2 of 3 Judges appear to favor Apple in ebook appeal

[eschwartz]

Originally Posted by pwalker8

Fictionwise was bought out by B&N in 2009.

What's the therefore?

[murg]

Originally Posted by pwalker8

Fictionwise was bought out by B&N in 2009.

Excellent point.

B&N had high hopes for fictionwise, which is why they bought it (before the whole Apple breaking the law thing).

Then, after a few years of not being able to compete against the illegal collusion, fictionwise was put out of its misery.

[pwalker8]

Originally Posted by eschwartz

What's the therefore?

Therefore Apple could not have put them out of business. Companies that buy competitors don't normally keep them in business for long.

[pwalker8]

Originally Posted by DuckieTigger

Back To The Future Flux Capacitor Fallacy.

I like your name better.

[Shades]

Originally Posted by pwalker8

Therefore Apple could not have put them out of business. Companies that buy competitors don't normally keep them in business for long.

No. Either they assimilate them, like Microsoft did with Skype and Nokia or they cannibalize them, by taking what they want (like Google taking Motorola's patents) and either selling the brand name or just letting the brand die.

B&N kept Fictionwise for 3 years. That means they wanted the Fictionwise brand to earn them money. They didn't cannibalize it nor did they buy it to get rid of competition. If they just didn't want FW around, they wouldn't have waited years to close them.

Ultimately, the reason FW was shuttered is because it wasn't making money. That's what companies do with divisions that don't earn money.

Now, what stopped FW from making money with their business model? Ah yes, Agency, which threw a wrench into almost all eBook sales models via price fixing.

[FizzyWater]

Originally Posted by Shades

No. Either they assimilate them, like Microsoft did with Skype and Nokia or they cannibalize them, by taking what they want (like Google taking Motorola's patents) and either selling the brand name or just letting the brand die.

B&N kept Fictionwise for 3 years. That means they wanted the Fictionwise brand to earn them money. They didn't cannibalize it nor did they buy it to get rid of competition. If they just didn't want FW around, they wouldn't have waited years to close them.

Ultimately, the reason FW was shuttered is because it wasn't making money. That's what companies do with divisions that don't earn money.

Now, what stopped FW from making money with their business model? Ah yes, Agency, which threw a wrench into almost all eBook sales models via price fixing.

Fictionwise owned the DRM method that B&N used to wrap around its ePubs. Personally, I think that's why they bought them.

[Shades]

Originally Posted by FizzyWater

Fictionwise owned the DRM method that B&N used to wrap around its ePubs. Personally, I think that's why they bought them.

True, but why keep them around for years after the sale? They more than likely had other intentions for the brand.

It's just too much of a coincidence in my opinion that three eBook stores closed after Agency went into effect.

[rhadin]

Originally Posted by Shades

True, but why keep them around for years after the sale? They more than likely had other intentions for the brand.

It's just too much of a coincidence in my opinion that three eBook stores closed after Agency went into effect.

Having worked on several deals like the B&N-Fictionwise deal, it is quite likely and possible that the sellers of Fictionwise insisted as part of the sale "price" that the store be kept open for a certain time period. This is not unusual when small businesses sell to larger businesses as the small business owners think that if their company can be kept profitable, their "child" will continue to live and thrive.

Regardless, I find it interesting how easily people impose their preferred theories as "facts" to situations about which they have no information.

It is worth noting, as long as we are imposing our own beliefs, that many of the people who bought at Fictionwise were not B&N customers. It is as likely that B&N kept Fictionwise going in hopes of moving Fictionwise customers to become B&N customers.

In the end, B&N was selling the same books as Fictionwise and likely saw Fictionwise as an unneeded sales path.

[pwalker8]

Originally Posted by Shades

True, but why keep them around for years after the sale? They more than likely had other intentions for the brand.

It's just too much of a coincidence in my opinion that three eBook stores closed after Agency went into effect.

Any time you have a lot of a new market, it's not unusual to have a high number of companies in that market go belly up. Making money in an ebook store that isn't directly tied to a device is hard. Buying ebooks from 3rd party stores requires customers who are comfortable getting the ebook from that store to the device. Most kindle owners buy from the Amazon store. Most nook owners buy from the B&N ebook store.

Sony had their ebook store open before Amazon and had, arguably, a superior ebook device to the original kindle, yet they went out of business, mostly because customers had to jump through hoops to get books on their Sony ebook readers. Calibre started out life as a method of getting ebooks on Sony ebook devices. (kind of funny that people don't also point to the Sony ebook store which went belly up this year, but had been struggling for a long time. )

Apple's market share has been estimated at from 10% to 20% making them either the 3rd ranked ebook store or 2nd ranked, behind Amazon (60%) and B&N (25%). It's a pretty far stretch to claim that the 3rd ranked store drove all these stores out of business when they were not the ones who were selling ebooks at below cost. Yes, I know that several of those companies are suing Apple, but that is more along the lines of "You have money, we want money, you pay us money to go away" lawsuits than any proof of cause/effect.

