Proposed E-Book Publisher Settlement Could See Customers Receiving Up to $3 Per Book Purchased

[MacRumors]

While Apple has been found guilty of conspiring to fix e-book prices as it sought to launch its iBookstore alongside the iPad in early 2010, five publishers involved in the case have already agreed to settle the cases brought against them by state attorneys general and other class-action plaintiffs.

Among the publishers, Hachette, HarperCollins, and Simon & Schuster had previously received court approval for their settlement agreements, and Macmillan and Penguin settlements are now proceeding through the approval phase. Customers who purchased Macmillan or Penguin e-books are now receiving emails informing them about the proposed settlement and their rights and responsibilities with respect to the agreement.

Under the proposal, the Macmillan and Penguin settlement funds would be combined with previous amounts committed by the other publishers, yielding a total fund of $162.25 million to be paid out to consumers who purchased e-books between the iBookstore's April 1, 2010 launch and May 21, 2012.

While the exact amount of reimbursement customers will receive depends on how many end up being included in the program, current estimates suggest that customers could be reimbursed $3.06 for each purchase of an e-book that appeared on the New York Times bestseller list at any point, and $0.73 per non-bestseller book.

The amount of your credit or check will be affected by how many qualifying E-books you purchased. There will be two levels of payments, based on categories of E-books. While the exact amount to be paid per E-book in each category is not yet finalized, the best estimates of payments for each E-book you purchased, based on the Plaintiffs proposed plan for a combined fund, are as follows:

- New York Times bestsellers: $3.06 per E-book. These include titles that were New York Times bestsellers at any time, irrespective of when you purchased the E-book.

- Non-New York Times bestsellers: $.73 per E-book. These E-books include any titles that were not New York Times bestsellers.

Residents of Minnesota will receive a different, higher amount per book because they were not included in the first round of settlements.

Reimbursement methods will also vary based on where e-books were purchased, with Amazon customers receiving automatic account credit while Apple, Barnes & Noble, and Kobo users will have to activate their account credits, or they may request reimbursement by check. Consumers have until October 21 to object to or exclude themselves from the proposed settlement, and a hearing will be held on December 6 to consider approval.

While penalties in the case against Apple have yet to be assessed and Apple has vowed to appeal the verdict, estimates have suggested that Apple could owe as much as $500 million for its role in pushing book publishers to move to an agency model that resulted in higher prices for consumers.

Article Link: Proposed E-Book Publisher Settlement Could See Customers Receiving Up to $3 Per Book Purchased

 

[Brandon263]

Yay, free money!!! But seriously, did Apple think it could get away with this?

 

[Skika]

free monies yay

 

[sransari]

$3 back, but $10 in tax money. o well.

 

[BC2009]

5 Publishers who received 70% of revenue from e-Books across multiple marketplaces (Kindle, Nook, iBookstore) in total owe $162M.

1 Ecosystem Provider (Apple) that received 30% of the e-Books revenue on a single distant-second marketplace may owe $500M.

Hmm..... something about this math does not work.

 

[springsup]

Why do NYT bestsellers get more of a refund?

 

[Thunderhawks]

If anybody has to fill out a claim form and dig for receipts, it's for sure worth the time to get $ 3.06.

 

[bbeagle]

If you bought a regular physical book during that time because it was the same cost as an ebook, shouldn't you be compensated $3? Because you didn't have the option of buying it for $3 cheaper, and you might have bought it for $3 less had the ebook been available at that price!

Just playing devil's advocate... ready for the lawyers to bite this one too.

 

[rillrill]

"I'm old. Gimme Gimme Gimme!"

 

[theheadguy]

Hilarious! It seems like the majority of the people on here were hating the DOJ for proposing ANY kind of punishment or settlement. Now that people might see their own pockets lined with some refunds, haters magically turn into lovers!

