Penguin will pay $75M back to e-book buyers over alleged price fixing

Apple, accused "ringmaster," still not admitting to conspiracy.

Read the whole story

 

[Roguish]

It'll be interesting to see what comes out at the trial, assuming it really does happen. From everything I've read, and in light of all the settlements by publishers, I don't see how Apple gets out of this unscathed.

Anyhow, I will anxiously await my 10% off coupon to the e-book retailer of my choice as "compensation" for the wrongs done to me as an e-book purchaser.

 

[reflex-croft]

Great news. One of the nice things about the Obama administration has been its willingness to go after market failures like this.

 

[reflex-croft]

Roguish[/url]":1s2e8zzv]It'll be interesting to see what comes out at the trial, assuming it really does happen. From everything I've read, and in light of all the settlements by publishers, I don't see how Apple gets out of this unscathed.

Anyhow, I will anxiously await my 10% off coupon to the e-book retailer of my choice as "compensation" for the wrongs done to me as an e-book purchaser.

I can't speak to others, but Amazon has been directly refunding customers.

 

[SuperSpy]

And that $75M is what percentage of their illegal e-book revenue?

 

[SPCagigas]

Roguish[/url]":17m0ez01]It'll be interesting to see what comes out at the trial, assuming it really does happen. From everything I've read, and in light of all the settlements by publishers, I don't see how Apple gets out of this unscathed.

I think this is where that Steve Jobs email that was being bandied about last week becomes problematic for Apple. It shows that the pricing strategy went straight up to the top...

 

[Freebeau]

Let's hope they didn't have to admit to any wrong-doing. I'd hate for their reputation to be tarnished by screwing consumers.

 

[Roguish]

SuperSpy[/url]":1n6x0qrn]And that $75M is what percentage of their illegal e-book revenue?

Well, from what I can find for 2011 and 2012, here are the numbers for Penguin:

2011
12% of total revenue from ebooks
1.02 billion pounds in total revenue
122.4 million pounds in revenue from ebooks

2012
17% of total revenue from ebooks
1.05 billion pounds in total revenue
178.8 million pounds in revenue from ebooks

If you use the current conversion rate from pounds to dollars, that's $455 million in revenue for 2011 and 2012. If you assume that they would have been selling at $9.99 a pop instead of $12.99 a pop, that's a total 'illegal' revenue of about $105 million.

I'm sure it's a lot more complicated than that, and I'm sure not every ebook they sold yielded an extra $3. I'd guess at best they just had to give back the extra revenue, and maybe even didn't have to give all of it back.

 

[brazuca]

SPCagigas[/url]":1lpjsogt]

Roguish[/url]":1lpjsogt]It'll be interesting to see what comes out at the trial, assuming it really does happen. From everything I've read, and in light of all the settlements by publishers, I don't see how Apple gets out of this unscathed.

I think this is where that Steve Jobs email that was being bandied about last week becomes problematic for Apple. It shows that the pricing strategy went straight up to the top...

The full email communications just doesn't give the sense that there was any colluding. It's Apple negotiating one-on-one to get HC on board. Steve mentions that others have already signed deals, but that it about it. Steve's mention of prices is what he thinks the market will settle on, based on the economics.

To prove collusion, the Feds will need to show that there was coordination, etc. Maybe there is more evidence out there, but the email chain just shows a hard nosed negotiation, one-on-one.

Read the whole email chain for yourself: http://qz.com/87184/the-steve-jobs-emai ... gotiation/

 

[MisterGrumps]

I think we need to bring Matt Damon in here to dig deeper into this price fixing.

Oh god that was a terrible movie.

On topic: What do consumers actually get? $3 back per penguin book they bought? % off future purchases?

 

[SPCagigas]

brazuca[/url]":2whvlj35]

SPCagigas[/url]":2whvlj35]

Roguish[/url]":2whvlj35]It'll be interesting to see what comes out at the trial, assuming it really does happen. From everything I've read, and in light of all the settlements by publishers, I don't see how Apple gets out of this unscathed.

