Court documents reveal Steve Jobs email pushing e-book agency model; 17 more states join class action suit

“New York, the District of Columbia and fifteen other states have joined the e-book pricing class action suit against Apple, Macmillan and Penguin, bringing the total number of states involved so far to 31 (if you include DC and Puerto Rico),” Laura Hazard Owen reports for paidContent. “The amended complaint, released Friday, reveals details that were previously redacted, including an e-mail from Steve Jobs.”

Owen reports, “In late January 2010, Steve Jobs became directly involved in the agency pricing negotiations ‘after Eddy Cue could not secure one of the Conspiring Publisher’s commitment directly from an executive.’ Jobs ‘wrote to an executive at the parent company, in part:'”

As I see it, [Conspiring Publisher] has the following choices:

1. Throw in with Apple and see if we can all make a go of this to create a real mainstream ebooks market at $12.99 and $14.99.

2. Keep going with Amazon at $9.99. You will make a bit more money in the short term, but in the medium term Amazon will tell you they will be paying you 70% of $9.99. They have shareholders too.

3. Hold back your books from Amazon. Without a way for customers to buy your ebooks, they will steal them. This will be the start of piracy and once started, there will be no stopping it. Trust me, I’ve seen this happen with my own eyes.

Maybe I’m missing something, but I don’t see any other alternatives. Do you?

Read more in the full article here.

MacDailyNews Take: This is one of the stupidest lawsuits ever.

Related articles:
Apple vs. Amazon: Who’s really fixing eBook prices? – April 17, 2012
Apple: U.S. DOJ’s accusation of collusion against iBookstore is simply not true – April 12, 2012
Apple not likely to be a loser in legal fight over eBooks – April 12, 2012
16 U.S. states join DOJ’s eBook antitrust action against Apple, publishers – April 12, 2012
Australian gov’t considers suing Apple, five major publishers over eBook pricing – April 12, 2012
DOJ’s panties in a bunch over Apple and eBooks, but what about Amazon? – April 12, 2012
Antitrust experts: Apple likely to beat U.S. DOJ, win its eBook lawsuit – April 12, 2012
Why the market shrugged off the Apple antitrust suit – April 11, 2012
What’s wrong with the U.S. DOJ? – April 11, 2012
Macmillan CEO blasts U.S. DOJ; gov’t on verge of killing real competition for appearance of competition – April 11, 2012
U.S. DOJ hits Apple,major publishers with antitrust lawsuit, alleges collusion on eBook prices – April 11, 2012
U.S. DOJ may sue Apple over ebook price-fixing as early as today, sources say – April 11, 2012


      1. Both point could be easily argued.
        For the first one, you only have took at the landing page to see exactly how much time is wasted on stupidity. Truth is most site would be pretty bare if not for big supplies of the stuff. Not trying to criticize or belittle (love the site and spend way too much time on it) just pointing out reality.

        To the second point, when a group of folks get together with the purpose of setting a common price point for a common product, so that no one has an advantage over anyone else, that is the definition of price fixing.

      2. Agree, the referenced article shows a chart with ebook prices ranging from 9.99 to 19.99 depending on the hardcover price. Publishers could freely choose the price of their hardcovers, and that would set the ebook price.

    1. Hey Mini… since when did you become a lawyer? Price fixing only comes around when no other publishers are in existence… not when you have so many publishers to complete.

    2. So a car dealer gets a car with a sticker price on it, and a book dealer (Apple) gets a book with a sticker price on it. That’s known as MSRP. The dealers take a commission on the sale based on the actual selling price. Both the car manufacturer and the book publisher are free to set any MSRP they like, but they can’t set it too far below or above the competition. If they do, either they don’t make any profit or don’t sell anything. In any case, Apple has nothing to do with setting the price of the books it sells.

  1. ::sigh:: Setting a pricing model that reflects MSRP is not price fixing, you have to take these things in context. Amazon wants to publishers to take a hit on margin and hopefully (make it up on volume, WalMart style). Much like WalMart this only benefits the retailer. Just like any discussion of anti-trust, people think reading a couple articles somehow makes them lawyers.

    This whole notion comes from the idea that we pay for form factor and not content, and somehow digital distribution has to be massively discounted or it’s anti-consumer. I like lower prices but I also know enough to understand digital distribution is not free.

  2. I can’t help but wonder…since when did every state in the country care about books? Or the price of anything at all? I understand all the arguments about price-fixing, but really, considering all that this nation has going on: they have time and energy to pursue this? Something tells me that it is just a bunch of cash-strapped states with their eyes on Apple’s bank balance, and an expectation that they are going to be able to dip into it.

      1. I’m guessing by the Yankees logo, you are a New Yorker..

        This may come as a shocker to you: New York Trails Arkansas in adult literacy rates. And it isn’t improving..

        2/3 of NY Public School kids are below grade level in language arts/english.

  3. How is Apple providing an alternative marketplace to Amazon, in which publishers can sell their books at the prevailing paperback price, construed as price fixing? Don’t Apple and Amazon have to collude for price fixing to occur?

    1. You would think so.

      Apple and Anazon would have to deal directly to fix prices in the RETAIL rebook market (which they clearly didn’t — their actions actually demonstrate fierce competition in that market).

      In the WHOLESALE ebook market, if the book publishers got in a room together and said $12.99 and $14.99 were THE prices, that does sound fishy to me. Jobs gave them a legitimate too (the agency model), and it looks like the publishers abused it.

  4. Uncortunately, with these emails, Jobs handed the SOB’s at DOJ and their state counterparts the keys to the vault so they could loot Apple’s hard-earned savings. Even if Jobs wasn’t “really” engaging in price fixing, his own emails sure make it SOUND like they were, and even that Apple was the instigator of the whole thing. Unless there is incredibly strong countervailing evidence that hasn’t yet emerged, Apple should just try to settle. If the current DOJ leadership is unreasonable, maybe they’ll get lucky and get a whole new team over there after the election. This looks bad, bad, bad…

  5. So when Apple offers the exact same agency model to app developers… IS THAT ALSO PRICE FIXING?

    I sure hope Apple is taking this all the way to the Supreme Court, to find out if a free market still exists in US, or if he fascist currupt burocrats have taken over so can can dictate an Amazon monopoly.


  6. Some of those states hardly have a literacy rate to justify having books of any sort. It must be an effort to drive more authors out of the business by making sure that they can never make a living by writing.

  7. 17 more GREEDY States that can’t make it on their own, so they go for the easy money grab. How sad. I know they can’t but only can wish Apple could CHOKE OFF the sales tax they generate for those states thru the Apple Stores. (MacMall style) What a bunch of ingrates.

  8. To me it looks like the meaning of the email is being taken out of context.
    Only the first part is being looked at and everyone is concluding price fixing was going on.

    SJ was outlining the options that the publishers had at the time and trying to convince them the agency model was the best way to go.

    1. Try to make a go at the agency model at say 12.99 – 14.99 a book.

    2. Continue to hand all the power to Amazon, which they would regret later.

    3. Cut Amazon off and surrender to piracy.

    I know what option sounds the best to me.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.