Apple accuses DOJ of unfairly twisting Steve Jobs’ words in e-book case

“Steve Jobs figures prominently in the U.S. Department of Justice’s e-book price fixing case against Apple,” John Paczkowski reports for AllThingsD. “His email messages to other executives at Apple and in the publishing industry, and his comments to biographer Walter Isaacson and others, have been gathered up by the agency and offered up as proof of a conspiracy in which he was allegedly ‘the chief ringmaster.'”

“How does Apple rebut such accusations when Jobs is no longer around to help in mounting a defense by explaining those remarks himself?” Paczkowski reports. “By casting the government’s use of Jobs’s remarks as untoward and shady. And in his opening argument on Monday, Apple attorney Orin Snyder did exactly that, questioning the fairness of even using them as evidence, and lambasting the government for purposely taking Jobs’s remarks out of context.”

Paczkowski reports, “So, in Apple’s eyes, not only is the DOJ cherry-picking Jobs’s remarks for maximum effect, it’s spinning them as something that they really aren’t. How do we know that? Because, according to Snyder, Jobs would never have been so foolish as make such potentially damning comments publicly.”

Read more in the full article here.

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49 Comments

    1. The original Twisters are these political idiots.
      They can’t help but believe everyone does it because for politicians the twisting habit is so ingrained it’s like breathing.

  1. It’s become pretty clear that this administration is for sale to the highest bidders (Amazon and Google). It’s time for Eric Holder and the rest to go. This is smelling more and more like the Nixon administration.

    1. “This is smelling more and more like the Nixon administration.”

      -Oh brother. Please review your history and read carefully what exactly went on during the Nixon administration. It doesn’t compare – I am so tired of chants of Hitler!, Communism!, Nixon!, etc. It’s like, if we say it enough, people will believe it.

      This administration is no more corrupt than the previous 4 or 5 administrations.

      It is become apparent to me (and I think most people) that government in general “is for sale to the highest bidder.” The recent Citizen’s United decision has only made it worse.

      I like MDN’s idea of term limits for all politicians.

      1. I don’t need to read historical accounts of the Nixon administration. I was in law school during the Nixon administration. I heard detailed lectures from law school professors about exactly how that administration was operating outside the law by stonewalling, invoking executive privilege, abusing its power, and just plain lying. Yes, the big messy Watergate caper was the primary, visible, and best known transgression. But there were enemies lists, IRS manipulation, and political favors long before the huge smoking gun provoked Nixon’s resignation.

    2. It’s not “the Obama administration”, it’s the whole lot of them. From domestic wire tapping and NSA data mining, to killing citizens with drones and going after Wikileaks, in a lot of ways things are much worse than the Nixon administration (and now it’s not front-page news, it’s business as usual).

    1. “Btw, you fanboys bore me with your blind devotion.”

      Yep, unlike you, whose allegiances come and go with the trend-winds, eh sf? Speaking of coming and going, isn’t it time for your morning toss-off?

  2. But of course he wasn’taking those comments publicly, they were in internal emails he never would have thought would be read on the outside…

  3. Apple grasping at straws.

    There is no twisting. Steve Jobs said Amazon’s prices would be the same as theirs. Simon and Schuster called him stupid for making those statements.

    Emails from Steve Jobs saying they’re fixing prices at $12.99 and $14.99. Steve Jobs saying that the big publishers must move Amazon over to the agency model too. Steve Jobs saying they’re inflating prices by saying that the customer will pay more but that’s what you want anyway.

    Dialogue showing HaperCollins didn’t want to lock in eBook prices without any flexibility to sell for a different price anywhere else. Penguin CEO saying Apple was the ring leader in collusion. On and on.

    No twisting. The only thing that twists anything is delusional thinking.

    This is what you people would have had if Apple had its way.

    Books from these big publishers would be 30%+ higher around the world. So you’d be paying an average of 30%+ more for many popular titles. And you wouldn’t have a choice. Ever. That is not good for you/the industry. It is anti-competitive.

    1. I only read your posts that appear to have meat in them. If you’d lose the holier-than-thou attitude you might actually achieve your objective of bringing a little balance.