I think this is where that Steve Jobs email that was being bandied about last week becomes problematic for Apple. It shows that the pricing strategy went straight up to the top...

The full email communications just doesn't give the sense that there was any colluding. It's Apple negotiating one-on-one to get HC on board. Steve mentions that others have already signed deals, but that it about it. Steve's mention of prices is what he thinks the market will settle on, based on the economics.

To prove collusion, the Feds will need to show that there was coordination, etc. Maybe there is more evidence out there, but the email chain just shows a hard nosed negotiation, one-on-one.

Read the whole email chain for yourself: http://qz.com/87184/the-steve-jobs-emai ... gotiation/

I have, and without seeing the rest of the Feds' case, we can only speculate. If this is the only piece of evidence they have, then, yes, it's just hard-nosed negotiation. If there are other emails to other publishers, or internal memos, etc., then this may be the figurative smoking gun -- it's more than a generic "I'm aware of this" message, it's the CEO of the company getting into specifics about pricing with one of their suppliers, and pointedly saying a few things that will be hard to explain away:
1. "I’d appreciate it if we can keep this between you and me"
2. "All the major publishers tell us that Amazon’s $9.99 price for new releases is eroding the value perception of their products in customer’s minds, and they do not want this practice to continue for new releases."
3. "Apple is the only other company currently capable of making a serious impact, and we have 4 of the 6 big publishers signed up already."

These three points are going to be difficult to defend -- especially when put in front of a jury. "Keep this between you and me" might only mean "let's talk directly, not through our representatives" but most will interpret this as "I want to keep this secret". "All the major publishers tell us" and "we have 4 of the 6 big publishers signed up already" implies that this same conversation has been had with the other publishing houses. I don't think it takes very much more than this to leave Apple in a real bind in this case...

 

[qasimq]

Hate the fact that Apple colluded with these big name publishers to screw over the consumer.
I have no love for any corporation but I have to hand it Amazon trying to shake up the publisher business without the expense of consumers.

 

[PhilipStorry]

brazuca[/url]":2y16jsvl]Read the whole email chain for yourself: http://qz.com/87184/the-steve-jobs-emai ... gotiation/

OK. I just did. Let's look at your statement...

brazuca[/url]":2y16jsvl]The full email communications just doesn't give the sense that there was any colluding. It's Apple negotiating one-on-one to get HC on board. Steve mentions that others have already signed deals, but that it about it. Steve's mention of prices is what he thinks the market will settle on, based on the economics.

You must have linked to the wrong email.

The email that you linked to clearly shows:
1. Jobs (Apple) knew that Amazon had set a price for books
2. Jobs (Apple) knew that price was lower than the one the publishers wanted - and that Amazon was losing money in order to reach that price
3. Jobs stated that with Apple, they could have a price that was much closer to the one that the publishers wanted
4. Jobs had "4 of 6" on board already, and was trying to get all the big publishers on board

The only thing that didn't jump out at me in the email was the MFN clause - but that evidently came along at some point.

To prove collusion, the Feds will need to show that there was coordination, etc. Maybe there is more evidence out there, but the email chain just shows a hard nosed negotiation, one-on-one.

The coordination was clearly done by Apple. The email chain seems to show that very clearly, and that it was a policy that went all the way to the top of Apple.

A conspiracy doesn't need everyone in the room, contributing equally. You can be part of a conspiracy just by knowing about it and agreeing to participate in it - even if passively so as not to "rock the boat".

In this case, the facts seem clear:
1. Apple pushed all the publishers to set higher prices and make them MFN with iBooks
2. The publishers agreed to that

That's price fixing, plain and simple.

The publishers don't need to be too involved - or even all involved at the same time. They all knew, as they were clearly being told by Apple, that the prices were going to be fixed at a specific level. They knew that they were getting the same deal.
Maybe they did - or maybe they didn't - talk to each other to confirm Apple's statements. But they didn't need to in order to make this collusion.

If you find that email chain that shows Apple to be innocent, please be sure to post the link...

 

[Dak7]

I don't really see how the DoJ can win this case. In the 1979 BMI vs CBS case, the Supreme Court ruled that "not all arrangements among actual or potential competitors that have an impact on price are per se violations." There was a similar ruling in 2007 (Leegin vs PSKS).

