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Have about 90 books in my iBooks collection. Ka-Ching!

Even though I think this case if a load of crap, I'll take the money. Better than giving more to the lawyers who are the real winners here.
 
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.
That they actually got good legal advice is a speculation, and even if it were true they could have decided to ignore it thinking their strategy was worth the risk. Anyway the publishers settled almost immediately, most likely because their legal advice did not find the laws so ambiguous and the risk of an adverse judgement too high. Apple most likely simply had much more to lose.

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.
The monopoly was not illegally obtained nor illegaly abused, at least until a judge says otherwise. Being a new entrant doesn't mean you can break the law to get a share of the pie, it's obvious you have to make investments which might be costly. Microsoft entered the gaming consoles market with 0% market share and managed to get a good share of the market after years of due investments. Apple wanted to do the same but without the due investment part.

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.
The publishers wanted higher ebooks prices because they wanted to protect their declinig physical books market. They have zero interests in incentiving ebooks sales because in a world dominated by ebooks they become irrelevant: in the digital world you simply don't need them anymore and can publish directly through Amazon/Apple/whatever.
 
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. :mad:

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.

Actually I think Amazon's pricing should be considered more predatory then loss-leader. Otherwise I agree 100%
 
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.
The problem is that nobody went after Amazon's monopoly legally. Borders and BN just went belly-up, Apple and the publishers did this whole collusion mess. Borders is gone, BN is close to gone, publishers stuck their tails between their legs and got a slap, Apple is getting the stick (pending appeal).

Kinda like the teacher that never sees the first punch, and disciplines the 2nd kid.
 
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.

In this case, I think I have it right -- though you can convince with evidence and not an assertion.

From what I understand, Amazon was paying the publishers the price they requested and discounting that price online. The idea was to sell Kindles; if they're paying $12.99 per book but selling it at $9.99, for example, there's no money to be made on content. Even on volume. :rolleyes:

And with respect to the consoles (i.e., Playstation and Xbox), the situation is reversed. My understanding is they cost more to manufacture than the price the market will bear. In this case, they need the content to make any money.
 
In this case, I think I have it right -- though you can convince with evidence and not an assertion.
I offer you this and this article. Some quotes:

Amazon Confirms It Makes No Profit On Kindles
In an interview with the BBC on Wednesday, Jeff Bezos admitted that Amazon sells the Kindle Paperwhite and Kindle Fire HD at cost, making the company literally no profit on the devices.
By offering consumers a device that costs as little as possible (which consumers will likely only buy once) to then purchase the company’s own online content over and over, Amazon is making a strategic move in both customer acquisition and retention. A Kindle Paperwhite may be sold to a consumer for no profit by Amazon, but all the content that consumer will buy thereafter will undoubtedly make up for the difference – especially since Kindle consumers typically start reading more after buying one.
This strategy has worked well for other types of devices that deliver content – such as gaming consoles
While Amazon loses money on each piece of hardware it sells, it makes money from advertising and digital media.

From what I understand, Amazon was paying the publishers the price they requested and discounting that price online. The idea was to sell Kindles; if they're paying $12.99 per book but selling it at $9.99, for example, there's no money to be made on content. Even on volume. :rolleyes:
What you say applies only to some ebooks which are sold as loss leaders. The idea is that selling a few titles at a low price drives more sales to actually profitable titles too, making the whole game overall profitable. But if you can find evidence that Amazon is not profitable in the ebooks market I'd love to see it, the articles I read say otherwise.
 
The [Amazon's] monopoly was not illegally obtained nor illegaly abused, at least until a judge says otherwise.

Speaking of Amazon. Leveraging its dominant market position in online retail to subsidize the cost of Kindles Fires, so it could enter the tablet market and undercut competitors pricing, strikes me as a violation of antitrust law.
 
I think worrying about how much I was "overcharged" for an ebook is missing the point, because I paid what I was willing to pay, for the price advertised; and I would again.

A lot of people don't realize that antitrust law is not about giving consumers a better price, but is about protecting competitors from anticompetitive behavior. It just happens to be the case that competition tends to, but not always, result in lower prices. I don't know that what Apple and the publishers did actually hurt competition.
 
Speaking of Amazon. Leveraging its dominant market position in online retail to subsidize the cost of Kindles Fires, so it could enter the tablet market and undercut competitors pricing, strikes me as a violation of antitrust law.
As already explained gaming consoles follow this same business model: excluding maybe Nintendo (which usually actually makes money from selling the console) all the other vendors sell the console at loss and are profitable thanks to the sales of content, which are the games (not sure it's still true with the Wii U).