It's more interesting from a psychological perspective to see people who still feel bad for Apple and would only be content if there was an Apple legal defense fund they could willingly donate to

 

[bbeagle]

Hilarious! It seems like the majority of the people on here were hating the DOJ for proposing ANY kind of punishment or settlement. Now that people might see their own pockets lined with some refunds, haters magically turn into lovers!

I'm actually against any class-action lawsuits like this (against any company). $3 is ridiculous. If something like a car breaks, and requires $700 part, it's fine to have a class-action lawsuit to get that money back, but $3? This was just made so lawyers could get their cut.

I'm also against this settlement. How does it make any sense at all?

 

[NeroAZ]

If anybody has to fill out a claim form and dig for receipts, it's for sure worth the time to get $ 3.06.

I have purchased ebooks from apple, amazon, and barnes and noble, and have previously received emails saying i'm pre qualified since I've purchased books through them, and will have to do nothing.

I just today received another one from "state attorney general" Administrator@qgemail.com

saying the same, records indicate I am eligible for a payment from settlements, blah blah blah...

 

[nagromme]

People really don't appreciate the complexity of this issue

They like black and white, and they like sound bites. I like this, but it's a bit long--as it must be: http://tidbits.com/article/13912

Yay, free money!!! But seriously, did Apple think it could get away with this?

I don't think this money is coming from Apple.

 

[HadrianM]

Nope.

After all the lawyers get their bite of the pie it will be about 2.501 cents.

 

[jfx94]

I think I bought about 10 books on the 'old' pricing scheme. I bought them at $9.99 each, knowing full well that I could have picked up a paperback copy at a used book store for way cheaper. I bought them for the convenience of travel and reading them on my iPad. I don't see why this law suit should compensate people for their individual decision to spend their money even if the prices were a bit higher. I hate to see litigation like this force Apple to give petty compensation. More damaging than the money is the propagation of the entitlement attitude that so many are eager to cash in on.

 

[Zerilos]

5 Publishers who received 70% of revenue from e-Books across multiple marketplaces (Kindle, Nook, iBookstore) in total owe $162M.

1 Ecosystem Provider (Apple) that received 30% of the e-Books revenue on a single distant-second marketplace may owe $500M.

Hmm..... something about this math does not work.

The publisher all settled with the DOJ out of court, Apple decided to fight the charges.

 

[mac 2005]

I think this whole situation amounts to a perverse interpretation of "anti-trust" laws. In punishing Apple and the publishers for "colluding," the DOJ is rewarding Amazon for its efforts to create a monopoly.

And what does "colluding" in this sense really mean? The publishers offered ebooks at a price well below the price of the printed version. Cost of production and distribution aside, authors and publishers are entitled to make money for their work. There is no "e-book" in "free," or some such pun.

With respect to the refunds, nobody forced consumers to buy them at the set price -- and who is the DOJ to determine what is the fair price? We know that the price Amazon set was intended as a loss-leader to sell more Kindles. So that price is fiction and should not be the basis for anything.

 

[D.T.]

"I'm old. Gimme Gimme Gimme!"

Image

Hahaha ...

"Grampa, where'd you get all that money?"

"The government ... I didn't earn it, I don't need it, but if they miss one payment I'll raise hell!"

 

[bsolar]

5 Publishers who received 70% of revenue from e-Books across multiple marketplaces (Kindle, Nook, iBookstore) in total owe $162M.

1 Ecosystem Provider (Apple) that received 30% of the e-Books revenue on a single distant-second marketplace may owe $500M.

Hmm..... something about this math does not work.

This is due to the fact that the publishers did settle, Apple instead was found guilty in a way which makes it liable to pay triple damages. The issue (math included) is explained in this article. Emphasis mine:

Now, if a verdict is entered after the damages phase of the trial, Apple is on the hook to pay special damages under a section of the Clayton Act that automatically triples antitrust awards.

Apple’s liability, according to lawyer Jeff Friedman, will be determined by this formula: harm to consumers x 3, minus the $166 million paid by the publishers.

