Publishing/Writing: Insights, News, Intrigue

09/10/2012

DOJ’s E-Book Price-Fixing Case = Publishing Intrigue to the Max


 

Blind Justice

Intrigue, indeed — But, is the whole case based upon misconceived intentions, misunderstanding and misplaced justice?

And, just WHO is to blame for letting this price-fixing debacle spawn into a full-blown clusterfuck?

This insight is provided by Jonathan Berr in InvestorPlace.com :

Publishers Have Themselves to Blame for Amazon’s Triumph

The recent ebook price-fixing settlement clearly proves it

Amazon (NASDAQ:AMZN) CEO Jeff Bezos has won the e-book price wars and will leave his competitors in the dust. The publishers that are complaining now have no one but themselves to blame.

Last week, U.S. District Judge Denise Cote approved a settlement between three U.S. publishers — Hachette Book Group, Simon & Schuster and HarperCollins —and the Department of Justice over allegations that they were in cahoots with Apple (NASDAQ:AAPL) to fix the prices of e-books. Apple and two other publishers, Penguin Group USA and Macmillan, have refused to settle. Their case will go to trial next summer. Officials in the publishing industry, who urged Cote to throw the case against them out of court, were appalled by the ruling.

“To say the least, we are colossally disappointed that the judge failed to understand how consumers will be negatively impacted by a decision that does not take into account the realities of the book business in 2012,” said Oren Teicher, CEO of the American Booksellers Association, in a statement posted on the group’s website.

Indeed, the publishing industry argues that it — not Amazon — is the aggrieved party given the Seattle-based company’s dominant position in the e-book market by selling electronic books below cost. Though their fears were understandable, their solution to it was illegal. It’s not even a close call.

Both Apple and the publishers didn’t want to compete with Amazon’s $9.99 price point for e-books. In 2010, they agreed to switch to a new “agency” model whereby publishers would sell titles directly to the public as opposed to the “wholesale” model, in which electronic books were sold to retailers. Agreements between Apple and the publishers were in place ahead of the 2010 launch of the iPad.

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