Linked by Thom Holwerda on Fri 2nd Aug 2013 15:30 UTC
Apple Inc deserves a five-year ban from entering anti-competitive e-book distribution contracts and should end its business arrangements with five major publishers with which it conspired to raise e-book prices, federal and state regulators said on Friday.

The U.S. Department of Justice and 33 U.S. states and territories proposed those changes after U.S. District Judge Denise Cote in Manhattan last month found in a civil antitrust case that Apple played a "central role" in a conspiracy with the publishers to raise e-book prices.

The DoJ also requires that competitors such as Amazon and Barnes & Noble be allowed to include links to their own stores in their iOS applications, which Apple had prohibited.

Permalink for comment 568779
To read all comments associated with this story, please click here.
RE: Everyone is wrong
by TM99 on Sat 3rd Aug 2013 07:39 UTC in reply to "Everyone is wrong"
Member since:

Apple alone is 'wrong', as you correctly have written.

However, Amazon in this case is not in the wrong. They have not violated anti-trust laws because selling below cost an item they paid for wholesale and did not themselves produce is not dumping. You might believe it is, but legally and economically it is not so.

Amazon follows the 'wholesale' model. Apple colluded with publishers to push the 'agency' model. There is a huge difference.

This article explains why Amazon is NOT putting other online sellers of eBooks out of business.

Your points on the DOJ are also wrong. I mean, even reading a basic Wikipedia summary on monopolies and anti-trust will show you exactly why Amazon is NOT in trouble legally with the government and Apple IS.

It had nothing to do with Apple being a big player. They broke the law. Amazon has not done so. Volumetric pricing is illegal under Robinson-Patman. Amazon was selling the ebooks for a loss to get to a $9.99 price point. Amazon can bend the Robinson-Patman rules by asking for a larger co-op which is what they have been doing. That larger co-op has to be offered to all other retailers which it has been. Therefore, under current wholesale agreements, it is ultimately up to the publisher to decide whether to offer content at a specific price. And once they offer it to Amazon at that price, then they have to honor it for all direct accounts. It will be the publishers then who bend the rules. What Apple and those publishers did, as outlined in the above links and the court documents, is beyond bending the rules. It was a full blown violation of the laws as they stand.

Now if Amazon uses predatory pricing to gain unfair market advantage, and then subsequently raises the cost, excessively, to consumers, then and only then will they have violated the law in the same fashion as Apple & those publishers did.

Your thesis falls into the false equivalency meme when the actual facts are elucidated as I have now shared. Sorry.

Reply Parent Score: 5