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Judge OKs Class Action Suit Against Apple For E-Book Price Fixing

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  • by Anonymous Coward

    The fact that anybody can't is quite disturbing. Obviously there is a major problem with the system and a class action lawsuit should go forward. The publishers who are forcing DRM and giving discriminatory pricing should be prohibited.

    • by Anonymous Coward

      What about the AUTHORS! Seems that greed and corporate collusion has forgotten the actual content creators. Why don't authors self publish, shouldn't be too diffucult with to days technology? Cut out the middle man altogether. But if too many start doing that it'll probably be outlawed.

      • by Wootery (1087023)

        I agree that self-publication on the web would probably generally be a good thing for authors and readers, but I can think of a few obstacles:

        1. Marketing isn't easy or free
        2. Authors might be in favour of DRM, which means going with a big name publisher
        3. They might have sold their soul and be forced to publish through some company
        • Re: (Score:2, Informative)

          by Anonymous Coward

          As an author with more than 10 self published works for sale on Amazon, you can be sure that I have not sold my soul to the devil (a.k.a. Publishers).
          Having tried to sell my works via my own site I can tell you that even with the amazon cut I make a lot more money using them than I did before.
          As for the costs to the purchaser? Well two of my books are available at £0.99 anf the highest price is £5.99. Hardly breaking the bank for purchasers. If I printed the book and got it into book stores the

          • As an author with more than 10 self published works for sale on Amazon, you can be sure that I have not sold my soul to the devil (a.k.a. Publishers).

            No, you sold your soul to Amazon. And without evil Apple they'd still take 65% of the selling price.

        • I agree that self-publication on the web would probably generally be a good thing for authors and readers, but I can think of a few obstacles:

          1. Marketing isn't easy or free

          Nor is marketing necessary. I don't think I've seen a lot of marketing for books over the years. Sure, one or two here or there. You see more marketing for a single movie than you probably have in your entire life for books.

          • by Wootery (1087023)

            Reasonable point, but I suspect there's a lot of value in simply being listed on Amazon.

            • by s1sfx (1883880)

              Reasonable point, but I suspect there's a lot of value in simply being listed on Amazon.

              No, not really. There is so much listed on Amazon that without marketing to get people to click on a link any book or ebook just goes under without a trace. Single celled organism in an ocean kind of a deal. The ability of people to self publish to Amazon has created this ocean.

              • by Meski (774546)
                Amazon is good, but it could be a lot better. I buy a lot of books thru kindle app on Android (don't get me started on the cripple-ware apple forced amazon to do) - what could they do better?
                -not recommend books I've already bout thru amazon
                -allow me to flush existing recommended books and get a new set of recommendations (if its on the list for a month, and I haven't bought it, I'm not going to.
                -tag and buy, rather than the atrocity that is one click buy
                -multiple accounts per one device, and an easy
      • Umm... lulu [lulu.com]?
      • Nah, just get Google involved, you could have an e-book page to search on Google. Call it www.google.e-book.com
      • Why don't authors self publish, shouldn't be too diffucult with to days technology? Cut out the middle man altogether.

        Self publishing *is* difficult - and a lot more work than you think because now the author has to do all the marketing, all the site maintenance, all the accounting, all the everything that isn't writing. Assuming a middle man is nothing but a leech is foolish, in many cases they actually do provide valuable services. Middle men didn't arise just by chance or malfeasance, nor do they pers

      • by ZorglubZ (3530445)
        Oh, it may be easy, but it's not cheap, in either time or in money... if you want a good book to be the result of your efforts. Charles Stross, http://www.antipope.org/charli... [antipope.org] , had a series of posts about this a couple years ago (can't find the specific posts, sorry). First, there's proofreading - you're unlikely to spot your own errors in a 40,000-word novel, because you know what you meant and will be blind to typos. Then there's editoring, checking for continuity errors and/or anachronisms? Same as ab
        • by Meski (774546)
          I'd happily tag and submit errors I spot back to them, if there was a trivially easy way of doing it.
    • Bingo.

      And it wouldn't be hard to deploy ebooks like that either.

