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DOJ Sues Apple and Publishers for Collusion

Discussion in 'Tech Talk - Gadgets, Gizmos and Technology' started by bobukcat, Mar 8, 2012.

  1. Apr 11, 2012 #21 of 165
    davejacobson

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    How can this be true. Isn't Apple the beloved company of the masses.:D
    I know they wouldn't do anything wrong.
     
  2. Apr 11, 2012 #22 of 165
    trh

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    About time. I bought my eBook reader years ago with the promise that eBooks would be significantly cheaper than paper copies. And they were. Until Steve Jobs visited a couple of publishers just before the iPad came out. Then they all went up $3-$5 in price.

    Of course Apple will end up paying less than what they've made. Not much of an incentive to stop them from doing it again.
     
  3. Apr 11, 2012 #23 of 165
    Stewart Vernon

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    I don't know how to feel about this... On the one hand, price-fixing is illegal and should probably be dealt with. On the other hand, Amazon isn't noble either and has been dumping books as loss-leaders to capture the market. You can be sure IF Amazon dominated the e-book market, the prices would go up there again.

    I don't know all the details... but I don't know why in the case of e-books the publisher can't set the price and disallow sales as part of their contract. It isn't like physical inventory where it costs a lot to stock product OR process returns or damages... and I expect the model is such that neither Amazon nor Apple pays anything to a publisher until after the sale of an e-book... so it's not the same as needing to clear the aisle with a clearance sale to make room for new product and move old product that isn't selling.

    An e-book should hold its price essentially forever unless it was overpriced to begin with.
     
  4. Apr 11, 2012 #24 of 165
    Garyunc

    Garyunc Godfather

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    I do love my my ipad but I think if that any parties guilty of this should be heavily fined and refunds would be nice!! I do think the e-book prices are ridiculous. Why should the e-book price be almost as much as the hard cover book price?
     
  5. Apr 11, 2012 #25 of 165
    hdtvfan0001

    hdtvfan0001 DIRECTV A-Team

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    I commend you on your post.
     
  6. Apr 11, 2012 #26 of 165
    trh

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    This is a very good article (IMO) in the New Yorker on Steve Jobs and eBooks and the iPad. New Yorker Jan 2010
     
  7. Apr 11, 2012 #27 of 165
    Stewart Vernon

    Stewart Vernon Leapin' Lizard Staff Member Super Moderator DBSTalk Club

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    As a consumer, I welcome lower prices...

    but...

    Why do people assume e-books should be priced lower than "real" books?

    I grant you that the production costs for an e-book are negligible compared to actually chopping down trees and making real books... but given the author does the creative work to create the content... and what we want to buy/read is that content... why should anyone assume that e-books automatically should or would cost less?

    IF digital replaces actual... and one day there are no more real books made... only e-books... why wouldn't the price for those e-books be whatever the market would bear?

    If you want a real book (I sometimes do) then you should love that the real book costs the same or less (if in a bargain bin) than an e-book! Not chastising that the e-book costs more.

    A CD contains digital music... you can buy digital music online... the same digital music, essentially... so why shouldn't both cost the same?

    I love me some low prices... but entitlement to low prices never makes sense to me.
     
  8. Apr 11, 2012 #28 of 165
    hdtvfan0001

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    The cost to "manufacture" an eBook is <$1.00 on average, according to 6 different NY Time Best Selling Authors who spoke on this subject at book signings I attended with my wife. This topic comes up more and more, and while the authors have some enthusiasm for the eBook format...they also have commented that the pricing is often "beyond what it should be".

    The two top costs are the author contractual pmt. and promotional marketing expenses, which vary per title.

    The underlying key cost on that front is the author payment for what is typically a substantial amount of work. Some authors work on 2-3 books overlapping, others 1 at a time. If that gets reduced significantly, we'll likely all see less books...in any format.

    What then muddies the water are the outside players (like a large payment to iTunes) to simply deliver the content - especially when this can be done far more economically, and is done cheaper through other channels.

    In the case for the topic on hand in this thread, it appears that Apple made an intentional choice to try to manipulate and control the market pricing in their favor to assure their target for profit.

    Doing so with key publishers/distributors is clear collusion and price fixing, which is likely why 3 of the players already came clean to bail out from the heartburn - at least from their participation.

    As a few others have said...this is not the first time (and likely not the last) that this has happened/will happen. Still...it's illegal, unethical, and plain wrong.

    The fact that Apple would not immediately fess up and take their medicine (like the 3 other players so far) demonstrates the degree of their corporate arrogance - which has surfaced on other fronts in the past. This is not to bash Apple, rather, to expose that there is a pattern of this kind of culture at that company which is indefensible.
     
  9. Apr 11, 2012 #29 of 165
    Sixto

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    Yep, I tend to agree, not really sure where I side with this situation, but hopefully it doesn't affect Apple too much. Ever since the switch to the iOS ecosystem the family loves all the integration. Some really cool stuff compared to what we came from. Kids were home for Easter and loved the new addition to the entertainment center (Apple TV) with the integration with iCloud/iPhone/iPad. It just gets better and better.

    We actually use the Kindle App for books, which easily allows the iPad and Kindle Touch to share books. Works great.

