[PCWorld]

Post your comments for Despite Denial, Apple Dictated E-Book Pricing at iBookstore here

[Internet2k4]

Apple didn't "compete" - it took an agency commission of 30% on the publishers' conspiratorial price. That was the new game. Amazon retailed the books at $9.99, and had liberty to compete as a retailer. Apple turned the publishers into de facto monopoly retailers of every copyrighted work and the publishers fixed their ebook prices on the basis of a fixed commission to Apple. That's the problem and case, and we'll see if it was legal. I think not.

[gludwick]

Sweet deal - both the pubishers AND Apple maximize their profits, prevent price competition from Amazon and - to paraphrase Steve Jobs - if the customer gets screwed, who cares...we all get what WE want, right guys?

[TaylorNelson]

if you are the retailer, what's wrong with "dictating" price for your own store? This is farce.

[TaylorNelson]

Nobody HAS to publish through the Apple store, so I don't see how the rule applies. In fact, there are open source book formats, you could theoretically sell them yourself. I can see how Apple has a lot of market power, but this will not remain the case forever.

[TaylorNelson]

gludwick, on 13 April 2012 - 07:45 AM, said:

Sweet deal - both the pubishers AND Apple maximize their profits, prevent price competition from Amazon and - to paraphrase Steve Jobs - if the customer gets screwed, who cares...we all get what WE want, right guys?

C'mon, you know that if the price goes too high, people will buy less. We need more facts before we can really say how much monopolistic power was being wielded here. Apple is protecting its space, like any other company would do. Maximizing profits is what ensures that we will HAVE ebooks. It's not their fault for having the first, steady supply. The government is cracking down too hard.

Honestly, do you feel that Apple is terrorizing you with their book prices? We need some economists and hard facts in here stat! The dead weight loss to consumers can't be that high.

[UniWold]

Okay for all those saying Apple is the victim. This article doesn't explain it clearly. The problem with the "Most Favored Nation" clause is not that it lowers the prices, quite to the contrary, it increases prices. Because Publishers wanted to sell books at higher prices, they were forcing Amazon to increase the prices, not actually matching the 9.99 prices of Amazon in the Apple book store.

[kennyrosenyc]

This is stupid. Amazon sells real books as well. Which means that buying bulk copies of, say, the Steve Jobs book got them a discount which offsets the low price of the eBook. I say this because I personally know buyers at Barnes and Noble and they do the same thing. Amazon never took a loss on eBooks. And having sales and discounts has been a part of retail ever since I can remember. It's the heart and soul of being a smart shopper. Apple basically demanded a discount without buying real books at all so instead the publishers raised the price of eBooks. That having been said eBooks should cost less than physical books as there's no production cost at all. But I could care less if the DOJ gets Apple so long as the prices drop.

[Howards5iu]

Look, TaylorNelson, Apple has every right to do whatever it wants in it's own store... but what don't you understand is how it affected OTHER STORES LIKE AMAZON. That is the whole point to the lawsuit that you're missing. Apple and publishers got into an agreement no how to force prices higher. Apple set the rules, and publishers could just point to Apple and say, "It's not our fault", all the while reaping higher profits from their sales on Amazon.

Do you like capitalism? Do you like a Free Market? When this crap happens, it destroys both. It's price controlling and it's illegal.

[ThomasMcGuire]

TaylorNelson, on 13 April 2012 - 07:53 AM, said:

if you are the retailer, what's wrong with "dictating" price for your own store? This is farce.

... because you can't. The ability to compete on price between retailers was essentially eliminated.

[Taruk]

This is total BS. MFN clause insures that consumer was always getting the lowest price. Apple has to be commended on that. I know the real story. Obama was trying to squeeze Apple for donation and was sent packing. So Obama ordered DOJ to get even.

[nonseq]

Taruk, on 13 April 2012 - 08:45 AM, said:

This is total BS. MFN clause insures that consumer was always getting the lowest price. Apple has to be commended on that. I know the real story. Obama was trying to squeeze Apple for donation and was sent packing. So Obama ordered DOJ to get even.

I don't know about Obama getting even- either way but it's a pretty inflammatory charge to make. Do you have substantiation? Thanks

[JayPre]

Blah blah blah... The only reasons Amazon owned this market is because there was no one else to compete with. Apple dictates its terms, and people listen, because they're right. They're trying to save these Publishers while Amazon was taking advantage of them. When will people realize that Technology is a major driver, and that some old "Most Favorable Nation" Clause is what needs to be updated? Shame on you for being a technology writer..

[JayPre]

Blah blah blah... The only reasons Amazon owned this market is because there was no one else to compete with. Apple dictates its terms, and people listen, because they're right. They're trying to save these Publishers while Amazon was taking advantage of them. When will people realize that Technology is a major driver, and that some old "Most Favorable Nation" Clause is what needs to be updated? Shame on you for being a technology writer..

[JayPre]

Blah blah blah... The only reasons Amazon owned this market is because there was no one else to compete with. Apple dictates its terms, and people listen, because they're right. They're trying to save these Publishers while Amazon was taking advantage of them. When will people realize that Technology is a major driver, and that some old "Most Favorable Nation" Clause is what needs to be updated? Shame on you for being a technology writer..

[QUADICON]

Of course they aren't going to admit to price fixing. All Apple does is price gouge.

Apple was like, (alledgedly) we could get $3.00 for every book that gets sold for $10.00, but wny stop there? Since we have the most popular platform lets sell the books for 20.00 and 30.00 that way we get to millions much quicker.

