DOJ Says Publishers Are Again Colluding in Objecting to Proposed Apple Penalty in E-Book Case

[elistan]

Edit - I now see the question was already answered, sorry.

Do you have a link to back up your Amazon comment regarding it not being profitable?

Their quarterly report from July:

http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MTk0ODAwfENoaWxkSUQ9LTF8VHlwZT0z&t=1

Net loss was $7 million in the second quarter, or $0.02 per diluted share...

Granted, they've done a lot better in the past and I suspect that if you add up all profits and losses, they'll come out ahead. But the statement that they're not currently a profitable company is a true one.

You can download all their quarterly reports here:
http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-reportsother

 

[Rocketman]

So, it's ok for Apple to build something for $100 and sell it for $650, but it's not ok for Amazon to buy a book for $10, and sell it to me for $7? Screw that. I'm in Amazon's court all the way on this one.

Let's at least be clear. You are a socialist not a capitalist. You feel profit is bad and giving free stuff to citizens from others is good.

CCCP.

 

[doboy]

mommy mommy they are colluding.

 

[Michael Goff]

Let's at least be clear. You are a socialist not a capitalist. You feel profit is bad and giving free stuff to citizens from others is good.

CCCP.

Profit isn't bad, but if somebody wants to lower prices that isn't bad either.

 

[Rocketman]

It would be nice to see a states attorney charge the AG with extortion. It will never happen, but it would be nice (and right).

And it's entire staff for "collusion" and "Conspiracy".

http://criminal.findlaw.com/criminal-charges/conspiracy.html

A criminal conspiracy exists when two or more people agree to commit almost any unlawful act, then take some action toward its completion. The action taken need not itself be a crime, but it must indicate that those involved in the conspiracy knew of the plan and intended to break the law. One person may be charged with and convicted of both conspiracy and the underlying crime based on the same circumstances.

 

[macfacts]

As a consumer, I don't need to be protected. If I think Apple charges to much for books, I'll go to Barnes & Noble to buy a book or get a Kindle. I have choices. It's not like Apple is the only place I can buy a book.

Except that Apple made it so that all the big publishers agree that ebooks sold else where will be the same or higher prices compared to iBooks store. So you can not goto Barnes & Noble to get a lower price. You can only buy it at Barnes & Nobles for the same or higher price as in the iBooks store.

 

[IGregory]

Thanks to those of you who answered my query concerning Amazon suffering a loss.

 

[BaldiMac]

Except that Apple made it so that all the big publishers agree that ebooks sold else where will be the same or higher prices compared to iBooks store. So you can not goto Barnes & Noble to get a lower price. You can only buy it at Barnes & Nobles for the same or higher price as in the iBooks store.

But you can buy a different book at a lower price.

 

[LordVic]

Except that Apple made it so that all the big publishers agree that ebooks sold else where will be the same or higher prices compared to iBooks store. So you can not goto Barnes & Noble to get a lower price. You can only buy it at Barnes & Nobles for the same or higher price as in the iBooks store.

and also don't forget to include that they all agreed together, that if a store / reseller refused the terms of one publisher's agency model and pricing, that the store would be refused books from all 5 publishers.

 

[Rocketman]

Profit isn't bad, but if somebody wants to lower prices that isn't bad either.

By force of government and regulatory agency "coersion". No.

Our "anti-trust" laws are being misused and are over-burdensome to begin with, and what's worse, usually completed decades after it's too late (Standard Oil, IBM, Microsoft). Now regulators have discovered they can do things proactively because they have unilateral power under the law. That is anti-constitutional and anti-American. I'm sorry.

BTW breaking up Standard oil caused the Arab (kingdom) states to have a monopoly instead so they formed OPEC. We exported OUR monopoly, which was a "benevolent dictator" (and to our advantage), to Arabia.

Sometimes right trumps some made up law. Virtually always the actual private sector outcomes trumps the government deciding things, or the government regulating the private sector, leading to wild outcomes (1979, 1999, 2008, etc.)

