Justice Department Presents Opening Arguments Against Apple in E-Book Price Fixing Trial

Discussion in 'MacRumors.com News Discussion' started by MacRumors, Jun 3, 2013.

  1. MacRumors macrumors bot


    Apr 12, 2001

    In a Manhattan courtroom this morning, the U.S. Department of Justice presented its opening arguments in USA v Apple Inc, the antitrust e-book price fixing trial. The DoJ filed suit last April and Apple has consistently defended itself and has said the accusations are "simply not true".

    According to AllThingsD, Justice Department attorney Lawrence Buterman presented the government's case this morning, using a slideshow filled with email and phone record evidence that the government says shows Apple colluded with book publishers to drive up the cost of e-books ahead of the launch of the iBookstore.

    var docstoc_docid="158797523";var docstoc_title="U.S. v. Apple et al Opening Slides";var docstoc_urltitle="U.S. v. Apple et al Opening Slides";​
    For its part, Apple's lead attorney claims the company was using the same strategies that worked when the company was building the iTunes Music Store to get contracts with the major book publishers. From Apple 2.0:
    Eddy Cue -- Apple's senior vice president for Internet Software and Services, and one of its chief negotiators -- sits squarely at the middle of the DoJ's case and was responsible for much of the email and phone traffic mentioned in the government's opening argument. He is expected to take the stand on June 13th.

    The Department of Justice has settled with all of the book publishers initially accused, while Apple remains the main target of the suit.

    Article Link: Justice Department Presents Opening Arguments Against Apple in E-Book Price Fixing Trial
  2. Shrink macrumors G3


    Feb 26, 2011
    New England, USA
    OK, let's get this out of the way now...

    Doesn't the Government have anything better to do...and so on.

  3. bbeagle macrumors 68040


    Oct 19, 2010
    Buffalo, NY
    This lawsuit is ridiculous. Must be funded by Amazon.

    This is all very simple. Book publishers are upset with Amazon because they can't set the prices of their books (they want MORE money not less). They sign with Apple so they can set their own prices. Surprise, surprise, books are higher priced because Book publishers are allowed to set the prices to prices THEY want (higher).

    Amazon should be the one sued, not Apple.
  4. Kaibelf Suspended


    Apr 29, 2009
    Chicago, IL
    So, they decided to charge more than a direct competitor. And that competitor has a free app available on the devices in question, and people can shop there instead. Call the President! :rolleyes:
  5. phillipduran macrumors 65816


    Apr 30, 2008
    The way our government has been going lately, I'd rather they find something like this to keep them busy instead of finding new ways to erode our rights.
  6. SPUY767 macrumors 68000


    Jun 22, 2003
    We should know now that price fixing is only ok when Amazon is doing it in order to run competitors out of business.
  7. pixelpro macrumors member

    Jun 17, 2010
    Whatever happened to free choice?

    Consumers who don't like Apple pricing, can go to Amazon. Its that simple!
  8. iMikeT macrumors 68020

    Jul 8, 2006
    I hope this story gets turned into a made-for-tv drama one day.
  9. TheAppleFairy macrumors 68020


    Mar 28, 2013
    The Clinton Archipelago unfortunately

    I heard rumors that AMC might do a spin-off show with this dude. Not sure if it will be as good as "Breaking Bad" though.
  10. Shadowpig macrumors newbie

    Jan 24, 2013
    Except that isn't what Amazon is doing. Amazon is selling at low/no/negative profit margins, they're hoping to make it up in volume. That isn't price fixing, the publishers still get the wholesale price of their books, Amazon sets the retail price, which is many cases is below what they bought them for from the publishers.

    Now I'm not saying that what Amazon is doing is great for competitors, but it isn't illegal unlike what the publishers and Apple are accused of doing.

    Amazon could be accused of abuse of monopoly power in the market hurting their competitors, but that isn't what this case is about.

    For this case and this case only Amazon didn't do anything *legally* wrong, Apple probably did.
  11. AppleMark, Jun 3, 2013
    Last edited: Jun 3, 2013

    AppleMark macrumors 6502a


    Jun 17, 2009
    The CCTV Capital of the World
    If you knew anything about this issue you would not be asking such a question. :rolleyes:

    It has nothing to do with what Apple and Amazon charge for ebook, in simple terms. It is about why Apple and Amazon [have to] now charge extra for ebooks. It is regarding the [forced] change in business model with publishers supposedly changed by Apple under Steve Job's.

    It's not that simple, Steve said so therefore it must be true.... Right?
  12. silvetti macrumors 6502a


    Nov 24, 2011
    Amazon loses money on ebooks... This is why big corporations win, they can play chicken longer...

    Amazon buys books at 10 dollars sells a 9,99 (they lose 1 cent), how can they make ANY profit from volume sales ?
    They don't and since not that many companies can keep up with losing money (don't forget the cost of running the business itself, not just the buying/selling the merchandise) they just end up running the competition to the ground...

