“The Justice Department has warned Apple Inc. and five of the biggest U.S. publishers that it plans to sue them for allegedly colluding to raise the price of electronic books, according to people familiar with the matter,” Thomas Catan And Jeffrey A. Trachtenberg report for The Wall Street Journal. “Several of the parties have held talks to settle the antitrust case and head off a potentially damaging court battle, these people said. If successful, such a settlement could have wide-ranging repercussions for the industry, potentially leading to cheaper e-books for consumers. However, not every publisher is in settlement discussions.”
Catan and Trachtenberg report, “The five publishers facing a potential suit are CBS Corp.’s Simon & Schuster Inc.; Lagardere SCA’s Hachette Book Group; Pearson PLC’s Penguin Group (USA); Macmillan, a unit of Verlagsgruppe Georg von Holtzbrinck GmbH; and HarperCollins Publishers Inc., a unit of News Corp., which also owns The Wall Street Journal.”
“The case centers on Apple’s move to change the way that publishers charged for e-books as it prepared to introduce its first iPad in early 2010,” Catan and Trachtenberg report. “As Apple prepared to introduce its first iPad, the late Steve Jobs, then its chief executive, suggested moving [from the ‘wholesale model’] to an ‘agency model,’ under which the publishers would set the price of the book and Apple would take a 30% cut. Apple also stipulated that publishers couldn’t let rival retailers sell the same book at a lower price… The Justice Department believes that Apple and the publishers acted in concert to raise prices across the industry, and is prepared to sue them for violating federal antitrust laws, the people familiar with the matter said.”
Much more in the full article here.
[Thanks to MacDailyNews Reader “Jack Frederick” for the heads up.]
Class-action lawsuit alleges Apple, publishers engaged in ‘price-fixing conspiracy’ to punish Amazon – January 21, 2012
U.S. Justice Department confirms antitrust probe of Apple iBookstore, publishers, e-book industry – December 7, 2011
EU investigates Apple over ‘anti-competitive’ practices in e-book market – December 6, 2011