 

[bsolar]

Do you for Amazon profits?

As example this article offers some estimates:

Amazon reveals almost nothing about its sales or profits, so we have to rely on the estimates of analysts. Scott Devitt at Morgan Stanley did his best to break it down, and he believes the Kindle business is highly profitable for Amazon.

The chart shows ebooks as the largest estimated profit makers. Being estimates they could be wrong, but I have no reason to doubt them, or at least to doubt them so much to go from "higly profitable" to "at loss". Anyway if you want to accuse Amazon of predatory pricing the burden of proof is yours.

 

[BaldiMac]

As example this article offers some estimates:


The chart shows ebooks as the largest estimated profit makers. Being estimates they could be wrong, but I have no reason to doubt them, or at least to doubt them so much to go from "higly profitable" to "at loss". Anyway if you want to accuse Amazon of predatory pricing the burden of proof is yours.

A bit disingenuous to use estimated profits under agency pricing to prove your point.

 

[NorEaster]

Yeah, it could be "viewed" like that. Imagine if Carlos Slim Helu, with his $73,000,000,000 fortune decided to pay publishers whatever they wanted for e-books and sell them to us for a nickel. What does he care? His billion-dollar businesses cover the loss a billion times over and he still goes to bed filthy rich. Plus no one buys e-books from anyone else. And while they're shopping for e-books, maybe they'll buy an America Movil phone card.

Now you understand the Amazon e-book model. And the DOJ has a problem with ... wait for it ... Apple.

Why is Amazon's business model a problem? I'd easily bet $100 that the Apple fanatics criticizing Amazon are the same ones that will quickly take advantage of a sale on cereal, fruit, meat, etc at their local grocery store. Grocery stores sell some products at a loss ALL OF THE TIME in order to get customers into their stores. This is why they advertise lower prices on certain items on a weekly basis.

And Apple actually does the same, albeit not that often. I purchased a MBP in 2011 when Apple was offering a special on Epson printers. The price of the printer incentivized me to buy the MBP.

You fanatics really need to take off the blinders and turn off the RDF.

 

[bsolar]

But the statement that they're not currently a profitable company is a true one.

That statement is the wrong one to verify. If they are profitable in selling ebooks but make a ton of losses in selling vacuum cleaners, you cannot hope to successfully sue them for predatory pricing the ebooks, even if overall the company is not profitable due to the vacuum cleaners' sales.

 

[Tinmania]

But you can buy a different book at a lower price.

Unbelievable. So your solution is to just say, sorry, buy a different book? Let them eat cake too, I suppose, if food was too expensive.



Michael

 

[BaldiMac]

Why is Amazon's business model a problem? I'd easily bet $100 that the Apple fanatics criticizing Amazon are the same ones that will quickly take advantage of a sale on cereal, fruit, meat, etc at their local grocery store. Grocery stores sell some products at a loss ALL OF THE TIME in order to get customers into their stores. This is why they advertise lower prices on certain items on a weekly basis.

And Apple actually does the same, albeit not that often. I purchased a MBP in 2011 when Apple was offering a special on Epson printers. The price of the printer incentivized me to buy the MBP.

You fanatics really need to take off the blinders and turn off the RDF.

Or you could take some time to understand the differences between a loss leader strategy and predatory pricing.

HINT: It's not black and white.

----------

Unbelievable. So your solution is to just say, sorry, buy a different book?

Yep. That's how a free market works.

 

[macUser2007]

But you can buy a different book at a lower price.

Sure. The problem is, the content is different.

I am happy the DOJ is going after this. Since Apple instigated and enabled this collusion, prices have more than doubled for many titles (one example is Updike's Rabbit Run).

Also, with the incentive to shop around removed, consumers become locked to the hardware they buy and smaller sellers are eliminated from the market. I wish the DOJ would remove the ability to use DRM to keep consumers tied to whatever hardware/store scheme they have made their purchases on. Ebook should be freely transferable among different devices.

