated the pricing of e-books at the iBookstore by requiring publishers to sell their wares there at the lowest price found on the Internet.

[rajputwarrior]

http://www.pcworld.c...ibookstore.html

Apple's deal with the publishers, though, went far beyond guaranteeing competitive prices at the iBookstore, according to the DOJ. It was structured to insulate Apple from any price competition whatsoever.

It did that by requiring the publishers to lower the price of any e-book sold in the iBookstore to match the lowest price of any retailer, even if a publisher didn't have any control over that retailer's price.

So Apple's suggestion that publishers had a free reign to set prices at the iBookstore is a bit disingenuous. Apple indirectly dictated the pricing of e-books at the iBookstore by requiring publishers to sell their wares there at the lowest price found on the Internet.

thanks. maybe i'm reading that wrong... but why is that a bad thing? they are just wanting to have the lowest prices possible on their bookstore. wouldn't that be a win for the consumer?

[BoredBozirini]

The DOJ has such an uphill battle against Apple, I'm gonna laugh when they cannot prove Apple conspired.

[Brandon H Supervisor]

thanks. maybe i'm reading that wrong... but why is that a bad thing? they are just wanting to have the lowest prices possible on their bookstore. wouldn't that be a win for the consumer?

but they're not, they've been constantly RAISING prices while kindle leaves their prices around the same price as the physical book

[techbeck]

The DOJ has such an uphill battle against Apple, I'm gonna laugh when they cannot prove Apple conspired.

I am sure they have evidence or proof to backup their claim. Otherwise, if the DOJ didnt have anything..then it would be pretty damn stupid of them to sue. So they have something and its up to the courts to decide if Apple did wrong doing and to weigh the facts.

[BoredBozirini]

I am sure they have evidence or proof to backup their claim. Otherwise, if the DOJ didnt have anything..then it would be pretty damn stupid of them to sue. So they have something and its up to the courts to decide if Apple did wrong doing and to weigh the facts.

They are going by the fact that publishers met at a restaurant in New York or Paris (forgot which one was dinner and which one was lunch), but the key fact is that Apple was not in those meetings.

[thommcg]

thanks. maybe i'm reading that wrong... but why is that a bad thing? they are just wanting to have the lowest prices possible on their bookstore. wouldn't that be a win for the consumer?

Would you say eBook prices the past year have been beneficial to yourself? I wouldn't (For publishers/retailers, sure though I'm a consumer). Over half my wishlist is $12.99+

http://news.cnet.com...-kindle-owners/

"[The settlement] is a big win for Kindle owners," Amazon said in a statement. "We look forward to being allowed to lower prices on more Kindle books."

...

If Amazon is giddy, it might also have something to do with the fact that the company again can pursue its aggressive pricing strategy on e-books, which helped it dominate the market until Apple came along.

Book publishers say that Amazon's price cutting threatens the market because many competitors can't afford to compete against Amazon in a price war.

I'm just waiting for the http://www.ereaderiq.com notifications to start rolling in when they hit my thresholds ;)

[techbeck]

They are going by the fact that publishers met at a restaurant in New York or Paris (forgot which one was dinner and which one was lunch), but the key fact is that Apple was not in those meetings.

All the info is most likely not even known yet so will have to wait and see what happens. So most likely the DOJ has more proof/evidence.