      So I’ll ignore the attitude in this post and offer some counter points:

      1) The CEO of Penguin can and will say whatever he wants, but that doesn’t make it so, not any more so than Apple CEO saying otherwise.

      2) It’s actually a fairly long established practice among manufacturers to enter into agreements with their resellers that don’t allow them to sell their product at below MSRP. I know that’s not exactly what’s at issue in this case, but it is tangential to the agency model Steve/Apple has created for their online stores.

      3) This is a US DoJ case, so concerns about world pricing and situation are out of their jurisdiction. I think you’ve said you’re not a US citizen (or else are but not living in the US) so I can understand why that “30%+” concern would be yours, but in this US case, and to this US citizen, it isn’t. What I hope Apple is able to show is that Amazon’s buying power was being used to force publishers to sell below commercially viable pricing and profit margins, because that would move the tone from “price fixing (at higher prices)” to “undercutting monopoly power.”

      1. Well said, Jim: this lawsuit really is about the Monopoly Power that Amazon was wielding … and it shouldn’t be too surprising that the book publishers who are still dependent on Amazon have decided to cut their losses and bail.

        If Apple can reach into the Steve Jobs bag of old emails and pull out ones that say “Amazon Monopoly”, the DOJ is going to have to defend against not pursuing evidence of a Monopoly Abuse. That’s really what the stakes are in this game.

        -hh

      2. “1) The CEO of Penguin can and will say whatever he wants, but that doesn’t make it so, not any more so than Apple CEO saying otherwise.”

        There is not saying anything. The evidence is right here. Denying it is delusional. All of it is in writing. Apple colluded. Do you understand? They colluded with the world’s largest publishers. There is no denying it unless you’re delusional. Penguin has nothing really to gain they’ve already settled and been fined. Penguin is just icing on the cake. There is a pile of evidence if you wish to read through it. I read the 187 page document Apple filed along with many other things. There is a lot of evidence against Apple. If there wasn’t all this evidence, I wouldn’t really be saying Apple is to blame. But there is.

        “2) It’s actually a fairly long established practice among manufacturers to enter into agreements with their resellers that don’t allow them to sell their product at below MSRP. I know that’s not exactly what’s at issue in this case, but it is tangential to the agency model Steve/Apple has created for their online stores.”

        Apple COLLUDED. Having a contract with each vendor is one thing. Apple got the world’s largest publishers in a room. ALL OF THEM. And they all worked together to fix and inflate eBook prices across the entire industry. This is the main difference between dealing with a contract on a vendor by vendor basis, and collusion. The collusion bit is that they fixed prices and the way they tried to do it was that they worked together. The net result of their actions was to stymie competition.

        On your point 3… what are you talking about? Let me do this again.

        Under Apple’s world, everyone in the world. Everyone, including you and other Americans if you are American, would be paying 30%+ higher prices because of Apple’s inflation titles by the world’s largest publishers. You would not have any choice. No competition because the publishers weren’t allowed to sell anywhere else for less than the iBookstore, or even more than the iBookstore! It’s fucking blatant price fixing and price inflation. Apple fixed the price at $12.99 and $14.99: you can’t sell for higher or lower!

        Apple was wrong to do this. I’m not saying they should get a huge fine, but they should be punished. If this were Amazon, you would be screaming at them.

        “Emails emerge from Jeff Bezos showing that he mobilized the world’s largest publishers. In Emails, Jeff stated that he wanted fixed pricing at $12.99 and $14.99, and that the books could not be sold for less anywhere else in the world. Penguin CEO said Amazon was the ring leader. Jeff Bezos was on TV and said that Apple’s prices would be the same as Amazon’s. Walt Mossberg asked Jeff why someone would want to pay higher prices for eBooks when they’re much cheaper on the iBookstore. Jeff replied, ‘Apple’s prices will be the same.'”

        Fuck Amazon! Those evil bastards! Trying to raise prices of eBooks!

        Are you beginning to understand how delusional you people are?

        I’m not saying I like Amazon much better. There’s problems there too. I agree. But that doesn’t excuse what Apple did here. Not at all. This is about Apple.

