U.S. Files Suit Against Apple, Five Major Publishers for E-Book Price Hikes

By

Wall Street Journal reported that on Wednesday, the United States Justice Department accused iPad maker Apple Inc., and five of the nation's largest publishers, of conspiring to raise e-book prices. Five defendants include Hachette Book Group, Schuster Inc., HarperCollins Publishers, Macmillan and Penguin Group (USA).

This is a case that could radically reorder the fast-growing business, according to WSJ reporters Thomas Catan, Jeffrey A. Trachtenberg and Chad Bray.

In this price fixing lawsuit, according to WSJ, the U.S. alleges the publishers’ chiefs met secretly in upscale Manhattan restaurants to hatch a plan to respond to the sharp discounting of their e-books by Amazon.com. “The executives also called and emailed each other to craft a solution to what one of them called ‘the wretched $9.99 price point,’” the source said.

In fact, according to the U.S. antitrust suit, “Apple and the five publishers hatched an arrangement that lifted the price of many best-selling e-books to $12.99 or $14.99,” wrote Catan, Trachtenberg and Bray.

"As a result of this alleged conspiracy,” quoted the WSJ report quotes attorney general Eric Holder, “we believe that consumers paid millions of dollars more for some of the most popular titles."

The publishers and Apple, however, have both denied any wrongdoing and said the government's actions could harm consumers by giving Amazon more control.

In the meantime, the report indicates that three of the five publishers have agreed for a settlement with the Justice Department, whereby they allow Amazon and other retailers to continue to discount of e-books. “Settlement of a separate suit filed by 16 states and U.S. territories could lead to tens of millions of dollars in restitution to consumers who bought e-books at the higher prices,” said WSJ.

Amazon has considered this settlement a victory for consumers and promised to renew discounting. The report suggests Amazon’s decision to continue discounting e-books will put pressure on rivals like Barnes & Noble, Inc.

However, Apple and two other publishers – Macmillan and Pearson PLC's Penguin Group (USA) – have rejected the government’s offer and are ready to fight in the court.




Edited by Braden Becker
Get stories like this delivered straight to your inbox. [Free eNews Subscription]

TechZone360 Contributor

SHARE THIS ARTICLE
Related Articles

Shabodi Accelerates Adoption of Network-Aware Applications with CAMARA API Enterprise Reference Implementation

By: Special Guest    2/16/2024

Shabodi, an Application Enablement Platform (AEP) provider unleashing advanced network capabilities in LTE, 5G, 6G, and Wi-Fi 6, announced they have l…

Read More

How Much Does Endpoint Protection Cost? Comparing 3 Popular Solutions

By: Contributing Writer    2/2/2024

Endpoint protection, also known as endpoint security, is a cybersecurity approach focused on defending computers, mobile devices, servers, and other e…

Read More

What Is Databricks? Simplifying Your Data Transformation

By: Contributing Writer    2/2/2024

Databricks is an innovative data analytics platform designed to simplify the process of building big data and artificial intelligence (AI) solutions. …

Read More

What Is Blue/Green deployment?

By: Contributing Writer    1/17/2024

Blue/green deployment is a software release management strategy that aims to reduce downtime and risk by running two identical production environments…

Read More

The Threat of Lateral Movement and 5 Ways to Prevent It

By: Contributing Writer    1/17/2024

Lateral movement is a term used in cybersecurity to describe the techniques that cyber attackers use to progressively move through a network in search…

Read More