I'm not sure why Amazon and others shouldn't be allowed to offer content sales within their apps, and not pay apple's cut. That is competition and it's generally a good thing. If they aren't using Apple's servers, services, and App Store, (remember this is within their app) then what justifies Apple not allowing competition. It's not what this case was about, but maybe it will be the one good thing to come from this. (For consumers)
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Apple Files Brief Calling Department of Justice Remedy 'Draconian' and 'Punitive'
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Apple has mostly politically liberal and Democratic types (Gore, et.al.) at the top, and thus not been donating sufficiently large piles money and juicy jobs to Republicans and conservative causes, the types who generally want to put the screws on the DOJ to keep it from interfering with big business owning the free market. So they're letting the DOJ run crazy until Apple wises up and put more money on the Red state side of the table.
I am actually quite pleased to see that the government is able to focus on such a critical item in our economy and business. This would indicate that all of the really big problems that impact our society are solved such that these minuscule items can get their needed focus.
Yap, because a government can do just one thing at a time.
So could Apple.
But all snarky remarks aside, Amazon's eBook business is profitable.
They didn't sell everything below wholesale, only selected best sellers.
"and prevent the company from entering into agreements with music, movie, TV show, and book providers that could increase prices for rival retailers." So Apple is not allowed to bid on music, movies, TV shows, and books because that would drive up prices. So Apple is not allowed to be in the business of selling music, movies, TV shows, and books. That's just amazing.
What??? A MFN clause, in itself, is not wrong... An agency model, in itself is not wrong.
BUT, if you combine the two.... The agency model make the publisher fix the retail price, the retailer looses control of it and can no longer discount it. That alone is not particularly good for the consumer as it removes competition (or restricts it). But, it leaves the possibility of different retailers negotiating different deals...
Introduce the MFN clause that says "you can't sell to anyone else cheaper than what you sell to me"... All of a sudden, all the prices become the same, and the guy that negotiates this gets the best price in the industry.
So publishers get a higher "street" price for ebooks which they control, and can fix at a level that protects their print business. At the same time Apple kills it's competition's main marketing tool: Price & discounting. And this allows Apple to introduce its iBooks at a higher price point, and not have to fear competitive pressures from anyone.
There's no way this can objectively be interpreted as being a "good" business practice, unless you're Apple or a publisher. Everyone else in that market looses out without being given a chance to compete. The only things left is "my storefront is more attractive than yours"... And customers in every store end up paying more that they did the day before for no obvious reason.
So yes, these clauses were DIRECTLY responsible for price increases. And they weren't an accident.
What's your point? Like Apple couldn't have leveraged their iPad profits to do the same thing???
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The "regulators" under the executive branch of this "administration" have elected to enter into a wide range of investigations and fines well outside normal executive branch conduct. These actions amount to a shakedown of deep pocket defendants, without suing or fining similarly situated smaller businesses to raise the ire of the media.
I would like to see a list of the top 50 fines issued by the entire executive branch since Obama was sworn as President, or perhaps 6 months later.
This is a shakedown. Yet another.
Apple has the gonads to respond to even the government. I would not be at all surprised to see them simply "change headquarters jurisdictions" to avoid entanglements with excessively arbitrary jurisdictions. I hear Canada is nice this time of decade. I further hear they have a 15% corporate tax. Apple paid 28% in the USA this year.
The government is very hard to fight, and even harder to change, but the largest corporation in the world making products to empower human end users worldwide has better financial, political and mind share capacity than pretty much any other entity worldwide.
Rocketman
I would like to see a list of the top 50 fines issued by the entire executive branch since Obama was sworn as President, or perhaps 6 months later.
This is a shakedown. Yet another.
Apple has the gonads to respond to even the government. I would not be at all surprised to see them simply "change headquarters jurisdictions" to avoid entanglements with excessively arbitrary jurisdictions. I hear Canada is nice this time of decade. I further hear they have a 15% corporate tax. Apple paid 28% in the USA this year.
The government is very hard to fight, and even harder to change, but the largest corporation in the world making products to empower human end users worldwide has better financial, political and mind share capacity than pretty much any other entity worldwide.
Rocketman
Hmm, I'm thinking Microsoft's loyal customers don't dog them out this much Microsoft Enthusiasts forums no matter how asinine MS's decisions are.
Could have. (Except for the sales tax part.) But that shouldn't define healthy competition in a market.
As an avid reader, it was expected that the advent of the digital age of books would see overall costs decrease to the end user in reading, especially since without significant costs associated with print media, the publishers would have ability to offer better prices, and higher margins at the same time.
However, over the last 5 years, it has been a trend that book prices, especially in digital media has increased dramatically, often exceeding that of even print media.
