Apple gripes about antitrust monitoring

[Greg Anos]

I simply have to ask the following questions.

1. Was an effort made to raise prices for e-books?

2. Was a concerted effort among parties involved to raise those prices?

If both of those are yes, we have an anti-trust situation. 1. was yes, I watched it happen. 2. is a question of evidence. One cannot claim natural market forces, such as a shortage of labor or materials, to have caused the need to raise e-book prices. E-books are infinitely reproducible, at trivial cost. Was there collusion? If there was collusion, then all parties to the collusion are equally culpable, even those starting with zero market share.

Note, none of these questions have any name attached to them...

[pwalker8]

They are still trying to find the natural price points of ebooks. While it is true that ebooks are infinitely reproducible at trivial cost, the initial product, the book itself, is basically a one of a kind creation. Most people don't buy generic ebooks, they buy a specific book. So the question becomes what is the public willing to pay for that specific book? If you set it too high, then people decide it's not worth it and buy other ebooks by other authors/publishers. If you set it too low, then you don't make money and that publisher/author doesn't produce anymore books.

A concerted effort among parties involved to raise those prices doesn't imply an anti-trust situation. It's only anti-trust if the parties agree to a specific price point, or agree not to under sale each other. In addition those parties have to have a monopoly position. For example, it would not be an anti-trust situation if you and I got together and decided to only sale our self published ebooks for $10. If would be anti-trust if the major publishers did the same.

My understanding of the situation is that the publishers didn't get together as set a price, but rather they got together and forced Amazon to accept an agent pricing agreement, where the publishers set the price, not Amazon. Whether or not that is an anti-trust situation isn't really known.

[tubemonkey]

Originally Posted by pwalker8

They are still trying to find the natural price points of ebooks. While it is true that ebooks are infinitely reproducible at trivial cost, the initial product, the book itself, is basically a one of a kind creation. Most people don't buy generic ebooks, they buy a specific book. So the question becomes what is the public willing to pay for that specific book? If you set it too high, then people decide it's not worth it and buy other ebooks by other authors/publishers. If you set it too low, then you don't make money and that publisher/author doesn't produce anymore books.

It's not difficult to set a price. During initial hardback only release, charge the same price minus the physical costs associated with printing, warehousing, transportation, etc. Then when the various paperbacks are released, do the same thing there.

[Graham]

Originally Posted by pwalker8

It's only anti-trust if the parties agree to a specific price point, or agree not to under sale each other.

Agreeing not to under sell each other is exactly what they did. It's the only way you can possibly read the MFN clause with Apple.

Originally Posted by pwalker8

In addition those parties have to have a monopoly position.

Where is this stipulated?

Originally Posted by pwalker8

For example, it would not be an anti-trust situation if you and I got together and decided to only sale our self published ebooks for $10. If would be anti-trust if the major publishers did the same.

We are talking about the major publishers here, of course.

Originally Posted by pwalker8

My understanding of the situation is that the publishers didn't get together as set a price,

They got together and set an effective minimum price, with a combination of raising the new sale price for bestsellers and Apple's MFN clause.

Originally Posted by pwalker8

but rather they got together and forced Amazon to accept an agent pricing agreement, where the publishers set the price, not Amazon. Whether or not that is an anti-trust situation isn't really known.

The DOJ and the judge certainly thought it was an anti-trust situation. By all means claim that it isn't really known until the appeal is heard.

Graham

[Sil_liS]

Originally Posted by pwalker8

Things like Cote writing most of her opinion before the trail, saying before the trial that she thought that Apple was guilty, and Judge Cote's history of prejudicial (in the sense of favoring one party over another in trials) behavior.

The Judge didn't write most of her opinion before the trial, and she didn't say before the trial that she thought that Apple was guilty. She said after she was presented with the evidence that there was evidence. And can you give a link for the judge's history of prejudicial (in the sense of favoring one party over another in trials) behavior?

[jgaiser]

Originally Posted by Sil_liS

The Judge didn't write most of her opinion before the trial, and she didn't say before the trial that she thought that Apple was guilty. She said after she was presented with the evidence that there was evidence. And can you give a link for the judge's history of prejudicial (in the sense of favoring one party over another in trials) behavior?

You've got to realize that pwalker8 is a fanboy. Apple can do no wrong and if they're caught doing something wrong, it must be the other guy.

All of this stuff has been pointed out to him/her again and again and she/he continues to ignore the facts and persists in the dream that it will all be overturned on appeal.

[SteveEisenberg]

Originally Posted by Sil_liS

. . . she didn't say before the trial that she thought that Apple was guilty.

See:

In late May, about two weeks before trial, Cote said the following:

"I believe that the government will be able to show at trial direct evidence that Apple knowingly participated in and facilitated a conspiracy to raise prices of e-books, and that the circumstantial evidence in this case, including the terms of the agreements, will confirm that."

