2 of 3 Judges appear to favor Apple in ebook appeal

[crane3]

OTH, the judges may have felt that apple will just get ANOTHER presidential pardon if apple were found "guilty".

[DuckieTigger]

Originally Posted by crane3

OTH, the judges may have felt that apple will just get ANOTHER presidential pardon if apple were found "guilty".

Oh let's hope it will drag out for another two years and we will have a different president.

[pwalker8]

Originally Posted by eschwartz

If you are going to engage in fanboi debate, at least get your listening skills right -- oh wait, that's the whole point.

In any event, it may have eluded your notice, but you are the only person who says things, and keeps saying them, about Agency and price-fixing being syonymous.

Why yes, they did fix prices. Yes, they forced the agency model. No, those aren't the same thing, and no, we don't think they are anyway -- no matter how much you accuse us of it.

You do the same thing every time you get backed into a hole.

No, I'm the one that points out that price fixing and agency pricing _not_ being synonymous. I'm not the one who keeps claiming that Apple was engaged in price fixing. No they didn't fix prices. They were not accused by either the Government or Judge Cote of price fixing. That doesn't change no matter how much some here keeps asserting that it is the case. If you have evidence that Apple was guilty of price fixing, i.e. setting prices, (other than your own wishful thinking, that is), then I'm sure the DOJ and Judge Cote would love to see it.

[pwalker8]

Originally Posted by DuckieTigger

Oh let's hope it will drag out for another two years and we will have a different president.

Unless either Apple or the DOJ decide to drop the matter after the upcoming appeal court ruling, it's quite likely to drag out another two years. Of course, since no one was sentenced to jail time, it's unlikely any president will become involved.

[JSWolf]

pwalker8, you have not once agreed with anyone that Apple and the price fix six did indeed drive smaller eBook stores out of business such as Fictionwise, BooksOnBoard, and Diesel eBooks.

If you think Apple and the price fix six did not do so, please explain how that did not happen when it actually did happen?

[pwalker8]

Originally Posted by JSWolf

pwalker8, you have not once agreed with anyone that Apple and the price fix six did indeed drive smaller eBook stores out of business such as Fictionwise, BooksOnBoard, and Diesel eBooks.

If you think Apple and the price fix six did not do so, please explain how that did not happen when it actually did happen?

No, I haven't because they were not accused of price fixing. The publishers were accused of agreeing to hold the line on agency pricing and Apple is accused of conspiring with them.

No, I haven't agreed that Apple and the publishers drove smaller eBook stores out of business. For one thing, Fictionwise was bought out _before_ Apple got in the ebook business and before the publishers got Amazon to agree to agency pricing. I find it very unlikely that Apple, the # 3 ebook store behind Amazon and B&N (who bought Fictionwise) drove anyone out of business. It's a lot more likely that if anyone drove them out of business, it was Amazon with their loss leader pricing.

My personal belief is that those companies went out of business and Sony pulled out of the ebook store business as part of the normal course of the definition of the ebook market. The creative destruction involved in the free market occurs in pretty much every line of business. According to the Small Business Association, 8 out of 10 new businesses fail in their first three years. I don't know why people seem to think that ebook stores are somehow magically exempt from those hard facts.

[JSWolf]

Originally Posted by pwalker8

No, I haven't because they were not accused of price fixing. The publishers were accused of agreeing to hold the line on agency pricing and Apple is accused of conspiring with them.

No, I haven't agreed that Apple and the publishers drove smaller eBook stores out of business. For one thing, Fictionwise was bought out _before_ Apple got in the ebook business and before the publishers got Amazon to agree to agency pricing. I find it very unlikely that Apple, the # 3 ebook store behind Amazon and B&N (who bought Fictionwise) drove anyone out of business. It's a lot more likely that if anyone drove them out of business, it was Amazon with their loss leader pricing.

My personal belief is that those companies went out of business and Sony pulled out of the ebook store business as part of the normal course of the definition of the ebook market. The creative destruction involved in the free market occurs in pretty much every line of business. According to the Small Business Association, 8 out of 10 new businesses fail in their first three years. I don't know why people seem to think that ebook stores are somehow magically exempt from those hard facts.

Then please explain how as soon as agency started, that Fictionwise had to stop their business model that had served them well before agency? Tell me how BooksOnBoard had to stop giving credit back on buying eBooks? Tell me how Diesel eBooks had to stop giving discounts on eBook bundles when agency started? Tell me why these three shop had to stop their business models the day agency started? Fictionwise only lasted as long as they did after agency because B&N bough them. Otherwise, they'd have gone under sooner.

