US Justice Department Confirms E-Book Probe

[fjtorres]

Originally Posted by rhadin

The U.S. Supreme Court has already approved agency pricing with regard to electronics, so it is doubtful anything will happen to upset the ebook agency pricing.

The Brusselcrats are looking into the *coordination* side of the deal. As "cartel-ing".

The feds might be working off the idea that *one* company doing it is okay but *five* coordinating to do the same thing at once doesn't pass the smell test for "coincidence". Random House had their own qualms, which is why they held back for a while.
It may yet turn out that they should've waited a few months more.

The thing to bear in mind is that it is the *antitrust* guys investigating in the US. And, as US history has shown, pretty much anything can be an antitrust violation, so long as the feds say it is.

Antitrust and RICO are very broad and ill-defined by design.
That's why always takes forever to convict under them.

[JSWolf]

delete post

[JSWolf]

It's the deal that Apple made that says that nobody is allowed to sell agency eBooks less then Apple does that's a big part of this.

[ScalyFreak]

Does anyone else remember the headlines from earlier this year about Sony not being allowed on iPhone and iPad? Rumor at the time was a disagreement on pricing...

[ilovejedd]

Originally Posted by ScalyFreak

Does anyone else remember the headlines from earlier this year about Sony not being allowed on iPhone and iPad? Rumor at the time was a disagreement on pricing...

It's not pricing per se. The problem is Apple changed the terms so that every app offering digital goods for sale needs to be able to accept payment via iTunes and Apple takes a 30% cut. There's also the restriction that the digital goods offered inside the iOS app has to be priced the same or lower than can be found elsewhere. That's why a lot of apps were updated to remove links to ebookstores, etc.

[ScalyFreak]

Originally Posted by ilovejedd

It's not pricing per se. The problem is Apple changed the terms so that every app offering digital goods for sale needs to be able to accept payment via iTunes and Apple takes a 30% cut. There's also the restriction that the digital goods offered inside the iOS app has to be priced the same or lower than can be found elsewhere. That's why a lot of apps were updated to remove links to ebookstores, etc.

So... disagreement on pricing?

You remembered the details better than I did. Since I don't have any iOS devices I wasn't really paying that much attention to the article other than a "oh, look, the titans at war again". I completely missed the part where Apple takes a 30% cut on everything sold through apps on their devices, and I can definitely see why that's a bigger deal to Sony than the other terms and restrictions. I imagine it would be a big deal to anyone.

[SteveEisenberg]

Originally Posted by rhadin

The U.S. Supreme Court has already approved agency pricing with regard to electronics, so it is doubtful anything will happen to upset the ebook agency pricing.

I suppose that Apple is unlikely to lose in its home market. But Europe has its own probe. If Apple loses on one continent, it may affect all.

Originally Posted by Fbone

If the DOJ and the Courts allow hundreds of other products to be agency priced, why would they make an exception for ebooks?

Here's a Wikipedia article on the general issue:

http://en.wikipedia.org/wiki/Resale_price_maintenance

From the link above, I gather that this sort of price fixing has only been legal in the US since 2007, and the situations in which it might be allowed are not fully settled law.

[ilovejedd]

Originally Posted by ScalyFreak

So... disagreement on pricing?

You remembered the details better than I did. Since I don't have any iOS devices I wasn't really paying that much attention to the article other than a "oh, look, the titans at war again". I completely missed the part where Apple takes a 30% cut on everything sold through apps on their devices, and I can definitely see why that's a bigger deal to Sony than the other terms and restrictions. I imagine it would be a big deal to anyone.

That's why I said "per se". By itself, I don't think pricing would be an issue but if Apple's also taking a 30% cut, then Sony (or most anyone aside from the publishers, really) won't be left with any profit.

[theducks]

Originally Posted by ilovejedd

That's why I said "per se". By itself, I don't think pricing would be an issue but if Apple's also taking a 30% cut, then Sony (or most anyone aside from the publishers, really) won't be left with any profit.

30% cut is about what a (cover price) retailer nets (after shipping charges) on paperbacks, so that does not account for why the price went UP.
Oh the non-discount clause means the price does not need to be competitive anymore.
Apple just enabled what the publishers wanted all along. Ability to really set price margins.
The DOJ is wasting time and $$

[tubemonkey]

The bottom line is that consumers love the agency model. If they truly objected to it, they'd boycott these publishers.

[Andrew H.]

Originally Posted by SteveEisenberg

I suppose that Apple is unlikely to lose in its home market. But Europe has its own probe. If Apple loses on one continent, it may affect all.

Sorry, no. Apple won its preliminary injunction against Samsung in Germany and lost it in California.

And of course most of the big publishers are European.

[/quote]

Here's a Wikipedia article on the general issue:

http://en.wikipedia.org/wiki/Resale_price_maintenance

From the link above, I gather that this sort of price fixing has only been legal in the US since 2007, and the situations in which it might be allowed are not fully settled law.[/QUOTE]

Agency pricing has nothing to do with resale price maintenance. And - as has been pointed out before - resale price maintenance of books is legally required in most of Europe. (Not just permitted).

So it's not at all clear what will happen with this, if anything.

[SteveEisenberg]

Originally Posted by tubemonkey

The bottom line is that consumers love the agency model. If they truly objected to it, they'd boycott these publishers.

Boycott, in the sense that they would never again let Penguin have another dime? No. But a partial boycott, in the sense of reduced sales, may already be starting. There's another current thread here in which someone said they spent less money on books, in 2011, due to unwillingness to pay high eBook prices. I took this to mean higher than the pre-agency US$9.99 standard Amazon price. You yourself mentioned a total price spent on eBooks during 2011 that sounded rather close to a boycott to me.

Realistically, publishers are in for a big revenue decrease due to the analog to digital transition, just as occurred earlier to record companies. There will be winners and losers, but most authors and publishers will be losers. High prices and price-fixing may or may not make business sense in this environment, but we are seeing both of those, and there will be people who don't buy the books as a result.

[Phogg]

Originally Posted by tubemonkey

The bottom line is that consumers love the agency model. If they truly objected to it, they'd boycott these publishers.

So you are saying that the average consumer pays attention to what is going on in the business world and knows what is going on beyond what something is named and what color it is now.

WOW! That is a radical change from the sixties when I was born. Also from the seventies, eighties, nineties, and the two thousands.

When did this radical change take place?

[Elfwreck]

I am amused:

Hachette's "decision to distribute e-books through agency distribution not only better serves our authors and customers, it has also helped to increase competition and consumer choice in e-books and devices," a spokeswoman for Hachette Book Group said.

I would love to hear how agency pricing "better serves customers" and "increases consumer choice."

[tubemonkey]

Originally Posted by Phogg

So you are saying that the average consumer pays attention to what is going on in the business world and knows what is going on beyond what something is named and what color it is now.

No; I'm saying they just don't care. They like the book, so they'll pay the price. They might grumble if the price is higher than normal; but in the end, they'll pay it anyway.