        1. I won’t go through answering all your fantasies as I’ve blown them up before. (Yelling ‘collusion, collusion’ etc don’t make it real.

          here I’ll address a few other things:
          “Penguin has nothing really to gain they’ve already settled and been fined”

          I’m not saying Penguin CEO is lying but if you think about it there’s plenty to gain, e.g:

          1) to keep on the good books with Amazon. Amazon has shown that it can be ruthless to those who challenge it’s book retailing primacy. Buy buttons can mysteriously disappear, publishers can be blacklisted or search results don’t pull up their titles. Controlling the vast bulk of paper book sales and 80-90 % of ebooks it’s the MONOPOLY which nobody except Jobs had the gall to challenge.

          You wonder why the DOJ doesn’t investigate Amazon’s monopolistic practices? It’s like a 100 years ago the DOJ goes after other oil producers to protect Standard Oil.

          Could it be that Apple does almost zero lobbying and Washington is sending a message for apple to pay it’s dues? The Beltway shakedown (hey the politicos don’t want apple to start a trend). Google pays 9 times apple in lobbying.

          2) the Penguin CEO needs to explain to SHAREHOLDERS why the heck it had to pay millions in fines. Excuse: BLAME APPLE and get off the hook.

          I think of many other reasons why the CEO of Penguin will want to wriggle out of responsibility.
          another thing Publishers were already talking about amazon’s unfair practices before iPad was even out.

          Another Item of your Fallacious thinking:
          here’s another idea from another one of your posts:
          “They didn’t want books selling for less because they’d have to compete with Amazon’s loss leaders and Apple’s wants a profit margin on everything”

          Anybody who knows even a little about apple (and you claim to be a an ‘expert’ reading 187 pages etc of apple’s disposition etc) KNOWS that for YEARS APPLE RAN ITUNES AT A BREAK EVEN (it didn’t try to make a ‘profit on everything).
          for years if you read the financials iTunes didnt make any real money.
          (this shows that your self proclaimed expertise and facts is the thing which is really ‘delusional’. )

        2. “The collusion bit is that they fixed prices and the way they tried to do it was that they worked together. The net result of their actions was to stymie competition.”

          Stymie competition?!?

          You can’t be serious. Stymied for HIGHER prices to negate Amazon lower prices? Wow. LOL!

          Following your lack of common sense logic, so Apple and the big five pubs ‘colluded’ to set EVIL HIGHER prices for more BIG BUSINESS PROFIT than Amazon for the same item, everyday. Guess all price shoppers are clueless and fell head first into their wallets to pay more for the same thing.

          Apple offered a book business agency pricing model that is flexible, fair and rewards publishers to recoup their investment that run a WIDE range of production COSTS (think paperback versus coffee table picture books).

          Your so called nefarious ‘collusion’ is more a DIRECT BENEFIT business advantage for Amazon and its consumers.

          I did not know Amazon is the omnipresent arbiter of e-book pricing structures worldwide and everyone outside of their business model is BREAKING the law?

          Ridiculous. Free trade be damned.

          Saying legions of savvy shopping consumers are thereby too stupid to shop for lower prices at Amazon and forced flocked in droves to Apple selling the same product at higher prices to enrich the offshore tax haven coffers?

          Shallow as a bird bath.

          Say hello to your opposition research team for me and hope their bonus FUD checks reach an all-time high …

    2. Read the actual, complete email. Jobs, when not taken out of context, was stating that Apple would not be interested in a deal if the retail pricing in Apple’s book store set by the publishers would be more than the stated prices. They’d be free to set lower prices in the Apple book store as long as Apple got its 30% commission. The other requirement was that the publishers could not set a lower price for the same book on another service. This was not price fixing as they’d be free to lower their price on Apple’s book store to match prices they wanted to charge for the same book elsewhere.

      There was no price fixing going on here except in the cherry picked, out of context, highly spun rhetoric of the DOJ. IF Apple had colluded with Amazon to fix prices they might have case.

      1. Nope.

        Apple wanted to fix prices at $12.99 and $14.99 to break Amazon’s grip on cheaper prices. They didn’t want books selling for less because they’d have to compete with Amazon’s loss leaders and Apple’s wants a profit margin on everything. So they worked to lock publishers into an inflated price which would allow them to get more money. Jobs also said, paraphrasing, “Customers will pay more but that’s what [the publishers] want anyway.”