What Apple was trying to do was get the industry to adopt a specific business model (the agency model), which isn't against antitrust. Nor are MFN conditions.

Apple was also a new entrant into the market (Amazon had over 90% market share), so it's hard to see how they could argue Apple had sufficient influence over market prices. It's not just the publishers who supported Apple either, but authors, and brick and mortar resellers (ie, Amazon's competition) too.

Read what Scott Turow, president of the Authors Guild, wrote last year:

Amazon was using e-book discounting to destroy bookselling, making it uneconomic for physical bookstores to keep their doors open... Two years after the agency model came to bookselling, Amazon is losing its chokehold on the e-book market: its share has fallen from about 90 percent to roughly 60 percent... Brick-and-mortar bookstores are starting to compete through their partnership with Google, so loyal customers can buy e-books from them at the same price as they would from Amazon. Direct-selling authors have also benefited, as Amazon more than doubled its royalty rates in the face of competition... The irony bites hard: our government may be on the verge of killing real competition in order to save the appearance of competition.

A number of people seem to be focusing on a singular point (that prices increased - something the Supreme Court has ruled is not sufficient to warrant a violation) and are missing the intent (to increase competition). It's obvious that Amazon is engaging in predatory pricing, which should be the real focus.

 

[ataraxia_]

It's obvious that Amazon is engaging in predatory pricing

At $9.99 per e-book?

 

[Dak7]

PhilipStorry[/url]":64z6qwvw]

brazuca[/url]":64z6qwvw]Read the whole email chain for yourself: http://qz.com/87184/the-steve-jobs-emai ... gotiation/

OK. I just did. Let's look at your statement...

brazuca[/url]":64z6qwvw]The full email communications just doesn't give the sense that there was any colluding. It's Apple negotiating one-on-one to get HC on board. Steve mentions that others have already signed deals, but that it about it. Steve's mention of prices is what he thinks the market will settle on, based on the economics.

You must have linked to the wrong email.

The email that you linked to clearly shows:
1. Jobs (Apple) knew that Amazon had set a price for books
2. Jobs (Apple) knew that price was lower than the one the publishers wanted - and that Amazon was losing money in order to reach that price
3. Jobs stated that with Apple, they could have a price that was much closer to the one that the publishers wanted
4. Jobs had "4 of 6" on board already, and was trying to get all the big publishers on board

The only thing that didn't jump out at me in the email was the MFN clause - but that evidently came along at some point.

I don't think you're reading it correctly.

Just to respond to your points:
#1 - This was public knowledge, there's nothing wrong here.
#2 - Jobs knew how much the publishers were selling the books for (to Amazon and to brick-and-mortar shops). This wasn't a price the publishers "wanted", it's what they were already getting (including from Amazon). Again, this isn't exactly secret, nor is there anything wrong with Jobs being aware of it. He SHOULD be aware of it.
#3 - Jobs was calling HC's bluff and stated that the deal Apple was offering was identical to what HC was already getting (from everyone). HC was just asking for more. This is called negotiation, and there's nothing wrong here either.
#4 - Using pre-existing agreements with somebody's competitors to try to isolate them and suggest they'll lose out if they don't agree to the same terms is again, NEGOTIATION. There's, once again, absolutely nothing whatsoever wrong here.

On your last point, MFN clauses are not illegal either.

Really, nothing to see here. If anything, these e-mails vindicate Apple and the publishers, because it suggests there was not collusion (HC was negotiating independently with Apple, and does not seem to have made any agreements about pricing with other publishers).

 

[Dak7]

ataraxia_[/url]":1pcz752h]

It's obvious that Amazon is engaging in predatory pricing

At $9.99 per e-book?

Absolutely. Amazon pays around $12-13 to the publishers for the ebooks. Brick-and-mortar shops pay around $14 for a book, with an MSRP of $28.

Amazon is selling the ebooks for only $9.99, below cost (at a loss). Amazon's competitors, in particular small brick-and-mortar stores, can not compete with Amazon's pricing, since Amazon is selling at a loss.