They did fix prices. They fixed them so no sales and discounts were allowed. They fixed them so they went up. They colluded to fix prices. They drove some smaller eBook shops out of business because they way they were no longer allowed to do business the way they were before agency.

Amazon's loss leader pricing had nothing to do with these shops going out of business. When they went out of business Amazon wasn't able to have these loss leader eBooks from the BPHs because of agency. So the prices were the same. If Amazon's loss leaders were the reason they closed, then they would have closed before agency. It wasn't Amazon that closed these shops. It was agency. Agency took away what made these shops different, what drove customers to shop there.

[Purple Lady]

Originally Posted by JSWolf

Amazon's loss leader pricing had nothing to do with these shops going out of business. When they went out of business Amazon wasn't able to have these loss leader eBooks from the BPHs because of agency. So the prices were the same. If Amazon's loss leaders were the reason they closed, then they would have closed before agency. It wasn't Amazon that closed these shops. It was agency. Agency took away what made these shops different, what drove customers to shop there.

Excellent point - Amazon had no price advantage after agency. Agency took away the advantage the smaller shops had with their business models that were no longer allowed after agency.

When prices are all the same the only thing to compete on is customer service, and Amazon is better than all the rest there. Agency gave Amazon a big advantage.

[eschwartz]

Originally Posted by pwalker8

No, I haven't because they were not accused of price fixing. The publishers were accused of agreeing to hold the line on agency pricing and Apple is accused of conspiring with them.

It must have been some sort of accident then, that all those new releases went in lockstep to specific price points.

Agency was used as the vehicle for price-fixing. That is why Agency was a bad thing -- because, like you are so fond of pointing out, agency itself is not illegal, conspiracy to fix prices is.

No, I haven't agreed that Apple and the publishers drove smaller eBook stores out of business. For one thing, Fictionwise was bought out _before_ Apple got in the ebook business and before the publishers got Amazon to agree to agency pricing. I find it very unlikely that Apple, the # 3 ebook store behind Amazon and B&N (who bought Fictionwise) drove anyone out of business. It's a lot more likely that if anyone drove them out of business, it was Amazon with their loss leader pricing.

Apple struck a blow to the business strategy of small bookstores. Amazon and B&N did not.

What on earth possesses you to think the #3 ebook store cannot destroy #'s 4-9999 simply because #1 & #2 are bigger than #3?

My personal belief is that those companies went out of business and Sony pulled out of the ebook store business as part of the normal course of the definition of the ebook market. The creative destruction involved in the free market occurs in pretty much every line of business. According to the Small Business Association, 8 out of 10 new businesses fail in their first three years. I don't know why people seem to think that ebook stores are somehow magically exempt from those hard facts.

That is certainly one possibility, but it doesn't fit all the facts of this particular case.

The small ebookstores were doing fairly well until agency, then suddenly they all failed at more or less the same time.

[Fbone]

Originally Posted by eschwartz

[edited]

The small ebookstores were doing fairly well until agency, then suddenly they all failed at more or less the same time.

Do you have the financial records to prove this statement?

[Barcey]

Originally Posted by Fbone

Do you have the financial records to prove this statement?

It's part of ongoing legal action.

Founded in 2006 by Bob LiVolsi, BooksOnBoard's business model was based on "aggressively pricing a wide selection of e-books" as well as a rewards program designed to develop customer loyalty. "Given BooksOnBoard's favorable growth pattern and increasing popularity with consumers, it received a valuation of $6 million based on funding it raised in June 2009," the suit claims.

The Diesel e-bookstore (now Lovoho), was founded in 2005 by Scott Redford. It claims to have offered over three million titles and "the cornerstone" of its business model was also discounted bundling, including "proprietary software that would allow its e-bookstore to 'shrink wrap' up to six digital e-books and sell them as a bundle to the consumer." Diesel also offered a rewards program. Diesel had enjoyed steady growth "every single year," the suit claims, with "modest profits" and a "large expansion" planned for 2011.

BooksOnBoard lost "80% of its active customers" as "a direct result of the conspiracy," its suit claims. After the agency switch, the company's "years of steady growth abruptly ceased" and its revenue and profit plunged. "Two years after receiving a valuation of $6 million, BooksOnBoard received an offer for $600,000, a 90% percent drop in value." It ceased operations on April 6, 2013.

http://www.publishersweekly.com/pw/b...st-claims.html

[Fbone]

Thank you for that

Books on Board required funding from venture capitalists in June 2009. Interesting.
Also, Diesel was planning to switch to a social ebook business prior to Agency.