    And Macmillan’s CEO sure thinks he didn't do anything wrong: http://www.tor.com/blogs/2012/04/a-message-from-john-sargent

    As with most things, two sides to every story, but if they did do something that's not accepted, then they'll change it and we'll move on with hopefully not much impact.

    Interesting that it's not criminal, rather civil.
     
  10. Apr 11, 2012 #30 of 165
    Stewart Vernon

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    Yeah... that's why I am torn. The collusion and price-fixing allegations are bad news and need to be addressed.

    What I wouldn't want to see, however, is Amazon killing e-book sales with prices so low that authors no longer want to write books.... so it's a case where I kind of have to hope both sides lose!
     
  11. Apr 11, 2012 #31 of 165
    trh

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    According to the New Yorker article, author's royalties went up 10% with eBooks.
    There was a recent survey that showed people with eBook readers increased their reading (therefore more books being sold).
    And didn't Google just announce they are coming up with a program where authors can self-publish on Google and get most of the sales?

    So I don't think authors are going to lose out with eBooks. The publishing industry needs to adapt to the new technologies and get away from an antiquated pricing model.
     
  12. Apr 12, 2012 #32 of 165
    phrelin

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    OK then I'll more or less repeat myself.

    As an old guy, I remember when under state imposed "Fair Trade" statutes, the manufacturer was able to impose a fixed price for items. These fixed prices could offer some price protection to small merchants in competition against larger retail organizations. This began in 1931 during the Great Depression in my state, California.

    It took a long time, but those laws are gone now. What you see is the MSRP which large discount stores ignore completely.

    The idea that in the 21st Century U.S. a manufacturer and a retailer could agree that no one could undersell a price because the manufacturer sets the retail price disturbs me.

    Manufacturers and wholesalers can decide the price they'll sell an item to a retailer. But what the retailer charges is none of their business.

    Any time the Justice Department goes after price fixing done by manufacturers and retailers together, IMHO they should get all the positive accolades possible.
     
  13. Apr 12, 2012 #33 of 165
    hdtvfan0001

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    Kudos -agree.
     
  14. Apr 12, 2012 #34 of 165
    Sixto

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    Seems like if the DOJ wins then it might end with the book industry being worse for publishers, retail chains, and eventually consumers. I guess it all depends on one's perspective. If the goal is for Amazon to have a monopoly, lower prices even at a loss to Amazon, then if they win that may happen. I would think that this could hurt the content creators as well.

    http://news.cnet.com/8301-13578_3-5...o-lose-e-book-antitrust-suit-targeting-apple/

    http://www.nytimes.com/2012/04/12/b...cut-e-book-prices-shaking-rivals.html?_r=1&hp

    The more I read the less it sounds like a good idea for this suit, but we'll see how it plays out.
     
  15. Apr 12, 2012 #35 of 165
    hdtvfan0001

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    The "goal" has always been to have a free market - not one that is manipulated by Apple, publishers, Amazon, or anyone else through illegal collusion and/or price-fixing.

    To be clear....Apple is part of this lawsuit...not Amazon. It's not if people compete, but how.

    As long as authors write books...people will read them. Where they get them, however, will be a market-driven choice.
     
  16. Apr 12, 2012 #36 of 165
    Sixto

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    The previous thread's title was certainly more accurate: "DOJ to Sue Apple and Five Publishers for Collusion":
    The actual title of the article that this thread is based on is: "US says Apple, publishers conspired to fix prices".

    It sure is weird to not see the publishers mentioned in the title.
     
  17. Apr 12, 2012 #37 of 165
    hdtvfan0001

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    Actually...the previous thread and title are obsolete...since 3 of the parties chose to admit their guilt, cease their participation from the illegal practices, and are no longer part of the current lawsuit by the Justice Department.

    The title heading with Apple as the significant named lawsuit target came right from headlines by much of the mainstream media...example...CNN's title below. The two remaining publishing houses appear to be secondary participants.
     

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  18. Apr 12, 2012 #38 of 165
    lparsons21

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    Being an avid reader, I wasn't thrilled with Apple and the publishers getting together to push the price of ebooks up. So on one hand I'm hoping that this benefits us that read a lot.

    One good thing that came out of the push for higher prices was that I started looking for other legal methods to get books. And lo and behold, there are tons of free ebooks out there, and not just the classics. Bunches by new or never before published authors, as well as some early efforts by more established names are available. Many are very good, most are just OK, and some are really bad. But they are free and I've found new authors to watch for.
     
  19. Apr 12, 2012 #39 of 165
    klang

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    It is not as good an Apple bash with the publishers included.

    I agree this should have been combined with the original thread.

    If this results in lower e-book prices from Amazon I'm all for it.
     
  20. Apr 12, 2012 #40 of 165
    hdtvfan0001

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    Excellent point.

    There's that delicate balance between market pricing and enough financial incentive to the content providers (authors/publishers) to supply their products.

    You're right again...there are numerous thousands of free eBooks out there.

    I suspect that the end result of this lawsuit, as well as adjustments that might happen with the Amazon lower pricing that spawned this activity by Apple and the publishers...is to establish some kind of tiered pricing based on the age of the eBook.

    This has already happened where a new Blu Ray disk release is offered for a limited time (usually a week) at an introductory discounted price by retailers, then it changes to a higher price for a period of time...and later it gets reduced in price based on age.

    I would not be surprised to see the publishing world adopt something similar.
     

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