This doesn't appear to be a sustainable business model for Amazon, but rather is an attempt to drive competitors out of business.

From Google:

pred·a·to·ry pric·ing
Noun
The pricing of goods or services at such a low level that other suppliers cannot compete and are forced to leave the market.

That's pretty much textbook predatory pricing on Amazon's part (and is in fact illegal in the US under antitrust laws, although there are a number of additional hurdles that must be proven to qualify).

 

[dm00]

Derek Kent[/url]":2h5ggukb]I don't really see how the DoJ can win this case. In the 1979 BMI vs CBS case, the Supreme Court ruled that "not all arrangements among actual or potential competitors that have an impact on price are per se violations." There was a similar ruling in 2007 (Leegin vs PSKS).

What Apple was trying to do was get the industry to adopt a specific business model (the agency model), which isn't against antitrust. Nor are MFN conditions.

Apple was also a new entrant into the market (Amazon had over 90% market share), so it's hard to see how they could argue Apple had sufficient influence over market prices. It's not just the publishers who supported Apple either, but authors, and brick and mortar resellers (ie, Amazon's competition) too.

Read what Scott Turow, president of the Authors Guild, wrote last year:

Amazon was using e-book discounting to destroy bookselling, making it uneconomic for physical bookstores to keep their doors open... Two years after the agency model came to bookselling, Amazon is losing its chokehold on the e-book market: its share has fallen from about 90 percent to roughly 60 percent... Brick-and-mortar bookstores are starting to compete through their partnership with Google, so loyal customers can buy e-books from them at the same price as they would from Amazon. Direct-selling authors have also benefited, as Amazon more than doubled its royalty rates in the face of competition... The irony bites hard: our government may be on the verge of killing real competition in order to save the appearance of competition.

A number of people seem to be focusing on a singular point (that prices increased - something the Supreme Court has ruled is not sufficient to warrant a violation) and are missing the intent (to increase competition). It's obvious that Amazon is engaging in predatory pricing, which should be the real focus.

So, wait. Collusion is OK if corporations make more profit?

 

[SPCagigas]

Derek Kent[/url]":2uftn6g5]A number of people seem to be focusing on a singular point (that prices increased - something the Supreme Court has ruled is not sufficient to warrant a violation) and are missing the intent (to increase competition). It's obvious that Amazon is engaging in predatory pricing, which should be the real focus.

Amazon's pricing practices -- whether predatory or not -- are irrelevant in the discussion about whether Apple and the publishers were colluding on prices.

 

[Dak7]

@dm00: I really don't see how you draw that conclusion from my post. Please provide a quote, state your understanding, and why you disagree with it, and I'll try to respond in kind.

@SPCagigas: I think it does matter, since the price increase Apple and the publishers are being accused of colluding to is not a supply side price increase. The publishers were charging $12.99 (including to Amazon) prior to the agreement, and were still charging that same exact price after. The price increase that consumers felt was not due to collusion to increase supply side prices, but was rather due to the ending of Amazon's predatory pricing.

 

[FearLES]

Derek Kent[/url]":3tcuexda]

PhilipStorry[/url]":3tcuexda]

brazuca[/url]":3tcuexda]Read the whole email chain for yourself: http://qz.com/87184/the-steve-jobs-emai ... gotiation/

OK. I just did. Let's look at your statement...

brazuca[/url]":3tcuexda]The full email communications just doesn't give the sense that there was any colluding. It's Apple negotiating one-on-one to get HC on board. Steve mentions that others have already signed deals, but that it about it. Steve's mention of prices is what he thinks the market will settle on, based on the economics.

You must have linked to the wrong email.

The email that you linked to clearly shows:
1. Jobs (Apple) knew that Amazon had set a price for books
2. Jobs (Apple) knew that price was lower than the one the publishers wanted - and that Amazon was losing money in order to reach that price
3. Jobs stated that with Apple, they could have a price that was much closer to the one that the publishers wanted
4. Jobs had "4 of 6" on board already, and was trying to get all the big publishers on board

The only thing that didn't jump out at me in the email was the MFN clause - but that evidently came along at some point.