    Go ask your tiny bookshops around the corner.
  13. mjaco002 macrumors member

    Feb 13, 2009
    This looks like the most stupidest lawsuit. So the publishing company and Apple priced their product at a higher rate than Amazon.

    Big deal. The consumer still have the choice to choose between Amazon and iBooks
  14. Small White Car macrumors G4

    Small White Car

    Aug 29, 2006
    Washington DC
    But when the government's entire case pretty much boils down to 'you're charging more than Amazon,' I'd say that what Amazon is doing IS open for discussion.
  15. JarJarThomas macrumors regular


    Mar 18, 2013
    In germany we have an official "book price fixing" mechanism.
    All books have to cost the same at all retailers.
    This is to prevent a big company like amazon to kill all the small book shops.

    So the publisher says "i want that the book costs 14.99". And all retailes have to sell it for that price.
    Only if books are damaged you are allowed to sell them at a significantly lower price (about 1 to 2€).

    I, as a german and proud book reader (both e and paper books), like that basically. Because it leads to the situation that you can buy books everywhere, even at the smallest shop.
    And you can buy ALL books at all shops because there is a common book order mechanism for all book shops.
    This is basically only possible thanks to book price fixing.

    For sure for me as customer at first it sounds great having books only for 9.99 but before apple there was no german ebook market.
    So i am happy to buy sometimes more (in many cases i pay less than 9.99) and have them digital also
  16. DJsteveSD macrumors regular


    Mar 4, 2011
    Dallas, TX
    I'd still like to know why ebooks are more expensive than paper books (besides greed) it should be cheaper since there isnt any production costs or shipping, etc. WTH! :confused:
  17. burnside macrumors 6502

    Jun 8, 2010
    Not really. The deal with Apple and the publishing company meant that Amazon could no longer sell the publisher's books lower than the price the publisher set. Before, Amazon was able to sell a book at their own loss, not the publisher's. The publisher still got the price out of Amazon they wanted. It was Amazon taking the loss and the risk of losing $$$. Apple did not like this strategy and set up a new plan with the publishers which is what the DOJ is highlighting now.


    That is a question for the publishers.
  18. JarJarThomas macrumors regular


    Mar 18, 2013
    One part is higher pirated version count.
    Other part is digital distribution is also not free.
    Depending on the drm system you also have to pay fees,
    and rest is greed
  19. Small White Car macrumors G4

    Small White Car

    Aug 29, 2006
    Washington DC
  20. holmstockd, Jun 3, 2013
    Last edited: Jun 3, 2013

    holmstockd macrumors newbie

    Mar 5, 2010
    I think your point is valid and al though i am not 100% certain of the facts - i think the issue here is that the agencies forced amazon to do it a certain way OR not get the books - and this may or may not have happened if APPLE was not in the picture.

    One could argue that Amazon is free to buy the books at whatever point and still sell them at a loss to gather other business - consumer wins here for sure - BUT competitors can not compete - and that should be investigated by the DOJ as well!

    Again, Apple comes in and FROM WHAT was entered as exhibits seems to sway the publishers to charge what apple thinks they should charge to make sure APPLE gets it ridiculous 30% and in some cases seems to make the publishers lose money - lol - but with the WAY apple handled it forced the publishers to alter the way IT SELLS again i repeat the DEAL IN WHICH AMAZON CAN BUY BOOKS is under new terms consistent in the way apple wanted them to do it.

    At least thats how i see it - I am not a lawyer and don't claim to be one - but my layperson understanding points to me this picture. Lets see what apple has to say - but bottom line its all corporations and the only interest of corporations is MONEY not about the customer! ;)
  21. wiz329 macrumors 6502a

    Apr 19, 2010
    If you're making a negative profit, volume only makes things worse.
  22. burnside macrumors 6502

    Jun 8, 2010
    I'm not disagreeing with the reasons you listed, but it makes it look like a library is brick and motor torrent store. This is 90% greed if not more.
  23. AppleMark macrumors 6502a


    Jun 17, 2009
    The CCTV Capital of the World
    They never used to be....

    In court papers, it is written: "Apple wanted to sell ebooks to the public, but did not want to compete against the low prices Amazon was setting.

    "Apple knew that the major publishers also disliked Amazon's low prices and saw Apple's potential entry as a pathway to higher retail prices industry-wide."

    Its purpose was to force Amazon to raise ebooks to the $9.99 price it had set for the most popular ebook titles because that was substantially below their hardcover prices, according to the government.

    This arrangement guaranteed Apple a 30% commission on each ebook it sold.
  24. musser macrumors member

    Dec 16, 2004

    The DOJ has been rendered irrelevant. They should just show Holder the door and close up shop.

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