Apple, ebook publishers eyed for collusion

Apple, ebook publishers eyed for collusion

Summary: The US Justice Department plans to sue Apple and five US publishers for alleged price-fixing on ebooks, according to The Wall Street Journal.

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TOPICS: Apple
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The US Justice Department plans to sue Apple and five US publishers for alleged price-fixing on ebooks, according to The Wall Street Journal.

Several of the parties expected to be named as defendants have already begun discussions with regulators to head off an expensive antitrust court battle, the newspaper reported, citing sources familiar with the matter. Such a settlement would likely have a ripple effect for the industry; however, not every publisher is engaged in the settlement discussions, they cautioned.

Apple did not immediately respond to a request for comment.

The publishers expected to be named in the lawsuit are HarperCollins Publishers, Hachette Book Group, Macmillan Publishers, Penguin Group and Simon & Schuster "colluded to increase prices" on popular books. (Simon & Schuster is owned by CBS. ZDNet Australia is published by CBS Interactive, a unit of CBS.)

The action is apparently based on changes made to how publishers charge for ebooks when Apple released the first iPad two years ago. Book publishers began using an "agency model" in which publishers set their own ebook prices, rather than the traditional wholesale model in which publishers set a retail price and retailers set their own sales price.

The pricing model materialised in 2010 after book publishers asked Amazon to increase the price of ebooks on its website, but Amazon stood firm in its contention that anything above US$9.99 was too high. Amazon eventually relented after many popular Macmillan titles disappeared from the e-tailer's site.

A lawsuit objecting to the pricing model was filed against Apple and the publishers last year. The plaintiffs alleged that they paid higher prices for their book purchases as a result of the agency model.

Via CNET

Topic: Apple

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  • so the US gummint takes action on price fixing and we all end up paying more? Thats what is going to happen - it will increase the tax cut the US gummint gets though. This is the same sort of gummint meddling that took public housing out of public hands in Australia and into 'private' ownership, constricting supply and jacking house and land prices though the roof, garnering huge tax revenues, inventing 'investment' business where there was none to compensate for the loss of real manufacture & enterprise to asia and means testing baby boomers away from their pensions as long as they own their house... and crudely shifting folks away from the cesspools of our overcrowded cities to vast new vistas of real estate chattleage at vastly overinflated prices...
    nice flip and burn Oz gummint, nice flip and burn US gummint...
    walkerjian@...