I don't think you're reading it correctly.

Just to respond to your points:
#1 - This was public knowledge, there's nothing wrong here.
#2 - Jobs knew how much the publishers were selling the books for (to Amazon and to brick-and-mortar shops). This wasn't a price the publishers "wanted", it's what they were already getting (including from Amazon). Again, this isn't exactly secret, nor is there anything wrong with Jobs being aware of it. He SHOULD be aware of it.
#3 - Jobs was calling HC's bluff and stated that the deal Apple was offering was identical to what HC was already getting (from everyone). HC was just asking for more. This is called negotiation, and there's nothing wrong here either.
#4 - Using pre-existing agreements with somebody's competitors to try to isolate them and suggest they'll lose out if they don't agree to the same terms is again, NEGOTIATION. There's, once again, absolutely nothing whatsoever wrong here.

On your last point, MFN clauses are not illegal either.

Really, nothing to see here. If anything, these e-mails vindicate Apple and the publishers, because it suggests there was not collusion (HC was negotiating independently with Apple, and does not seem to have made any agreements about pricing with other publishers).

What's illegal and clear to everyone but you (RDF) is that Apple colluded to fix prices with the publishers so that no one could sell below them, thus removing price competition, and they forced this model on Amazon.

Amazon using a perfectly legal loss leader strategy on best selling ebooks has nothing to do with Apple colluding on prices.

 

[Arsification]

dm00[/url]":12qnco2o]

Derek Kent[/url]":12qnco2o]I don't really see how the DoJ can win this case. In the 1979 BMI vs CBS case, the Supreme Court ruled that "not all arrangements among actual or potential competitors that have an impact on price are per se violations." There was a similar ruling in 2007 (Leegin vs PSKS).

What Apple was trying to do was get the industry to adopt a specific business model (the agency model), which isn't against antitrust. Nor are MFN conditions.

Apple was also a new entrant into the market (Amazon had over 90% market share), so it's hard to see how they could argue Apple had sufficient influence over market prices. It's not just the publishers who supported Apple either, but authors, and brick and mortar resellers (ie, Amazon's competition) too.

Read what Scott Turow, president of the Authors Guild, wrote last year:

Amazon was using e-book discounting to destroy bookselling, making it uneconomic for physical bookstores to keep their doors open... Two years after the agency model came to bookselling, Amazon is losing its chokehold on the e-book market: its share has fallen from about 90 percent to roughly 60 percent... Brick-and-mortar bookstores are starting to compete through their partnership with Google, so loyal customers can buy e-books from them at the same price as they would from Amazon. Direct-selling authors have also benefited, as Amazon more than doubled its royalty rates in the face of competition... The irony bites hard: our government may be on the verge of killing real competition in order to save the appearance of competition.

A number of people seem to be focusing on a singular point (that prices increased - something the Supreme Court has ruled is not sufficient to warrant a violation) and are missing the intent (to increase competition). It's obvious that Amazon is engaging in predatory pricing, which should be the real focus.

So, wait. Collusion is OK if corporations make more profit?

Don't feed the troll. If he doesn't have the where-with-all to spend 5 minutes online to read about the Sherman Anti-Trust Act, and the fact that it was created to protect consumers rights and not suppliers rights, he doesn't deserve a true response.

 

[charleski]

Derek Kent[/url]":1ny06t2t]I don't really see how the DoJ can win this case.

IANAL, but I'm sure that Penguin, Macmillan, and the rest all have excellent teams working for them. Would they have recommended a settlement if they thought they could win? Would the legal fees for an extended case really have reached more than the hundreds of millions the publishers will be paying out?

I think the publishers' lawyers believe the DoJ had a decent chance of winning, and advised their clients accordingly. And I suspect they know what they're talking about.

A number of people seem to be focusing on a singular point (that prices increased - something the Supreme Court has ruled is not sufficient to warrant a violation) and are missing the intent (to increase competition). It's obvious that Amazon is engaging in predatory pricing, which should be the real focus.