I might agree with you if Amazon is actually not profitable in the Kindle department overall (devices + ebooks) and makes up the loss from selling something which has nothing to do with the Kindle (e.g. vacuum cleaners), but even then it most likely is not an antitrust issue until Amazon gets a high enough tablets market share. Again, look at gaming consoles for an easy example: Microsoft burned a lot of money in the first years of the Xbox to enter the highly competitive market already taken by Sony and Nintendo, money which came from the usual microsoft cash cows.
 
Wasn't a lot of this Steve-driven? Hard to see him calmly listening to and following lawyers' advice if he had some momentum and was attacking a goal. Also, the RDF was probably strongest on himself.
 
As already explained gaming consoles follow this same business model: excluding maybe Nintendo (which usually actually makes money from selling the console) all the other vendors sell the console at loss and are profitable thanks to the sales of content, which are the games (not sure it's still true with the Wii U).

I might agree with you if Amazon is actually not profitable in the Kindle department overall (devices + ebooks) and makes up the loss from selling something which has nothing to do with the Kindle (e.g. vacuum cleaners), but even then it most likely is not an antitrust issue until Amazon gets a high enough tablets market share. Again, look at gaming consoles for an easy example: Microsoft burned a lot of money in the first years of the Xbox to enter the highly competitive market already taken by Sony and Nintendo, money which came from the usual microsoft cash cows.

Selling game consoles below cost and making money from license fees paid by game developers is a long standing, and customary business model in that market.

Tablet makers were all in the business of making direct profit from selling hardware, until Amazon came along and was able to undercut prices because of leveraging its online market. Apple runs its stores to drive highly profitable hardware sales; whereas Amazon sells (gives away) hardware to drive store sales. For a low to mid-level hardware vendor without its own content ecosystem, this leveraging by Amazon reduces their ability to compete on price.
 
No. 576: 3am - Wafflehouse hashbrowns... scattered, smothered, and covered.

No. 577: My neighbor's Lhasa Apso (vile creature)

No. 578: Macworld:D

-Things I would give up to never see another legal post on MR.
 
Selling game consoles below cost and making money from license fees paid by game developers is a long standing, and customary business model in that market.

Tablet makers were all in the business of making direct profit from selling hardware, until Amazon came along and was able to undercut prices because of leveraging its online market. Apple runs its stores to drive highly profitable hardware sales; whereas Amazon sells (gives away) hardware to drive store sales. For a low to mid-level hardware vendor without its own content ecosystem, this leveraging by Amazon reduces their ability to compete on price.
It does not matter which business model was customary or more popular, having competitors accustomed to a different model doesn't make trying another business model illegal. A competitor can try a different business model as long as it's legal and that's the only question. Since the same exact business model happens in the gaming consoles market it's not clear to me why it should be illegal in the tablets market.
 
I assume the $500M (minus lawyer's fees) will be "paid" in the form of iTunes credit. Some may quibble how "real" that $500M is.
 
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:


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.

I think the "unfair" part is why Apple is liable for triple the entire damages caused by all six defendants (minus settlement amounts). Macmillan cited the fact that they would be responsible for the damages of the other publishers as the reason they settled. It they were only potentially responsible for their own damages, they would have went to court.
 
Wasn't a lot of this Steve-driven? Hard to see him calmly listening to and following lawyers' advice if he had some momentum and was attacking a goal.

If Steve was still around, he would be tirelessly working on his defense night and day. He would be all over the press, have special keynotes about this, and convince us how very innocent Apple is. That was Steve's magic, and I know this case would have turned out differently with Steve still at the helm.
 
Selling game consoles below cost and making money from license fees paid by game developers is a long standing, and customary business model in that market.
Is there point with any of that? Perhaps you think the gaming market holds a patent on that business model? Hardly.

Tablet makers were all in the business of making direct profit from selling hardware, until Amazon came along and was able to undercut prices because of leveraging its online market. Apple runs its stores to drive highly profitable hardware sales; whereas Amazon sells (gives away) hardware to drive store sales. For a low to mid-level hardware vendor without its own content ecosystem, this leveraging by Amazon reduces their ability to compete on price.
lol.... Kindle was out for years before the iPad. Keep grasping though.