The only expense in the book is getting it written. Digital copies will sell faster than a paperback these days. So if you sell them at 10.00 Apple, won't you sell enough to make a load of money? Your greed is sickening to say the least.

It's only costs you time and labor to make onesingle didgital copy, which Apple doesn't even have to do. Each copy thereafter is basically a copy of the orginal files. You coudl make millions of copies in just minutes and the labor is small. One person at a computer could create millions of copies in a manner of hours.

They shouldn't even cost more than $5.00 in my opinion.

Since apple knows they ahve the most popular mobile platform right now, they are taking advantage of consumers who are cluelessly stupid when ti comes to buying. I woudl expect a first run book made of paper would cost more because of time and materials required. But a digital copy? That has very little to no pictures? Where no ink or typeset was used? Where a small amount of labor is needed?

Apple would never admit to any wrong doing...why should they. Microosft surely didn't. So why expect any different. That is what courts are for. Prove them guilty, fine their arse, and you should force Apple to refund 100% of the cost on every book they ever sold.

if you just slap them on the wrist, they will simply keep doing it. It is time to make them pay for greed.

[QUADICON]

Taruk, on 13 April 2012 - 08:45 AM, said:

This is total BS. MFN clause insures that consumer was always getting the lowest price. Apple has to be commended on that. I know the real story. Obama was trying to squeeze Apple for donation and was sent packing. So Obama ordered DOJ to get even.

What does the President have to do with price fixing? Oh wait...did you scream bloody mary when Bush took all your money to have it lost by Wall Street? What about the banks that still find ways to take your money for doing NOTHING? You blaming the President...really?!

Better to be quiet and be thought of a fool than to open your mouth and remove all doubt -Abraham Lincoln

[QUADICON]

JayPre, on 13 April 2012 - 10:03 AM, said:

Blah blah blah... The only reasons Amazon owned this market is because there was no one else to compete with. Apple dictates its terms, and people listen, because they're right. They're trying to save these Publishers while Amazon was taking advantage of them. When will people realize that Technology is a major driver, and that some old "Most Favorable Nation" Clause is what needs to be updated? Shame on you for being a technology writer..

You are wrong.

Quote

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.

If you go to a retailer JayPre and they sell 10 different types of laundry soap, does that retailer force the seller to make their price match the lowest one? Even if their product coudl be better? NO THEY DON'T. You need to learn to read. Apple claims they allow selles to sell their book for whatever, yet the facts show they force the sellers to match the lowest cost PERIOD. That si price fixing and thet si illegal. Learn to read with common sense and not fanatic eyes.

Here is a BETTER example for you. We all know we can get computers that are less than Apple's by a marhin of average 20% - 40%. Suppose BesT Buy told all the OEM's including Apple; "Acer has the lowest prices. If your hardware is identical to their PC, you must sell yours at the same low cost for us to carry it"...you think the OEM's woudl like that? You think Apple would want to sell their over-priced computers for a more reasonable cost? NO THEY WOULD'NT.

Look in the app store, devs set the cost of whatever they want to sell their app for. If Rovio wants to sell Angry Birds for .99 cents and I make an app similar called Angry Ants and I want to sell mine for 1.99...I can do so. I don't have to match that lowest cost even if the game is nearly identical.

Being greedy will get you caught and likely someone inside got tired of the game and hinted to the DOJ what Apple was doing. You ever thought that maybe a publisher felt their book was better than someone elses and didn't want to be force to sell it at a lower cost, knowing he could get more?

[JakeWaxelbaum]

Here are the facts of what happened (numbers are rounded):

Amazon in 2009 - Selling ebooks at $10 because they determined this price themselves

Publishers in 2009 - We aren't making enough money because of lower cost ebooks on Amazon

Apple in 2009 - Approaches publishers with an idea, prior to the release of the iPad. Come sell your books in our ebook store because you know you will reach $the millions you want faster, after all everyone is obsessed with Apple.

Apple and Publishers in 2009 - Documents which the DOJ will provide show Apple would allow the sale of ebooks but only if it gets a 30% cut of every book sold.

Example: For a $10 book Apple gets $3 and publisher gets $7. Publisher just lost $3 to Apple for the priveledge of selling in their ebook store. So what do the publishers do? That's right they raise the price of books to $13 or higher so they can make their minimum $10 cut per book.

But guess what Apple continued it's anticompetitive ways and said Apple exclusively gets the lowest prices on ebooks than any other store and publishers determine the prices for the stores now.

Example: Apple sells the book for $13, Amazon is now forced by the publisher to sell the exact same book for $15. Where are you going to buy from? The lower priced book store of course.

So Apple along with the publishers fixed the prices of ebooks so none of their competitors could compete and could just continue Apple's greed. Price fixing, which this is a blatant case of is ILLEGAL, and yet the publishers did it anyway, with Apple as the ring leader. This is why they are in trouble because rather than compete Apple chose to break the law instead. I sincerely hope their company gets severely damaged from this and we no longer have to deal with their Anti-Competition business practices.

[roberthoffman]

1) The cheaper e-books are the more people will buy.
2) E-books should be cheaper because they have no resale value and they cannot easily be lent to friends.
3) Retailer should be able to sell merchandise at any markup they want. This is a problem with Apple computers. Vendors cannot discount them.
4) If e-book sales are hurting local bookstores, they are a victim of technology, not the price Amazon or Apple sells them for.
5) Maybe local bookstores should have the options to have customers browse the bookstore and than download the book at the front desk.