I'd agree that an Amazon monopsony is bad as well. But the solution was not to put in place an agency model that caused even more harm to the market.

 

[Dak7]

I am clearly in the minority on this thread, and I don't see any reason to continue the flame war that seems to be starting.

I'd just like to say I'm disappointed and expected better from Ars readers than to hurl ad hominem attacks at me simply because you disagree (@Arsification, @FearLES). I made an honest attempt to reference Supreme Court rulings and quote interested third parties, and to reply with fact-based arguments.

We're clearly not going to settle this case on this board anyway, so I'll just wait to see what the result is and what comes out at trial.

 

[FearLES]

Derek Kent[/url]":1jwvjdy4]I am clearly in the minority on this thread, and I don't see any reason to continue the flame war that seems to be starting.

I'd just like to say I'm disappointed and expected better from Ars readers than to hurl ad hominem attacks at me simply because you disagree (@Arsification, @FearLES). I made an honest attempt to reference Supreme Court rulings and quote interested third parties, and to reply with fact-based arguments.

We're clearly not going to settle this case on this board anyway, so I'll just wait to see what the result is and what comes out at trial.

Where's the adhom in my post?

The DOJ's case seems quite strong especially if Apple is the only hold out and the evidence we've seen seems pretty damning, they even have Jobs on camera all but admitting it. Amazon was clearly forced into selling for prices they didn't want to because of the collusion and the end of it from the publishers folding brought a significant reduction in prices.

 

[Viking ZX]

Ah, this is where the war of zealotry went from the "ringleader" article. Some people will say the craziest things in support of their favorite company. And ignore the truth in front of their own face.

And I'm here to eat popcorn cooked on the flames of their indignation.

 

[Dak7]

FearLES[/url]":2l7zuo8x]Where's the adhom in my post?

You accused me of being under the 'RDF'. I don't think you actually believe a field that can distort reality and people's thoughts is emanating from Cupertino and causing me to come to a conclusion that you disagree with.

In reality, what you are suggesting is that I am somehow a blind Apple supporter, which is a statement about my motives. Ad hominem attacks are an attack on somebody's character or motive.

 

[FearLES]

Derek Kent[/url]":1ijog2b4]

FearLES[/url]":1ijog2b4]Where's the adhom in my post?

You accused me of being under the 'RDF'. I don't think you actually believe a field that can distort reality and people's thoughts is emanating from Cupertino and causing me to come to a conclusion that you disagree with.

In reality, what you are suggesting is that I am somehow a blind Apple supporter, which is a statement about my motives. Ad hominem attacks are an attack on somebody's character or motive.

[trollhide]I am accusing you of bias, sure. It seems like only a fanboi would be able to ignore the facts and be able to defend Apple here.[/trollhide]

 

[Dak7]

FearLES[/url]":2ay92fca]I am accusing you of bias, sure. It seems like only a fanboi would be able to ignore the facts and be able to defend Apple here.

Thanks for proving my point.

 

[Sufinsil]

Government backed class action type lawsuits seem a lot better. If this was a private firm they would be getting a bigger piece of the pie and less to the consumers actually harmed.

 

[Viking ZX]

Derek Kent[/url]":2tkh55lo]

FearLES[/url]":2tkh55lo]I am accusing you of bias, sure. It seems like only a fanboi would be able to ignore the facts and be able to defend Apple here.

Thanks for proving my point.

I don't know. I think you're proving his point much more ably than he has. At this point, unless you admit to playing the devils advocate, you're not really fooling anyone but yourself. You've got 6 companies, all of which have thrown Apple under the bus as the leader of this little conspiracy, testifying in order to reduce their own punishments. You've got e-mails from Steve Jobs directly admitting his intent to collude and raise prices for the consumer to line his own pockets. What more do you want? Steve Job's to rise from his grave and tell you in person "Yes, we colluded. It was illegal, I didn't care, just like all the other times I did something questionable for the money?"

Come on, at this point the case is pretty cut and dry. Unless Apple tries a mass insanity plea, they're going to get slapped.