      Have an open DRM standard for ebooks. Publishers license the ebook shops to distribute those open standard ebooks. Have the standard be something that works on the Nook and the Kindle and whatever else. Its not a big deal.

      There after, the publishers won't just be dealing with Amazon. So if some book seller is giving them a hard time they can simply refuse to sell to them and instead be comfortable that enough of their books will sell elsewhere

      • Not sure what you mean by "push an author". They may entice an author, but there's not one thing they can do to to "push" an author in any direction except the enticements the publisher (e or otherwise) can offer.
        • if they're price fixing books then what does that mean? Are you suggesting they did it in collusion with the publishers?

          If so, then the publishers are party to the conspiracy but they're not named so they weren't.

          Which means apple was setting prices for books which is not something they should have a role in doing.

          They should instead set their percentage or fee for listing a book and perhaps a per transaction fee per download.

          Short of that, they have no reason to care what price publishers or authors charge

    • Content distributers rip off the artist and the consumer at the same time. They destroy creativity and resist innovation. Where have I heard this before?

      I happened to know a small time author and he distributes through amazon. The price of his ebooks is the same as the price of a real book. Yet amazon pays him less for an ebook sale than a real book. He has no choice in the matter. So he tells everyone to buy the paper copy if they can. Seems like bullshit to me.

      • If your friend is pricing his ebook the same as a paper book (his decision alone), he's doing it wrong. You also neglect details. Who's doing the actual publishing, putting the ink to paper? They naturally exert expense and delay.

        As for your first paragraph, it's simply bias on your part and not at all supported by fact. If they "resist innovation" please tell me how the whole ebook thing took off? It wasn't the indies that spurred it.
    • There are precious few markets in which "anybody" can open a store and compete successfully against the big established players. Go out on the high street and you mostly see franchises and big-name stores. E-books are little different, but I do agree that there seems to be too much collusion between distributors like Amazon and the publishers. Diesel has just gone out of business and Sony are pulling out of e-readers: it's a tough market. Nonetheless, there are e-book distributors out there who aren't Amazo
  • by kramerd (1227006) on Saturday March 29, 2014 @12:44AM (#46608227)

    Anyone you accuse of participating in a cartel should be sued for dissolution, not monetary damages.

    • by Luthair (847766)
      Or the executives should get jailtime - why should white collar crime be treated differently?
      • by Anonymous Coward

        Because they pay judges and politicians a lot of money to make it different.

      • Re: (Score:2, Funny)

        by Alan Warrick (3422939)
        This should be thrown out of court. Apple is too big to fine. It would shake consumer confidence. If anything I think they need a bailout so that they do not have to resort to these unfair and unethical practices. I think that also Apple should be declared a official State to offer sovereign immunity to protect against any further lawsuits.. I also think they should rescind any legislature that allows for oversight of apple's finances and tax havens. Please vote for me I'm running for Congress 2k16. I plea
      • Because you don't imprison non-violent offenders. They present no real danger. Just confiscate their key to the executive bathroom and take away their parking space. That will put the fear of god into their heathen souls.

        • Bernie Maddoff, Jeff Skilling.

          • What about 'em? I'd rather see them outside facing the glare of angry eyes. What benefit do we derive from locking them up? It's much better to have have them working at McDonalds so we can garnish their wages.

    • yeah, small change. but they have to sue for demonstrable loss.
      perhaps if more join the amount could go up.

      The serious problems for Apple will be the conditions of the settlement.
      • by dk20 (914954)
        Funny, RIAA doesn't have to use "demonstrable losses" when it sues. Perhaps they could have a $250,000 per ebook overcharged "set fine" similar to music?
  • So how do I sign up for my $1.00 iTunes credit?
  • Despite the legal action (and victories) by the DoJ it doesn't seem to me like we've had any price drops to reurn us to the pre-cartel pricing. So apparently these guys get a slap on the wrist and will get to keep the fruits of their bad behaviour?

    • by click2005 (921437) *

      Slap on the wrist? I bet any settlement includes the text "Apple admits no wrongdoing".