        Jobs was clear on $12.99 and $14.99. That was the fixed price. And Walt Mossberg challenged him on it, and he simply replied that Amazon’s prices would end up being the same.

        Wake up Zeke.

        1. Actually no. The $12.99 and $14.99 were suggested tiers and maximum prices above which Jobs knew/felt the market would not buy.

          At the iBooks store publishers are free to set any price they wish, and Apple gets 30% (just like developers at the App store).

          At the end of the day that’s a fact. Any publisher, and any developer, can set their own price in Apple’s stores (including free).

          1. Wrong. Apple colluded to fix prices at $12.99 and $14.99.

            “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.”

            The Emails we’re seeing are just scratching the surface. The Attorney General’s Office has a lot of other evidence that will end up being in the public record sometime in June.

            So you got that honky tonk? $12.99 and $14.99. Not $9.99. Not $10.99. $12.99 and $14.99.

            Steve Jobs and Apple did NOT want cheaper prices on their store. If they did, they wouldn’t have done this. They would have just competed against Amazon at lower prices and a better reading experience.

            You got that? Price fixing. That’s what they did. Price inflation and price fixing. It’s why they COLLUDED with the Big 6 publishers to lock them into making “a go at $12.99 and $14.99” forcing the whole industry to adopt these prices.

            Wake the fuck up.

            1. From Apple’s perspective the CONTRACT is all that matters. Apple ceded control over pricing to the publishers (as with the App Store). Under the CONTRACT Apple had no control, no leverage, no mechanism, to set the prices consumers pay.

              Book publishers are free to set book prices from $0 to infinity. That was true then, and it’s true now. (There was a stipulation that they don’t under-cut the iBooks prices via other retail outlets, but that’s legally just fine).

              Now the publishers? They may in fact have colluded to raise prices. But if the retailer (Apple) is not setting prices, it can’t very well raise prices, can it?

              Remember Apple was not a monopoly in this market. In fact at the time of these negotiations Apple had zero market share in ebooks, against an monopolistic competitor with 90% of the market (remember Amazon had already abusively squeezed out almost all competition).

              How is Apple the bad guy here?

            2. Also, you have to look at motive. Apple’s interest is in having CHEAPER media.

              Apple benefits by having a competitive but CHEAPER source of media for their iPad customers.

              They have virtually no incentive to increase prices, but a huge incentive to make sure there is a wide range of products available at a cheap price.

              It’s crystal clear to anyone who looks at the business context of this that Steve’s comments about prices going up was just stating a truth, not voicing his desire.

        2. Wake up, yourself. Are you incapable of researching and reading the original email in its entirety? Silly question, actually. Of course you are. Otherwise you wouldn’t be making such a fool of yourself.

        3. sfgh, hoping I can help you out a bit. you are having trouble getting through because you are a dick. try making your point with a bit of humility and a few source links.

        4. Amazon had no “loss leaders” which are specific items to draw customers into a store with hopes they buy something else while in the store. All of Amazon’s e-books were sold at predatory pricing! That is what Amazon, with 90% of e-book retailing was doing; selling e-books below cost so that other e-book retailers COULD NOT COMPETE OR ENTER THE MARKET! That is illegal predatory pricing and is a monopolistic practice when done by someone with economic control of a market. . . which Amazon would be deemed to have at 90% of the e-book market! But, it was not a defined economic market at the time. Apparently, now that Apple, a still minority player, is in the market, it is. . . and DOJ elects to go after them on a complaint filed by the real monopolist. Amazon. amazing…

          1. This is exactly the heart of the issue.

            Amazon somehow got the government to go after a new entrant into the market, when they had been an abusive monopolist in that market for years.

    3. The emails do not say they are FIXING prices at $12.99 or $14.99. They suggest that is the maximum. The “prices” could have been as low as FREE. There is absolutely no email trail, paper trail or even any conversation where Apple set an absolute minimum price for any books.

      The agency model argument is 100% BS. The final agreements state clearly that the PUBLISHERS set the selling prices, not Apple. So, as the contracts clearly state, Apple gave up ALL control over pricing, how is Apple the ringleader in raising prices?