However, I would prefer to see actual financial records from these two companies rather than claims made by their attorneys.

[JSWolf]

Originally Posted by Purple Lady

Excellent point - Amazon had no price advantage after agency. Agency took away the advantage the smaller shops had with their business models that were no longer allowed after agency.

When prices are all the same the only thing to compete on is customer service, and Amazon is better than all the rest there. Agency gave Amazon a big advantage.

Fictionwise had good customer service. So did BooksOnBoard. I cannot speak about Diesel's customer service as I never had a reason to use it.

My reason Amazon flourished is that after agency when prices were the same, there was no reason to go looking around for better prices. So for Kindle owners, there was no reason to go shopping elsewhere. What the Apple and the price fix 6 did was drive more business Amazon's way when they went agency. They thought that everyone having the same price would hurt Amazon because they could no longer have $9.99 best sellers. But Amazon made out and the little guys got hit hard.

[pwalker8]

Originally Posted by eschwartz

It must have been some sort of accident then, that all those new releases went in lockstep to specific price points.

Agency was used as the vehicle for price-fixing. That is why Agency was a bad thing -- because, like you are so fond of pointing out, agency itself is not illegal, conspiracy to fix prices is.



Apple struck a blow to the business strategy of small bookstores. Amazon and B&N did not.

What on earth possesses you to think the #3 ebook store cannot destroy #'s 4-9999 simply because #1 & #2 are bigger than #3?



That is certainly one possibility, but it doesn't fit all the facts of this particular case.

The small ebookstores were doing fairly well until agency, then suddenly they all failed at more or less the same time.

When you have 0-10 percent of the market, it's pretty hard to have much of an effect. As was pointed out elsewhere in this thread, the small ebookstores _weren't_ doing fairly well, they were scrambling for funding. The number one reason that small businesses fail is that they are under funded and don't have the capital to survive when the big boys enter the market.

Here is the basic timeline of the various ebook stores.

fictionwise started in 2000, about the same time that baen books started doing ebooks
Diesel ebooks started around 2004.
BooksOnBoard started in 2006.
Kindle came out in November, 2007
B&N bought Fictionwise in March, 2009
The Nook was announced in Oct, 2009 and opened up in Nov, 2009.
The Apple ebook store was announced in January of 2010 and released in April, 2010.

In the case of the small ebook stores, the biggest issue that most of them had was it was too cumbersome for the average customer (i.e. one who is not computer savy) to get the ebooks from the store onto their reading device. That was possibly the biggest advantage that Amazon has with the kindle.

The most likely explanation is that the small ebook stores that started before the Kindle and Amazon ebook store, had a business plan that allowed them to survive as a little fish in a little pond, but didn't have the resources to maintain their customer base once Amazon, B&N and Apple entered the market. Ebooks went from a niche market, to a major market. It doesn't require a conspiracy theory to explain something that happens all the time.

When my local SF&Mystery bookstore went belly up after Barnes and Noble hit town, I didn't assume that B&N conspired to drive him out of business. I knew that as a small business owner, he was just getting by on a very narrow margin and simply couldn't compete with the economic scale that B&N had.

[JSWolf]

You totally got it all wrong. Apple and the price fix 6 thought that when the price differences between Amazon and all other eBook shop was equalized, that customers would shop at other stores. That didn't happen. That just kept Kindle owners shopping at Amazon.

When Fictionwise was in full swing before agency, there were lots of threads about Fictionwise. Lots of MR users shopped there. I know I did.

Apple's entry into the eBook market would not have cause these little shops to fold if if wasn't for agency. Agency caused the little stores to have to stop the discounts, sales, rewards, buyers clubs and so forth.

What was meant to hurt Amazon helped Amazon. It hurt the little guys instead of Amazon. It backfired big time and Apple and the price fix 6 should be punished for causing good stores to go under.

I'm sorry you are blind to the facts. The facts are, that these store were competitive with Amazon and people shopped there. After they stopped being competitive (BECAUSE OF AGENCY), people had no reason to go there so they shopped elsewhere.

How can you not get it? How can you see things that don't exist? You remind me of the conspiracy theorists who think the moon landing was fake and that 9/11 was masterminded by the US government.