    • by Rosyna (80334) on Saturday March 29, 2014 @01:49AM (#46608395) Homepage

      Amazon, using its monopoly power in ebooks, kept prices artificially low. When Apple entered the market, Amazon lost some of its monopoly power and publishers used this event to increase eBook prices across the board.

      • by tuppe666 (904118) on Saturday March 29, 2014 @02:04AM (#46608427)

        Amazon, using its monopoly power in ebooks, kept prices artificially low. When Apple entered the market, Amazon lost some of its monopoly power and publishers used this event to increase eBook prices across the board.

        From http://www.justice.gov/atr/cas... [justice.gov] Page 160 "Amazon screwed it up. It paid the wholesale price for some books, but started selling them below cost at $9.99. The publishers hated that — they thought it would trash their ability to sell hardcover books at $28. So before Apple even got on the scene, some booksellers were starting to withhold books from Amazon. So we told the publishers, “We’ll go to the agency model, where you set the price, and we get our 30%, and yes, the customer pays a little more, but that’s what you want anyway.” 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. So they went to Amazon and said, “You’re going to sign an agency contract or we’re not going to give you the books.”"

      • So in this case, the Justice department swoops in to punish the one group preventing Amazon from owning the ebook market as a monopoly.

        I love WalMart prices folks, but Amazon was going to own this whole game. WalMart prices go up, you'll notice, in areas where there are no other big competitors. If the #1 Bookseller has cheaper books and doesn't have the Agency Model -- then how the Hell is Apple price fixing?

        Apple's prices sucked and most people were not going to buy from them unless they had plenty of mon

      • by organgtool (966989) on Saturday March 29, 2014 @11:21AM (#46609715)
        There is so much wrong with that statement, I hardly know where to begin. First of all, monopolies take advantage of the lack of competition to keep prices artificially high, not low. Secondly, even if Amazon was keeping prices artificially low, what they were doing was completely legal. On the other side, Apple was found guilty of conspiring with publishers to make it absolutely impossible for other resellers to sell their books cheaper than Apple. If Apple had just demanded that they got the same or lower price on ebooks as other resellers, then they would have likely escaped litigation. Instead, they conspired with publisher to fix the prices that other resellers could actually sell their products and that is classic price fixing. The publishers knew that and promptly pled guilty, but Apple thought they could get one by the legal system and got a sudden dose of reality. This isn't just another typical case of Slashdot hating on Apple - in this case there is legal justification for it and mountains of legal precedence.
        • On the other side, Apple was found guilty of conspiring with publishers to make it absolutely impossible for other resellers to sell their books cheaper than Apple. If Apple had just demanded that they got the same or lower price on ebooks as other resellers, then they would have likely escaped litigation.

          The situation is quite a bit more nuanced than that, and you've got your basic facts surrounding the case slightly wrong, since what you've stated Apple should have done is exactly what Apple did do. But, strangely, they also did what you said in your first sentence too. The illegal collusion and price fixing that's happened here revolves primarily around the interplay of two otherwise-perfectly-legal ideas: the agency model and most favored nation (MFN) clauses.

          Agency Model: The agency model allows the pub

  • How is setting the minimum price of books different than setting the minimum price of apps?
    • good point, but!
      apps are platform specific, books aren't
      when you buy an iphone you buy into the platform. why I won't buy an iphone.

      It costs more up front, I've only bought unlocked phones.
      actually cheaper in the long run.
      • Re: (Score:2, Insightful)

        by wiredlogic (135348)

        Minimum price agreements were widely used in the heyday of CDs. The practice was upheld by courts.

        • by tuppe666 (904118) on Saturday March 29, 2014 @02:14AM (#46608439)

          Minimum price agreements were widely used in the heyday of CDs. The practice was upheld by courts.

          I noticed this gets modded up as fact...the truth is a little more interesting http://www.stereophile.com/new... [stereophile.com] this is an article from 2000 where the Big Five got in trouble with the Federal Trade Commission for "Minimum Advertised Pricing on CDs" where retailers were forbidden to *advertise* CDs below an established minimum. Unlike Apple they had heard of Sherman Antitrust Act

          • Unlike CDs, Apple only set a *maximum* price. The eBook publishers were free to set any price they wanted, even $1 a book. The reason prices went up to that maximum is because eBooks were more valuable than the wholesale or lower price Amazon was selling them for.