[JSWolf]

Originally Posted by pwalker8

You are saying that Apple drove a number of ebook stores out of business? Really? That's a pretty wild assertion. B&N purchased fictionwise in 2009 and the web store was closed by B&N in 2012. Booksonboard went out of business in 2013. Diesel eBooks went out of business in 2014. The Apple ebook store and agency pricing didn't go into effect until 2010. Judge Cote ruled on the case in July of 2013. The timeline just doesn't seem to match your narrative. How could Apple cause fictionwise to go out of business months before Apple started talking to the publishers, much less open an ebook store?

But Fictionwise ran on it's unique business model up until Agency took effect. After that, Fictionwise had to stop what it was doing and be like any other eBookstore. There then wasn't much special about Fictionwise. The fact that B&N bought Fictionwise doesn't matter. Fictionwise was run as it had always been run up until agency made that impossible.

BooksOnBoard's sales and credit back for buying eBooks didn't work under agency. Agency took all of that away. Diesel had discounts for eBook bundles which customers were able to suggest some of them. That was unable to continue due to agency.

So yes, Agency did take away what make the little guys stand out. They tried to stay in business doing it the agency way and they were unable to complete.

Agency pricing started in April 2010. The fact hat these little stores where able to last for a few years is not the issue. The issue is that they closed because agency made their original business model unsustainable and thus made then like everyone else. What made then unique and drve business their way no longer was possible. Apple and the price fix 5 drive them out of business. Inseatd of making more competition, The price fix 5+1 lessened competition by driving stores out of business.

[DuckieTigger]

Originally Posted by pwalker8

Apple's market share has been estimated at from 10% to 20% making them either the 3rd ranked ebook store or 2nd ranked, behind Amazon (60%) and B&N (25%). It's a pretty far stretch to claim that the 3rd ranked store drove all these stores out of business when they were not the ones who were selling ebooks at below cost. Yes, I know that several of those companies are suing Apple, but that is more along the lines of "You have money, we want money, you pay us money to go away" lawsuits than any proof of cause/effect.

What does market stare have to do with it? When the "only" 3rd biggest ebook store is directly at fault for effectively removing any loss-leaders in other stores that you blame for the going under of the little fish. I find it kind of funny for Apple to use the excuse : hey there is other stores that have loss-leaders, why don't you look at them, because you ain't never going to see anything without a big profit, let alone at cost or at loss, in our store.

[JSWolf]

Originally Posted by pwalker8

Any time you have a lot of a new market, it's not unusual to have a high number of companies in that market go belly up. Making money in an ebook store that isn't directly tied to a device is hard. Buying ebooks from 3rd party stores requires customers who are comfortable getting the ebook from that store to the device. Most kindle owners buy from the Amazon store. Most nook owners buy from the B&N ebook store.

These third party stores were doing business in a way that before agency worked well. After agency, didn't work at all and they had to be like everyone else. They had nothing unique going for them. Same eBooks, same price, no sales, no discounts, no loyalty programs, nothing. So yes, it did become hard to complete against the larger stores like B&N and Amazon. Amazon actually made out because of Agency. It backfired big time. Instead of leveling the playing field, they just ended up making shops like Amazon & B&N more popular then they would have been.

The little guys who didn't have a Reader tied to their store did indeed suffer. But they were doing much better before agency because they knew what worked for them and agency took all of that away.

You are wrong when you say/think that agency did not cause these shops to close. It most certainly did. Before agency, there were lost of messages hon MR about Fictionwise and BooksOnBoard. They competed with Amazon and did it well. Agency made that impossible and try as they might, they ended up not being able to stay in business. To compete with Amazon, you need to do something different. Agency took away that something different.

[Barcey]

Fictionwise had unique features that made them an attractive store to shop at. They presented some innovations to competing that were different from B&N's site. In general the books were more expensive but as part of that purchase they allowed you to bank money and buy additional books. They also allowed you to set price alerts for specific books so that you would be notified when it hit your price point. This allowed them to see what price point people were likely to buy at. The fact is that those innovations were directly killed off by agency and Fictionwise became yet another ebook site that most people hadn't heard of. There was no reason for B&N to keep it operational because it could offer nothing different from their primary site. I suspect they kept it running for a couple years because it still supported some old ebook formats and then killed it in 2012. Judging from what I read/observed on MobileRead, I'm sure that if B&N released the sales data you'd see a steep drop in sales when agency was implemented. People spent the money they had banked and moved to other sites.

[Purple Lady]

I bought a lot of books at Fictionwise until Agency pricing started. When Agency started Fictionwise no longer carried the big 5 books at all. IIRC their contract with the big 5 was canceled and they were no longer selling from big publishers except for Random House. I bought a lot of Random House books at that time specifically because they didn't participate in the price fixing. A bookstore that doesn't sell from the big publishers can't last long and they closed.

[DiapDealer]

Originally Posted by rhadin

Regardless, I find it interesting how easily people impose their preferred theories as "facts" to situations about which they have no information.

Me too. I especially like the people who pretend the information to support THEIR preferred theories is somehow MORE real. And then pretend they find people playing the exact same game as them "interesting."