Michael
 
The really odd thing going on here is that Apple and the big publishers are being charged with colluding with each other in order to not let the monopoly player (Amazon) fix prices. This is a rather radical reinterpretation of anti-trust law.

That is, Apple and the publishers are charged with following the entirely normal practice of wholesalers setting a price and retailers setting a markup on that prices.

If this was limited to Apples "most favored" clause it would be different. But that's not DOJs argument. DOJ seems to be arguing that Apple has a monopoly on the retail sales of books, movies and music. And that is clearly false.
 
Amazing that people don't see that this is a scam for lawyers to make millions and you the people (who they are supposedly fighting for) get $3.00 and change. Class action drains the economy and makes the rich (Lawyers) richer and the poor (you) poorer. What suckers you are. All they have to do is dangle "free money" in your face and you take the bate hook, line, and sinker. Someone is making a lot of money and it's not you.
 
Consumers don't want refunds. Consumers want Apple to be able to compete with Amazon in this market to drive competition and innovation forward.

If that implies expensive eBooks, no! I do not want competition. Competition is normally good because it brings the prices down. That is not what happened.

And people like you will say, "if amazon creates a monopoly then the prices will increase". Well, if that happens I'm sure that the competition will enter in the market and offer some affordable eBooks.
 
That they actually got good legal advice is a speculation, and even if it were true they could have decided to ignore it thinking their strategy was worth the risk. Anyway the publishers settled almost immediately, most likely because their legal advice did not find the laws so ambiguous and the risk of an adverse judgement too high. Apple most likely simply had much more to lose.


The monopoly was not illegally obtained nor illegaly abused, at least until a judge says otherwise. Being a new entrant doesn't mean you can break the law to get a share of the pie, it's obvious you have to make investments which might be costly. Microsoft entered the gaming consoles market with 0% market share and managed to get a good share of the market after years of due investments. Apple wanted to do the same but without the due investment part.


The publishers wanted higher ebooks prices because they wanted to protect their declinig physical books market. They have zero interests in incentiving ebooks sales because in a world dominated by ebooks they become irrelevant: in the digital world you simply don't need them anymore and can publish directly through Amazon/Apple/whatever.

It's not speculation that apple had legal advice, some of the lawyers involved were called to testify. Apple seems to have a lot of lawyers, maybe they ignore them, who knows. On the other hand, are you speculating that Apple knowingly broke the antitrust law because it thought it "was worth the risk", or do you have some evidence to that effect?

That the publisher's settled says nothing about Apple's legal position. Apple played a different role in the deal. The publishers settlement with DOJ is a business decision, it simply shows that an admission of guilt and a fine was less expensive than the cost of defending themselves. Apple has publicly stated that they don't believe they did anything wrong and choose defend themselves rather than admitting to guilty. Some people may choose to believe that they are lying, but Apple has a history of putting their money where their mouth is when it comes to being a socially responsible company, that earns them the benefit of the doubt with me.

Amazon's obtained their 90% share of the e-book by being the first on the scene with a good e-reader, eBook store, and content delivery system; they earned that 90%. But e-books were not a "free market" where competition sets a fair price and drives innovation. I'm a capitalist at heart; I just happen to think that free markets are better.

The deals that Apple cut with the publishers don't seem unfair to me; publishers set the price for their product, pay Apple a share for the sale, and let Apple sell for as good a price as anybody else. Apple didn't dictate how the publishers made deals with anybody else. And Amazon wound up getting the same deal. It seems far more likely that another business could profitably enter into the e-book market following Apple's deal than before, so the market would be more likely to see competition. What Apple did with their deals was to eliminated Amazon's barrier to competition, a barrier Amazon held in place by selling popular e-Books at a loss.

Your example about Microsoft and X-Box is good, and Apple has frequently done the same thin. They win some, they loose some, it's how business works. But as long as Amazon was selling e-books at a loss, I don't see how Apple or anybody else could enter the market and expect to eventually make a profit on e-books. Do you have some profitable business plan in mind?

Your comment on why "The publishers wanted higher ebooks prices" is speculation. My suggestion that higher e-book prices would be an incentive for publishers to bringing more of their catalog to the e-book market is also speculation, but is the sort of things successful business do, they increase supply when there is a demand.


But may main point was that I think we have a problem in the US with antitrust laws. The laws should be clear, and I don't think they are (although I admit I am not a lawyer). I think there should be a compelling reason for the government to intercede in the free market, and in this case I don't see one. I don't see how DOJ's action promotes free and fair competition in the market.
 
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