            • No Apple did more than that. They told them what prices to sell at and that all their competators would sell at that price.

              To dramatize the immediate increase in the price of e-books that the Publishers could achieve under the Apple agency agreement, and to assure each Publisher Defendant that it was being treated no differently than its competitors, Moerer sent a table of proposed book prices to them in identical e-mails on The Draft Agreement capped e-book prices at $12.99 for New Release titles with hardcover list prices of $30 or under, and set a $14.99 price tier cap for New Release titles with hardcover list prices above $30, with incremental price tier increases for every $5 increase in the hardcover list price above $30. For books other than New Releases, the price cap was set at $9.99. The January 4 term sheet had set a price cap at $14.99 for any book with a hardcover list price above $35, and $12.99 for any hardcover book listed below $35. The Draft Agreement, by contrast, set the demarcation between $12.99 and $14.99 at $30, allowing for higher e-book prices in relation to a title’s hardcover list price. the same day Apple sent out the Draft Agreements. The table showed fiction NYT Bestsellers from every member of the Big Six. It listed the book’s title, author, and publisher. It showed each title’s hardcover list price, followed by its retail prices when sold as an Amazon hardcover book; Amazon e-book; Barnes & Noble e-book; and finally, as a proposed iTunes e-book. The proposed prices under the iTunes column were always either $12.99 or $14.99, and were always several dollars higher than the then-existing e-book price at Amazon and Barnes & Noble. In some cases, the iTunes e-book price was even higher than the Amazon hardcover price.31 Sensitive to the fact that the table looked like an Apple retail price list, Moerer clarified in a follow-up email to Shanks that the prices in the table’s final column designating the “iTunes eBook Retail Price” are the “top price tier we’ve proposed” and that “[i]n the agency model, Penguin would set retail prices at its sole discretion, at this price or any lower price, with Apple acting as your agent.” While the final column would only display Apple’s e-book prices for titles published by the particular Publisher receiving that version of the table, the layout made it easy for the Publishers to see that they were all being treated identically

    • The difference is "price fixing” (a specific legal term) only applies when multiple vendors collude to set a price and effectively stifle competition. In the case of a sole vendor there is no competition, so they can legally set whatever price they want; this isn’t “price fixing”.

      • So in this case it is apple and multiple publishers colluding?

        I failed to see how this is different?

        Perhaps I am missing something?
        • So in this case it is apple and multiple publishers colluding?

          Well, that is the question. The judge (the same one as in this case) declared that they were before the court case even started. Publishers who were willing to declare in the court that Apple wasn't part of any collusion were not allowed to testify in court. There is no actual evidence of collusion other than the judge's strong belief.

          And it would be perfectly legal for Apple to offer the same contract to all publishers and all publishers accepting it, unless they all discuss that between themselves and

          • So it is FORCED coercion (aka blackmail) but coercion nonetheless.

            So again, what is he difference on the colluding point?

            If someone deals drugs on pain of death it is still a drug deal. The courts may decide to only prosecute the person doing the blackmailing but it does not mean that the charge of dealing drugs is not applicable.

            In this case the weight of law for colluding++ should come crashing down atop Apple's head and not a moment too soon. Anti-competitive practices should not be allowed in a free mar
    • The minimum price for books was set above the market price. The cartel set the minimum to 15 when books were selling at 10. The minimum price for apps in the USA is a dollar. You can't go much lower than a dollar before you hit hard limits from credit card fees and server costs.
    • Apple did not meet with a cartel of App publishers and coordinate prices. The App market does not contain huge players that control access to 90% best selling applications. To be clear I don't think Apple created the ebook cartel. It clearly existed for awhile. I think they got involved with it too closely and got a little dirty.
  • I don't have any.

    Litigation hurting them is a positive in my mind. However, they probably won't get fined enough money to really hurt them.

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