“Apple and four major publishers have offered to allow retailers such as Amazon to sell e-books at a discount for two years in a bid to end an EU antitrust investigation and stave off possible fines, a person familiar with the matter said on Friday,” Foo Yun Chee reports for Reuters. “The EU antitrust watchdog opened an investigation into Apple’s e-book pricing deals with the publishers last December, saying these may hamper competition in Europe.”
“The four publishers are Simon & Schuster, News Corp unit HarperCollins, French group Lagardere SCA’s Hachette Livre and Verlagsgruppe Georg von Holtzbrinck, which owns Macmillan in Germany,” Chee reports. “The Commission said [that] in April the five companies had offered concessions in a bid to end the investigation and avert penalties which could reach 10 percent of their global turnover, but it did not give details. Pearson Plc’s Penguin group, which is also being investigated, was not mentioned among those submitting proposals.”
Chee reports, “The Commission was now sounding out opinions from the industry as to whether the concessions are sufficient, the person familiar with the matter said, before a formal market test which could lead to the investigation being dropped… The proposals are similar to the ones reached in a settlement in April of a price-fixing lawsuit brought by the U.S. government against HarperCollins, Simon & Schuster and Hachette, which also had sales deals with Apple.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
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DOJ and government depend on fear and excessive punishing fines to get their way, even when dead wrong. A dangerous trend. Amazing this has gone on this long without Obama pulling back his Holder dogs.
Well, since this article was about the EU, your comment is less than useless.
It mentioned the US case, which is still ongoing. It’s an entirely relevant comment.
My apologies. That was an unnecessarily harsh reply. Bad morning, but that’s no excuse.
Yeah, at a recent barbecue my recently graduated nephew told me he was thinking of getting into organized crime, to which I replied “private sector or public sector?”
/i/h
“The Commission was now sounding out opinions from the industry as to whether the concessions are sufficient”
They mean DOJ’s Eric Holder is asking Amazon’s Jeff Bezos.
So as a publisher, manufacturer, developer or other general maker of goods don’t you have the right to choose where and to whom you sell what you make? You want to send a message to Amazon ( or any other retailer you don’t agree with) then don’t sell to them.
Free market, as a consumer if you don’t like the price or deal then you don’t buy or sell it.
If enough publishers don’t like the terms they get from one outlet then don’t sell to them. When that outlets sources dry up they will complain but at the end of the day you don’t have to sell to them. In this case let the market decide. They will change their tune if their shelves are empty. The ironic thing is that the outlets will make more under the agency model, better balance n everyone’s good.
Same works for the publishers, manufactures, et al; price it too high and it won’t sell. Again free market.
Works great if you don’t monkey with it.
But then that’s who’s forcing everyone’s hand…. A bunch of monkeys.
The problem is that the publishers supposedly colluded on pricing. That’s not a free market. And Apple apparently demanded that the publishers agree that no one could sell ebooks for a lower price than Apple could. Again, that’s artificially reducing competition and mucking about with the free market.
To specifically answer your question, yes, of course you have a choice regarding who to sell to. The problem comes in when you collaborate with other sources of the same products to artificially raise prices.
Or are you saying that Microsoft’s past policies of requiring any OEM to pay for a Windows license for all PC’s they built in order to get discounted Windows licensing was perfectly fine? I seem to recall a *lot* of complaining about that a few years ago. And that issue only involved a single source supplier being very aggressive with their OEM agreements, not a number of suppliers colluding on pricing.
You might have a point, if not for the fact that plenty of ebooks are available for as little as a dollar or so, and many for free. The Agency model was no different to that followed by publishers selling dead tree books, and Apple were taking 40% less than Amazon were; Amazon basically had the market totally stitched-up to their overwhelming advantage, Apple broke that monopoly, and now governments want to hand that monopoly back to Amazon. Makes you wonder what back-handlers Amazon are paying out to get these legal reviews.
As a maker of goods you have the right to set what ever terms you want…. As a buyer or retailer of goods you have a right NOT to buy said goods if you don’t like the terms.
In this case Apple was not the only place to sell to, it just had better more attractive terms.
All industries collude on pricing in one form or another, I know I’ve seen in first hand, been in the room so to speak. It is either a direct thing or by one maker of goods underpricing and outperforming the others forcing the hand of their rivals. A lot of frienemy deals take place in every major industry.
The real meat here is that it’s the maker of goods that drives the supply chain….. Without them there would be no retail. In this time of instant Internet gratification they could just sell directly rather than the older models that greatly favor the retailer over the supplier.
A fair balance makes it work, the older retail model that Amazon is abusing does not work. This model tells the maker of goods what they will get paid regardless of what they need to survive and thrive.
It still dumbfounds me how the government can go after book sellers for these practices (books are not essential to every day life), yet they let the Oil and Gas cartels get away with this type of thing every day for ever.
ABSOLUTE *DING* FACTOR!
Darn, the publishing industry didn’t through $MILLIONS in campaign contributions (GRAFT) at the politicians. No kickbacks to you!
Then add the fact that this entire subject makes NO sense. It actually KILLS competition. It does NOT enhance it. Therefore, it’s plain insane. Well done, PoliTards.