Last week, the Justice Department sued in United States District Court in New York, charging that Apple, Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster had colluded to fix e-book prices. (Hachette, Simon & Schuster and HarperCollins have already agreed to settle.)
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Amazon Low Prices Disguise a High Cost - NYTimes.com
- Under the wholesale arrangement with Amazon, the publishers received half of the list price, which yielded better money, but gave them no control over the pricing of their product. With the introduction of the iPad, publishers got a crack at remaking their deal because Apple allowed them to set the price and then took a cut of 30 percent.
- As low-margin companies trapped in a declining business with fewer outlets, book publishers face an existential threat. “If we are fixing prices for our benefit, we don’t seem to be very good at it,” said one publishing executive mordantly. (He declined to be named criticizing the lawsuit because of his involvement in the settlement.)
- Only after agency pricing went into effect was Barnes & Noble able to gain an impressive 27 percent of the e-book market.
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Robert F. Levine, a lawyer with an extensive practice in publishing, said there’s a practical reason for all that uniformity. The book business is both hermetic and dwindling. “There is not a drop of new capital coming into this business,” he said. “The margins are low and there is almost no growth, so you end up with a rather small industry, with a handful of companies and a handful of players.”
Posted April 15, 2012 at 9:15pm in books ebook amazon apple doj antitrust price fixing kindle monopoly consumerism