So she did think that Apple was guilty, and thought the trial would confirm her preconception. Not surprisingly, it did.

My personal view of the litigation is that to have the government give a publisher a legal monopoly, which is precisely what copyright is, and then go after them for being a monopolist, is absurd.

[Prestidigitweeze]

Originally Posted by jgaiser

You've got to realize that pwalker8 is a fanboy. Apple can do no wrong and if they're caught doing something wrong, it must be the other guy.

Or else one could realize that pwalker8 is currently arguing for a particular position and leaving it at that, as opposed to attacking the personalities and unstated motives of people who present opposing positions, as (I regret to say) you've done here.

Personally, I'm interested in the summaries and counterarguments that pwalker8's posts have invited. If this were merely another fanboy/anti-fanboy discussion, and had devolved into parties trading snarky sobriquets and personal attacks, then this thread wouldn't be as interesting as it has been (at least for me).

[DiapDealer]

Originally Posted by SteveEisenberg

My personal view of the litigation is that to have the government give a publisher a legal monopoly, which is precisely what copyright is, and then go after them for being a monopolist, is absurd.

The government didn't "go after" a publisher. They went after a group of them (competitors) who acted in concert with another corporation to raise prices. It's not that difficult a distinction to grasp. I fail to see why so many struggle to do so. The conspiracy (with Apple at the center assuring individual players that the rest of the players would be on board when the trigger actually got pulled) is the beginning, middle and end of the issue.

Besides... how is copyright a monopoly granted to the publisher? The publisher isn't the rights holder. They've simply negotiated a contract with the rights holder.

[Barcey]

Originally Posted by SteveEisenberg

See:



So she did think that Apple was guilty, and thought the trial would confirm her preconception. Not surprisingly, it did.

My personal view of the litigation is that to have the government give a publisher a legal monopoly, which is precisely what copyright is, and then go after them for being a monopolist, is absurd.

The trial was just a part of the full legal procedure. Fact and expert discovery had concluded in March. Both parties requested a finding of facts and conclusion of law from Judge Cote prior to going to trial and that is where those statements came from. It isn't evidence of bias, it was opinion based on the evidence provided to her up to that point in time. I've seen this pointed out to pwalker numerous times but it hasn't stopped the disinformation from being repeated.

The full ruling is here, I would recommend people read it if they're really interested in the facts of the case.http://www.scribd.com/doc/152920247/...in-DOJ-v-Apple

PROCEDURAL HISTORY
Fact and expert discovery in these actions concluded on March 22, 2013. The parties’ Joint Pretrial Order, proposed findings of fact and conclusions of law, and pretrial memoranda were submitted on April 26 and, following rulings on redactions,were filed on May 14.

[SteveEisenberg]

Originally Posted by DiapDealer

I fail to see why so many struggle to do so.

If I bought a lot of books directly (as opposed to indirectly through my tax dollars), it might be less of a struggle

But as I see it, the whole idea of copyright it to make the book expensive so that creators (not just the author, but the whole team who created the book) get incentivized to do the best job possible. The guilty publishers were just doing, in the US, what they are legally required to do in other countries, and I don't see why our way is better for society.

Besides... how is copyright a monopoly granted to the publisher? The publisher isn't the rights holder. They've simply negotiated a contract with the rights holder.

It all depends. In the case of most of the books I read, the copyright notice says it is copyrighted by the author, but the contract you mentioned basically transfers the rights to the publisher for many years. As for the book I am currently reading, the notice reads: "Copyright © 2000 by the President and Fellows of Harvard College." Since the Kindle edition is $52.80 (with no big-six involvement), I'm reading a paper copy from the Philadelphia library. I hope and presume the price is set where it is to maximize revenue to the author and publisher.

[bgalbrecht]

Originally Posted by pwalker8

My understanding of the situation is that the publishers didn't get together as set a price, but rather they got together and forced Amazon to accept an agent pricing agreement, where the publishers set the price, not Amazon. Whether or not that is an anti-trust situation isn't really known.

My understanding of the situation is that
A) The publishers thought they could raise ebook prices (by preventing epub discounting) so there would be less pricing pressure on their big profit maker, the hardcover book, if they could switch to ebook agent pricing agreements.
B) None of the publishers thought they alone could get Amazon to accept an agent pricing agreement, but if they all insisted on switching, Amazon would go along with it.
C) Apple didn't want to get into the ebook business if they thought Amazon could undercut them, but they really wanted to get into the ebook business so they were in favor of the agent pricing agreements.
D) Apple was involved in discussions with the publishers which allowed the publishers to know which other publishers were going to force Amazon to switch.
E) Even though they all professed innocence, the publishers all settled rather than go to court.
F) When Apple lost in court, the judge wrote a detailed decision in such a way that it is unlikely that Apple will get the decision reversed.