Apple dramatically disrupted the market, in a bad way, and should pay for it.

The higher prices will inevitable result in increased piracy and the publishers will deserve the result.

 

[jay-t]

Apple should just move their HQ to another country like Canada.

Don't worry. Once the mothership is completed they'll fly to any country they want

 

[LordVic]

Apple should just move their HQ to another country like Canada.

didnt see this and have to laugh.

I dont think you realize that business regulations in Canada are far stricter than those in the United states and there is a heavy government involvement in business operations.

Corporations aren't treated up with the same rights as people and are expected by the general population and when they do wrong, are held in strict contempt that often gets the government involved.

want a good recent example? Go check out the RBC overseas employee scandal.

 

[bbeagle]

Except that Apple made it so that all the big publishers agree that ebooks sold else where will be the same or higher prices compared to iBooks store. So you can not goto Barnes & Noble to get a lower price. You can only buy it at Barnes & Nobles for the same or higher price as in the iBooks store.

I seriously don't understand this at all.

I make a widget. I sell it to Walmart for $5, Walmart sells it for $10. Sometimes they put it on sale for $7, but it's usually $10 - it's up to Walmart.

Target comes along and says, 'We would like to sell your widget. We'll sell it for whatever price you want as long as we get 30%. Also, you can't sell it to anyone else who will price it for less than what you sell it for here.'

If you sell the widget to Target for $7, Target sells it for $10. You now tell Walmart that it must be sold for $10 or they can't sell it.

Walmart has the choice to (a) NOT sell your widget anymore, (b) agree to sell it for $10 and not put it on sale.

What is illegal about this? It seems more free market than anything.

Walmart can always counter the offer with a better deal. Walmart is not 'stuck' with Target's deal. They have nothing to do with that. Walmart is bigger, they can refuse to carry your widget if they wanted to, and you might lose sales. It's all the free market system at work.

 

[BaldiMac]

Sure. The problem is, the content is different.

A problem? Definitely. Just not a legal one.

 

[BeauPaul]

This used to be America!

If you don't like the prices don't buy it - they would have come down just to compete with Amazon which by the way is where I buy my ebooks and read on Kindle for iPad.

 

[liavman]

I think it is time Obama have a WTF conversation with Eric H. Holder

 

[aristotle]

didnt see this and have to laugh.

I dont think you realize that business regulations in Canada are far stricter than those in the United states and there is a heavy government involvement in business operations.

Corporations aren't treated up with the same rights as people and are expected by the general population and when they do wrong, are held in strict contempt that often gets the government involved.

want a good recent example? Go check out the RBC overseas employee scandal.

So this is a problem how exactly? The regulations are stricter but we also have stricter parliamentary rules including conflict of interest rules which help prevent certain types of corruption in the government.

In this case, it appears that the DOJ is trying to punish a smaller player for trying to destroy the monopoly that Amazon had. Prior to the introduction of the agency model which gave individual publishers the power to set prices instead of the retailer, Amazon had a virtual monopoly. Apple also was not the sole benefactor of the agency model as other parties were also able to enter the space.

The DOJ is trying to rebuild barriers to entry instead of pulling them down.

Also, Canada tends to have a tradition of having judges interpret legislation based on the preamble rather than making a subjective determination. If the crown tries to bring an anti-combines lawsuit against a company, they are going to be smacked down if their case rationale contravenes either the intent of the law or the wording of the law. The intent is usually spelled out in the preamble.

 

[Gasu E.]

So we could remove the POTUS from office. He's more vulnerable than Bill Clinton ever was, I don't understand why the house hasn't even tried.

They are kind of busy voting to repeal the Affordable Care Act for the 43rd time. If they vote to repeal it 100 times, the Constitution says it automatically gets repealed without the approval of the Senate or the President. Don't you ever read the Constitution?