      As far as Jobs stating that the PUBLISHERS wanted to raise prices, that is just Jobs stating fact. The PUBLISHERS did want to raise prices. Jobs was not telling them that the HAD to raise prices. Jobs was not saying that all the publishers HAD to work together to raise prices. Jobs was not saying (and the final contracts do not require) that the publishers raise prices.

      The final contracts do allow the publishers to authorize different retailers to have different retail prices. The only constraint was the “best customer” clause. The contracts require that if the publishers allow a retailer to sell the book at a certain price that Apple, under ALL circumstances,would be allowed to match that price. Apple’s customers were always guaranteed never to be at a price disadvantage. Apple’s customers were never guaranteed to have a better price than anyone else. Non Apple customers were NOT required to pay more than Apple customers.

      Simply put, if the publishers allowed Amazon or B&N to give their books away for free then the publishers had to allow Apple to give the same books away for free too!

      There never was, and in the current contracts is not, any “price lock in”.

      Penguin’s CEO is making statements after the fact. He just wants the issue to be pointed at anyone but him and Apple is an excellent place to point since the DOJ is already point there. What, you thought he’d actually say, “We hated what Amazon was doing, and we {all of us publishers] were looking for any viable means to take Amazon down a notch. Apple was just the perfect foil for us to do that.” If you think he’d ever say that, you’re even more delusional than I think you are.

      As to the 30% higher argument, it’s 100% BS. Apple takes 30% of whatever price the publishers set. The publisher gets 70%. In the classical model, the publisher sells the book to the retailer at 50% OR LESS of the suggested retail price. If the retailer sells it at MSRP the publisher gets 50% (or less), the retailer gets 50% (or more). Thus the publishers would typically get more money for the same sale at MSRP.. If the publishers wanted the same income then they could actually LOWER the authorized retail prices of the books. The PUBLISHERS had the control. They could keep the MSRP the same or higher and make more money or THEY could lower the prices and make the same money. Other than Apple getting the 30% fraction of the retail price, Apple has absolutely ZERO control over this. The PUBLISHERS have absolute control. So, where is Apple doing the price fixing — or raising prices?

      You can claim that your perspective is correct. However, it is not based upon reality or any of the facts!

      1. Oh god another one. Here we go.

        Steve Jobs said:

        “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.”

        You said:

        “The emails do not say they are FIXING prices at $12.99 or $14.99. They suggest that is the maximum. The “prices” could have been as low as FREE. There is absolutely no email trail, paper trail or even any conversation where Apple set an absolute minimum price for any books.”

        Fuck are you people delusional. There’s Steve Jobs saying, in ink, that he wants to create a $12.99 and $14.99 eBook market yet you say it’s not price fixing or price inflation. What the fuck do you think they were all doing together? Right, thinking of you, the customer and how much they care about you.

        They all got together, all of them, exposed themselves to one another with Apple as the ring leader, and agreed to these fixed prices on things like bestsellers and new releases. These are fixed prices full stop. Fixed. That’s what it is. That’s the market they were creating. These books are NOT free. NOT cheaper than $12.99 and not more expensive than $14.99. These are fixed at $12.99 and $14.99.

        With the clause that they couldn’t sell anywhere else for cheaper, prices would rise on Amazon and other retail channels as well to exactly $14.99 and $12.99. More evidence of price fixing: Steve Jobs said in an interview to Walt Mossberg that “Amazon’s prices would be the same” when Walt challenged him on $14.99 eBook that he was looking at which was higher than the average $9.99 price on Amazon.

        Just wake the fuck up.

      2. Oh ya, Shadowself:

        I forgot. All that shit you vomited up about the 30% more bit… you just now received the famous sfgh idiot of the day award.

        “As to the 30% higher argument…”

        I’ve made this statement many times that Apple wanted to increase the price of eBooks by 30%. I’ve said that consumers would be paying 30% higher prices for eBooks across the entire industry with Apple’s way. Here’s why:

        How much of a percentage increase is $12.99 from $9.99? It’s 30%. So I took the lower end of Apple’s price inflation over what the aggregate average eBook price is on Amazon. That’s what I mean by 30%.

        Fuck me.

    1. Slide 9 (repeated towards the end) is damaging to the government’s case. I don’t see why they included it. Oh, sure, it shows prices rising following the agreement; but more importantly it shows prices diverging.

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