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http://arstechnica.com/tech-policy/...-e-book-price-conspiracy-in-the-judges-words/

"(Judge)Cote described how Apple struck agreements with each of the five publisher defendants—who settled the case before trial—in order to push e-book rates higher than Amazon's. The negotiations happened in the seven weeks leading up to the January 27, 2010 announcement of the iPad."

With a wholesale model, Apple would purchase e-books and resell them at a price of its choosing, whereas with an agency model "a publisher sets the retail price and the retailer sells the e-book as its agent." Apple would become the agent selling the books, taking a 30 percent commission on each sale, just as it does with its App Store.

But Apple did not want to open an e-book store at all unless it was profitable, Cote wrote, and in order to make it work, the company had to deal with Amazon. Apple had even considered proposing a partnership with Amazon, "with iTunes acting as 'an e-book reseller exclusive to Amazon and Amazon becom[ing] an audio/video iTunes reseller exclusive to Apple,'" Cote wrote.

"Apple realized, however, that in handing over pricing decisions to the Publishers, it needed to restrain their desire to raise e-book prices sky high," Cote wrote. "It decided to require retail prices to be restrained by pricing tiers with caps. While Apple was willing to raise e-book prices by as much as 50 percent over Amazon’s $9.99, it did not want to be embarrassed by what it considered unrealistically high prices."

The agency model (along with publisher-set but capped prices of $12.99 to $14.99) made it profitable enough for Apple to open its own e-book store—so long as Amazon's prices went up, too. Apple thus devised a Most Favored Nation (MFN) clause in its contracts with publishers which "guaranteed that the e-books in Apple’s e-bookstore would be sold for the lowest retail price available in the marketplace," Cote wrote."

"The MFN approach "eliminated any risk that Apple would ever have to compete on price when selling e-books, while as a practical matter forcing the Publishers to adopt the agency model across the board," the judge wrote.

"A chief stumbling block to raising e-book prices was the Publishers’ fear that Amazon would retaliate against any Publisher who pressured it to raise prices. Each of them could also expect to lose substantial sales if they unilaterally raised the prices of their own e-books and none of their competitors followed suit. This is where Apple’s participation in the conspiracy proved essential. It assured each Publisher Defendant that it would only move forward if a critical mass of the major publishing houses agreed to its agency terms. It promised each Publisher Defendant that it was getting identical terms in its Agreement in every material way. It kept each Publisher Defendant apprised of how many others had agreed to execute Apple’s Agreements. As Cue acknowledged at trial, “I just wanted to assure them that they weren’t going to be alone, so that I would take the fear awa[y] of the Amazon retribution that they were all afraid of.” As a result, the Publisher Defendants understood that each of them shared the same set of risks and rewards."

that's where the collusion came in.

1 publisher = fail to get Amazon to raise price
5 publishers all colluded together = Amazon would have to raise prices
 
If you can't see what is coming with this defeat, I can't help you.
I'm sorry. :apple:

I'm sorry that you let your blind fanaticism force you to see everything in the entire world that isn't Apple as evil.

----------

I do not do not live in fear. Everyone is entitled to their opinions. Steve wanted to take a slice out of Amazon for several reasons. Over the next 2 years people will see the outcome of this court decision. This lawsuit was about 5-10 years down the road. But I'm done with it. As for the DOJ's role all I can say is: "Trust the Government. It worked for the Indians."

It's just cool to kick Apple these days for everything from iPhones to parents not supervising their children making in app purchases on iPads, and I'm sick of it. (not you Sam)

Apple is searching for a new soul now. The next 12m will determine the future. Steve could see the future. You can't hire for that.

I'm just glad I still enjoy the feeling of paper as I turn the page. :apple:

I cannot describe in words how childish it is to end every one of your comments with the logo.
 
Apple star witness Cue was not found credible by the judge

From the ruling, page 44

In this and several other aspects of Cue’s testimony, regrettably, he was not credible. The documentary record and the commercial context of the negotiations leave room for no other conclusion. Apple’s pitch to the Publishers was -- from beginning to end -- a vision for a new industry-wide price schedule. Any other course would have left the Publishers vulnerable to Amazon’s pricing strategies and would have forced Apple to compete on price. Accordingly, Cue’s repeated assertion at trial that his sole “focus” was on thinking about the agency deals and their effects “from an Apple point of view,” cannot be taken at face value. As a savvy negotiator he knew how to place himself in the Publishers’ shoes, understand their interests, and appeal to their concerns, as he eventually admitted toward the end of his testimony.

Page 84
Cue admitted at trial that Apple “expected” each of the Publisher Defendants to demand that Amazon move to an agency model, but denied actually “knowing” that they would. This testimony was not credible, for many reasons. Cue’s denial of prior knowledge of Sargent’s trip to Amazon was particularly brazen given the January 24 email in which Sargent explained his inability to attend the Launch because he would be traveling to Seattle, Jobs’s comment to his biographer on January 28 -- the day of Sargent’s meeting with Amazon -- that the Publisher Defendants “went to Amazon and said, ‘You’re going to sign an agency contract or we’re not going to give you the books,’” a January 30 email exchange between Saul and Cue monitoring news about Amazon’s decision to remove Macmillan’s buy buttons and wondering whether Cue had “talk[ed] with [J]on” Sargent and a January 31 email in which Sargent reported to Cue on the trip.
Page 147

Cue and the Publishers also exchanged many telephone calls. Some of the more dramatic of these calls have already been highlighted. For example, Cue called three Publishers in late December to confirm that they would be willing to adopt an agency model across all of their resellers of e-books if that were a pathway to higher prices. He told Hachette’s Thomas over the telephone that Apple was providing “the best chance for publishers to challenge the 9.99 price point.” Cue called Reidy on January 21 to enlist her help in convincing Macmillan’s Sargent to execute the Agreement, and called Sargent to assist Macmillan’s agency negotiations with Amazon.
 
http://gigaom.com/2013/07/25/apple-could-pay-nearly-500-million-in-ebook-case/
Apple could pay nearly $500 million in ebook case

screen-shot-2013-07-25-at-10-47-26-am1.png
 
Look at the best sellers ebook prices on Amazon, Barnes and Noble, Apple and Google.

These retailers are competing.

Prices have dropped.



Before: no retail pricing competition.
Now: pricing competition and prices have came down. Some of them, way down!!
 
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