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Old 06-26-2012, 10:41 AM   #18
stonetools
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First of all, federal judges are pretty good at resisting public pressure, so I wouldn't worry over much about public pressure forcing the judge to reject the settlement. At the end of the the first linked article, there is this LINK

Quote:
Given the details of the settlement and what has already occurred in the case, Judge Denise Cote is likely to approve the e-book price-fixing settlement between the Department of Justice and three of the largest U.S. publishers, according to an antitrust lawyer familiar with the case.
Nonetheless, it isn't surprising that just about every one in the book industry not named Amazon opposes this settlement. If you are a supplier to Amazon or a competitor to Amazon this settlement is for you just a bag of hurt.
IF you are a supplier, then once Amazon regains say, an 80 per cent domninance in the market, it can tell you" Sell your books us us at our price, or face financial ruin".
If you are a competitor, your choice is to match Amazon on price discountsand suffer heavy losses or not to match and lose market share. Those aren't great choices.

JUdge Cote will most likely approve the settlement, but with tweaks. Problems with the settlement include these:

Quote:
What is different in this case is the prohibition that the publishers enter into an agency agreement with another bookseller, according to Cooper.

“’We’re going to make you get out of the contracts that were a key part of this alleged conspiracy,’” said Cooper, speculating on the Justice Department’s thinking. “And then we’re going to go further and say ‘you can’t have those kinds of contracts with any other retailer.’”

What’s unusual about this is that in most settlements, the Justice Department will regulate the relationships between the parties involved in the case but no others, said Cooper. This nuance could have a significant effect on the industry.

“There’s a lot of detail in the proposed settlement is that greatly restrains if not completely eviscerates the ability of these publishers to control retailer pricing,” said Cooper.

One other point in the settlement that has been discussed widely in publishing circles is the discounting clause that stipulates that Amazon and other book retailers can now control the price of the settling publishers’ books but have to break even or make a profit on the business they do with each publisher. So, Barnes & Noble, for instance, would be allowed to discount Walter Isaacson’s Steve Jobs e-book at will, taking a loss on each copy sold, but would have to make up that loss by profiting on the rest of Simon & Schuster’s catalog that it sells.

Publishing industry observers have raised many questions around this: When does the fiscal year start and stop for each of the parties? How will this practice be monitored? How are overall profits and losses on e-books going to be accounted for in terms of a large, overall digital business that sells devices and services along with digital downloads? Will there be penalties if a retailer is unable to make a profit at the end of the year after selling books at a loss throughout the year?

According to Cooper, this detail in the settlement was likely negotiated by the lawyers for the settling parties as a way to prevent predatory pricing on the part of some e-book retailers.
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