DOJ believes that Apple and the publishers have entered into agreements to fix prices and drive out competition, allowing them arbitrary unilateral control over the market and it's pricing, thus driving the costs of media to the end user up.
this is not competition, nor healthy for any free market system. Claiming that being caught doing this and punished for it is "punitive" amuses me. Of course it's punitive. You're being punished for your actions.
what did you expect, a slap on the wrist and told "dont do that again?"
However, over the last 5 years, it has been a trend that book prices, especially in digital media has increased dramatically, often exceeding that of even print media.
DOJ believes that Apple and the publishers have entered into agreements to fix prices and drive out competition, allowing them arbitrary unilateral control over the market and it's pricing, thus driving the costs of media to the end user up.
this is not competition, nor healthy for any free market system. Claiming that being caught doing this and punished for it is "punitive" amuses me. Of course it's punitive. You're being punished for your actions.
what did you expect, a slap on the wrist and told "dont do that again?"
Ok, I have the same question too. I've read all about this and I still can't wrap my head around what exactly is wrong with it.
Amazon is in a race to the bottom, and Apple attempted a different model that would (in theory) preserve the industry by letting publishers choose their own prices. If the publisher choose to give a lower price to non-Apple, then Apple also got that lower price.
That is my incredibly basic understanding. And yet I don't see what is wrong with that. How is it anti-trust?
I'm not a lawyer. I'm not a Doctorate degree holder. I'm simply asking for someone to explain this in laymans terms why this is illegal.
I'd appreciate if you stepped off your high horse and inform us fellow forum members who don't have as good a grasp at this concept as you apparently do.
Not looking to incite a riot. Thanks in advance.
Hmm, I'm thinking Microsoft's loyal customers don't dog them out this much Microsoft Enthusiasts forums no matter how asinine MS's decisions are.
Cute
No, just an ebook reader actually, and one that was not too thrilled to be forced to be charged more because of these deals.
From my undrestanding, the gross issue here was that part of the deal with Apple, was that no matter what, the publisher WASNT allowed to make lower deals with other retailers.
Apple no matter what HAD to be the lowest deal. no matter what.
So fi apple says they're only selling an ebook at 9.99. and say, is willing to pay publisher 6.99 for that book. No matter what, that publisher could not make a deal with any other place for less than 6.99.
what this did was force competition to the exact same price model. if they could only get their books at 6.99 as well, then it became a "storefront" differentiating factor. NOT price factor to win over sales.
Give that apple then blocked 3rd party sales from app's in appstore, meant that Amazon, Kobo, B&N, could no longer use their own digital apps on iOS devices as their storefront either.
Then Apple takes 30% off the top of any book sold through those digital storefronts because you could ONLY buy them through the in app purchase and not direct from the external source.
Apple used a lot of different little pieces to leverage an overall increase in the industry's prices, for the benefit of their own profits. it was very anti-competitive
Read this article... it's actually pretty decently written about explaining the basics and how all the wheels interact.
http://www.macstories.net/stories/u...legations-against-apple-and-those-publishers/
Rocketman, did you totally miss the point of this whole fiasco? Did you not notice that the European Competition Commission had initiated similar proceedings?
Somewhere along the way you got off your rocket....
Fair, but, I thought publishers had no control over the prices amazon was selling digital books.
So the Apple Bookstore was the only digital store that gave publishers a say in what price their product was sold at. At which point, the "lowest price" rule was fundamentally a stopgap?
Or did that rule extend to the "wholesale" price amazon paid to the publishers?
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THANK YOU. Responses like this are why these forums are great.
Maybe you missed my first post in this thread. How could you possibly come to the conclusion that I think the proposal is "fair."
Well first - this wasn't a case about anti-trust. It was about collusion. And I'm not on a high horse. I was responding to a poster who is going on a tirade when he's clearly not at all (remotely) accurate because he's more concerned with defending Apple then he is about the actual issue.
No arguments from me... we don't have a "Death Star" yet.
I saw the link on Cult of Mac and I though that the heck, I might as well put my name down... I know that it won't really go anywhere.
Jeff
The fundamental flaw is an anti-trust case against Apple, when Amazon is the company in monopoly position regarding books.
This ruling doesn't prevent monopoly, it whole heartedly helps Amazon the monopolist and hands them their only competition on a silver plater.
The DOJ is off the rails again. Why is Holder still there again?
This ruling doesn't prevent monopoly, it whole heartedly helps Amazon the monopolist and hands them their only competition on a silver plater.
The DOJ is off the rails again. Why is Holder still there again?
One of the problems is that publishers forced Amazon to change from wholesale to agency model
The ruling isn't meant to prevent a monopoly. The ruling is to punish Apple for colluding.
Collusion was the crime.
A big part of the problem in all this actually is that publishers, after having signed with Apple, turned around and told others, like Amazon, that they had to adopt the same rules as Apple or they risked loosing the content....
So they leveraged their deal with Apple to strongarm 3rd parties into the same business model (where apple was promised the "best price").
That part wasn't necessarily Apple's fault, but they weren't innocent in this either.
My pleasure