 

[lvlln]

Derek Kent[/url]":2sjp7edu]

FearLES[/url]":2sjp7edu]Where's the adhom in my post?

You accused me of being under the 'RDF'. I don't think you actually believe a field that can distort reality and people's thoughts is emanating from Cupertino and causing me to come to a conclusion that you disagree with.

In reality, what you are suggesting is that I am somehow a blind Apple supporter, which is a statement about my motives. Ad hominem attacks are an attack on somebody's character or motive.

That's not an ad hominem. An ad hominem has to follow an insult with, "Therefore you are wrong." For example, if he said, "You are deluded by the RDF, therefore what you say is incorrect," that would be ad hom.

The logic in this case goes the opposite direction: you are clearly, blatantly, obviously wrong, and that is evidence that you are under the RDF. It's an observation, an insult, but not an ad hom.

 

[brazuca]

Again, there might be other evidence, but reading the emails from SJ to Murdock shows that there was no collusion there. How could there be if Steve had to inform Murdock that he had other agreements already signed? Wouldn't HC have known this if they were in collusion?

Murdock was also concerned that the other publishers would change their prices and wanted the flexibility to do the same in reaction to that. That is the opposite of collusion. It means "I don't know what they will do, so I want to freedom to react to the competition".

Apple may have signalled to the entire world that it thought that the ebook market should fall inside the certain price points. But that is his opinion. If (*IF) he didn't get the publishers together and sign some sort of blood oath to all agree on the same way to screw over Amazon, there there is nothing wrong with having an objective.

If the negotiations with the other publishers went the same way as with HC, then it points to Apple dividing and conquering: going one-by-one, calling bluffs, bluffing, being hard-nosed, using Apple's weight with iTunes, etc. But that is basic negotiation. Unless iTunes and Apple are some sort of monopoly, they can freely do that.

EDIT: I'd hate to think that the government is ruining Apple's business plans for a shake down...
http://washingtonexaminer.com/tim-carne ... _click=rss

 

[brazuca]

Derek Kent[/url]":1j8i670v]I am clearly in the minority on this thread, and I don't see any reason to continue the flame war that seems to be starting.

I'd just like to say I'm disappointed and expected better from Ars readers than to hurl ad hominem attacks at me simply because you disagree (@Arsification, @FearLES). I made an honest attempt to reference Supreme Court rulings and quote interested third parties, and to reply with fact-based arguments.

We're clearly not going to settle this case on this board anyway, so I'll just wait to see what the result is and what comes out at trial.

There is a strange vitriol that is very uncharacteristic of Ars. Usually people have to show some evidence to back up their claims. Now it is all ad homs and "fanboi". It's like The Verge ran out of room.

 

[dm00]

Derek Kent[/url]":1hxfomjr]@dm00: I really don't see how you draw that conclusion from my post. Please provide a quote, state your understanding, and why you disagree with it, and I'll try to respond in kind.

You wrote this:

Derek Kent[/url]":1hxfomjr]I don't really see how the DoJ can win this case. In the 1979 BMI vs CBS case, the Supreme Court ruled that "not all arrangements among actual or potential competitors that have an impact on price are per se violations." There was a similar ruling in 2007 (Leegin vs PSKS).

But the actual charge against the five has really nothing to do with financials, is has everything to do with getting together with your competitors, and changing the way you do business to lock out someone you don't like/get you more profit (in this case, Amazon was the target).

So when you concluded:

Derek Kent[/url]":1hxfomjr]A number of people seem to be focusing on a singular point (that prices increased - something the Supreme Court has ruled is not sufficient to warrant a violation) and are missing the intent (to increase competition). It's obvious that Amazon is engaging in predatory pricing, which should be the real focus.

You sound like the Collusion piece can simply be overlooked because Amazon's the REAL jerk, here. They're the ones losing money to gain more market share. But if Penguin hated Amazon's Model so much, why did they keep signing distributory contracts with them? Why didn't they just say "We don't like how you're eroding our business (even though you pay the same price as all other distributors), we're done with you"? They didn't do it, because they were worried their competition would sweep them into bankruptcy. Once their competitors agreed (the illegal part of this whole issue) to go in with them for acting bold (against the consumer), then they switched.