You can claim it's unknown all you want, but I expect when all the appeals are over and done with, Apple will not prevail.

Originally Posted by SteveEisenberg

So she did think that Apple was guilty, and thought the trial would confirm her preconception. Not surprisingly, it did.

My personal view of the litigation is that to have the government give a publisher a legal monopoly, which is precisely what copyright is, and then go after them for being a monopolist, is absurd.

The difference between this and a trial before an impartial jury is that when Cote made that statement, she had already overseen the settlements between the DOJ and the publishers and seen most of the discovery evidence. What she hadn't seen is the Apple testimonies within the trial. One of the DOJ lawyers asked if she would be able to share any of her thoughts on the case so far during the pretrial hearings and she gave them.

Originally Posted by Reuters

Cote then gave what she called her "tentative view," which she said was based largely on material submitted as evidence - emails and correspondence that took place over a six-week period between December 2009 and January 2010.

And Steve, the government wasn't going after the publishers for being monopolists, they were going after them for colluding in an attempt to raise prices.

For what it's worth, with all the discounting going on at the non-Amazon retailer I mostly bought from, the price I paid for ebooks before April 1 2010 was about 1/3rd the price I would have paid for the same books a year later. And since the settlements, I've been able to find deals like I was getting before agency pricing went into effect (and at least half of them not at Amazon).

Originally Posted by SteveEisenberg

But as I see it, the whole idea of copyright it to make the book expensive so that creators (not just the author, but the whole team who created the book) get incentivized to do the best job possible. The guilty publishers were just doing, in the US, what they are legally required to do in other countries, and I don't see why our way is better for society.

The purpose of copyright is to ensure that the author gets paid, the publisher creates a contract with exclusive rights from the copyright holder to ensure that their costs involved in creating the book are recouped. Book publishing is a somewhat elastic market, and making a book more expensive is not necessarily adequate or the right thing to do to recoup those costs. The book price fixing in France, for example, is for the protection of small (local) bookstores, not for the publisher.

[Sil_liS]

Originally Posted by SteveEisenberg

See:

So she did think that Apple was guilty, and thought the trial would confirm her preconception. Not surprisingly, it did.

Stating that the government will be able to show direct evidence confirmed by circumstantial evidence does not mean that that the party in question was found guilty.

The statement was made after the Judge was presented with the evidence by both sides, but before the testimonies and arguments.

If a judge has seen a suicide note then the judge can say that evidence can be shown that it was a suicide but it doesn't mean that the ruling already happened.

[Greg Anos]

Originally Posted by SteveEisenberg

If I bought a lot of books directly (as opposed to indirectly through my tax dollars), it might be less of a struggle

But as I see it, the whole idea of copyright it to make the book expensive so that creators (not just the author, but the whole team who created the book) get incentivized to do the best job possible. The guilty publishers were just doing, in the US, what they are legally required to do in other countries, and I don't see why our way is better for society.

It all depends. In the case of most of the books I read, the copyright notice says it is copyrighted by the author, but the contract you mentioned basically transfers the rights to the publisher for many years. As for the book I am currently reading, the notice reads: "Copyright © 2000 by the President and Fellows of Harvard College." Since the Kindle edition is $52.80 (with no big-six involvement), I'm reading a paper copy from the Philadelphia library. I hope and presume the price is set where it is to maximize revenue to the author and publisher.

To answer you question. Each copyright is an individual monopoly. It is expected to compete with every other monopoly.

Let me give you a historical example concerning real property. I own land. I make a lease to an oil and gas company to develop the oil under my property. The company does so and sell the oil. So far, so good. They have a monopoly on developing oil under my property. But that does not grant them the right to form a monopoly of all oil production. (Standard Oil, 1911 SOTUS ruling, the first anti-trust action approved by the US Supreme Court.) Substitute copyright for oil, and you have an exact mirror situation...

[pwalker8]

Originally Posted by jgaiser

You've got to realize that pwalker8 is a fanboy. Apple can do no wrong and if they're caught doing something wrong, it must be the other guy.

All of this stuff has been pointed out to him/her again and again and she/he continues to ignore the facts and persists in the dream that it will all be overturned on appeal.

Gosh amazing how many things some assume on the internet that aren't true. pwalker buys the vast majority of his ebooks from Amazon, baen books and Sony (in order of number of books). I got a couple of freebee books from Apple just to test out the de-drm program. Other than that, I don't use the Apple ebook store and really have no plans to.

But hey, if you just assume that anyone who doesn't bash Apple at every opportunity must be an Apple fanboy, then you don't really have to look very closely at the actual issues.