The "harm to consumers" was calculated to be around 220M, so you have 220M x 3 - 166M = 494M. Without the "triple damages" clause it would have been 220M - 166M = 54M, which is in the ballpark of what the publishers paid individually. With an early settlement it could have been even less.

 

[Kaibelf]

Wow everyone! Let's just grab a big ole' bucket to catch our winnin's.

 

[Tones2]

With respect to the refunds, nobody forced consumers to buy them at the set price -- and who is the DOJ to determine what is the fair price?

It's about allowing the CONSUMERS to set market price based on fair compeitive forces, not Apple and the publishers colluding to set a model that circumvents that. Yes, the consumers could simply not buy the books, but if they want the book they have no choice then to purchase it at the colluded pricing model that could set a higher price than the free market would set.

And I'm not saying that Amazon wasn't headed towards a monopolistic model. I'm just saying that Apple colluding with publishers is simply wrong and against the law, irrespective of that.

 

[kazmac]

thank you

I have purchased ebooks from apple, amazon, and barnes and noble, and have previously received emails saying i'm pre qualified since I've purchased books through them, and will have to do nothing.

I just today received another one from "state attorney general" Administrator@qgemail.com

saying the same, records indicate I am eligible for a payment from settlements, blah blah blah...

Thanks for posting this info, I also received this email and wasn't sure if it was legit.

 

[bsolar]

I think this whole situation amounts to a perverse interpretation of "anti-trust" laws. In punishing Apple and the publishers for "colluding," the DOJ is rewarding Amazon for its efforts to create a monopoly.

If Apple wants to compete with Amazon there are legal options, but Apple did not want to make the investment to enter the ebooks market competing on price. Another competitor doing great is no excuse to break the law.

And what does "colluding" in this sense really mean? The publishers offered ebooks at a price well below the price of the printed version. Cost of production and distribution aside, authors and publishers are entitled to make money for their work. There is no "e-book" in "free," or some such pun.

Authors and publishers were making more money with the wholesale model. The publishers actually decided to go with Apple's agency model knowing perfectly well that they would have less revenue, even with higher consumer prices.

With respect to the refunds, nobody forced consumers to buy them at the set price -- and who is the DOJ to determine what is the fair price? We know that the price Amazon set was intended as a loss-leader to sell more Kindles. So that price is fiction and should not be the basis for anything.

You have it backwards: Amazon does not make money selling Kindles, it actually makes money selling the content, kinda like a gaming console makes money selling games and not selling the console itself.

 

[PsudoPowerPoint]

The courts get to decide if the law was broken, but do we really need laws to protect us from the business practices that Apple apple engaged in when it established the iBook store. This whole case makes me believe that the US needs to rethink its antitrust laws.

Apple had the advice of legal council when they negotiated with the publishers and undoubtedly believed they were in the clear legally. But the laws were ambiguous enough that despite good legal council they still ran afoul of the law. That suggests to me that there is a problem with the clarity and applicability of the law in the modern world.

Apple was a new entrant in a market dominated by a single retailer with an overwhelming market share, and the power to set the retail price of everything on the e-book market without regard to business interests of the content producers. Apple's deal allowed the five largest content producers to each set the retail price for their own product, seemingly breaking Amazon's monopoly. But in this case the law was used to protect the monopoly, and that makes me think there is a problem with the law.

Once the producers were able to set e-book prices they would have the incentive they needed to make more books available as e-books. And while in the short term prices went up, the increased availability of e-books as a less expensive alternative to physical books, there would have been a net savings to consumers. But the antitrust las as they are now apparently give unelected bureaucrats in the justice department the ability to decide how consumer prices are set rather than leaving it to the free market. I don't believe that the law is right if it gives them that power.

 

[ArtOfWarfare]

Anyone know if Better was ever on the New York Time's best seller list?

I think that's the only book I ever bought through iBooks... I always look around for a few minutes at my options before buying a book and this was the first (and only) time iBooks actually had a price lower than everyone else. I think I spent $9 on it or something like that.