For THAT reason, it's bad.

 

[Deleted member 1]

Roguish[/url]":k41v60yz]
If you use the current conversion rate from pounds to dollars, that's $455 million in revenue for 2011 and 2012. If you assume that they would have been selling at $9.99 a pop instead of $12.99 a pop, that's a total 'illegal' revenue of about $105 million.

I'm sure it's a lot more complicated than that, and I'm sure not every ebook they sold yielded an extra $3. I'd guess at best they just had to give back the extra revenue, and maybe even didn't have to give all of it back.

75% of the "illegal" revenue close enough in my book, provided, custumers get 100% of the money.

I have ever since the question came up ( i.e. Apple price e-book fixing ) have said the following:

Steve Job's own words indicate that the goal of any agreement that was formed between the book publishers and Apple was to make a better deal for Apple. The fact the book publishers have settled long ago indicate they are either actually guility or feel they would lose the case ( which lets be honest now likely means they are guility ).

The fact Apple and ALL the book publishers already settled speaks volumes.

 

[Robot Dinosaur]

brazuca[/url]":2xp5xulh]

Derek Kent[/url]":2xp5xulh]I am clearly in the minority on this thread, and I don't see any reason to continue the flame war that seems to be starting.

I'd just like to say I'm disappointed and expected better from Ars readers than to hurl ad hominem attacks at me simply because you disagree (@Arsification, @FearLES). I made an honest attempt to reference Supreme Court rulings and quote interested third parties, and to reply with fact-based arguments.

We're clearly not going to settle this case on this board anyway, so I'll just wait to see what the result is and what comes out at trial.

There is a strange vitriol that is very uncharacteristic of Ars. Usually people have to show some evidence to back up their claims. Now it is all ad homs and "fanboi". It's like The Verge ran out of room.

In my experience the vitriol is mostly just in threads relating to Apple and either its patent lawsuits or antitrust case - things where Apple might be cast in a negative light. Then fanboys show up and derail the discussion, and they can be remarkably insistent, stubborn, and unable to argue clearly or succinctly. I feel like Apple defenders end up judged to a higher standard as a result - if you're not presenting your argument extremely well, people assume the worst of you, and everything goes downhill from there.

 

[brazuca]

Robot Dinosaur[/url]"e4z7jzf]

brazuca[/url]"e4z7jzf]

Derek Kent[/url]"e4z7jzf]I am clearly in the minority on this thread, and I don't see any reason to continue the flame war that seems to be starting.

I'd just like to say I'm disappointed and expected better from Ars readers than to hurl ad hominem attacks at me simply because you disagree (@Arsification, @FearLES). I made an honest attempt to reference Supreme Court rulings and quote interested third parties, and to reply with fact-based arguments.

We're clearly not going to settle this case on this board anyway, so I'll just wait to see what the result is and what comes out at trial.

There is a strange vitriol that is very uncharacteristic of Ars. Usually people have to show some evidence to back up their claims. Now it is all ad homs and "fanboi". It's like The Verge ran out of room.

In my experience the vitriol is mostly just in threads relating to Apple and either its patent lawsuits or antitrust case - things where Apple might be cast in a negative light. Then fanboys show up and derail the discussion, and they can be remarkably insistent, stubborn, and unable to argue clearly or succinctly. I feel like Apple defenders end up judged to a higher standard as a result - if you're not presenting your argument extremely well, people assume the worst of you, and everything goes downhill from there.

this.

 

[dm00]

Actually, my beef is with the publishers. Ebook prices jumped across the board, till they were higher than paperbacks. Higher, with less overhead, less expenses, and less resources. Greed at its finest.

http://www.amazon.com/Cold-Days-Novel-D ... =Cold+Days

Hardcover=$18.75
Kindle=$11.99
Paperback=$8.99

Baffling.

 

[YetAnotherAnonymousAppellation]

Fortunately, none of these publishers are big in the tech book field so I should have no problem avoiding them. All five have now been added to my permanent boycott list (Apple's already on it for other reasons).