Latest in Amazon

Image credit:

A comprehensive look at Apple's ebook price fixing suit

Share
Tweet
Share
Save

Sponsored Links

A US District judge recently ruled that Apple conspired to raise e-book retail prices in an effort to keep rivals from using e-book prices as a loss leader. Apple is currently planning on appealing the ruling, but it will be months before it comes before the Circuit Court of Appeals, if the appeal gets approved at all.

It was a complex suit that thanks to the appeals process is still ongoing, but what exactly was it all about? Adam Engst at TidBITS has written a comprehensive examination of Judge Denise Cote's 160 page opinion explaining why Apple lost the suit.

At the heart of the suit was Amazon's loss-leader pricing on ebooks, regularly selling titles to readers for $9.99 regardless of whether or not that was less than Amazon paid publishers (which was intended to boost overall sales of Amazon's Kindle readers and the ebook market as a whole). Apple and book companies worried that this sort of pricing would create a false perception of the value of an ebook.

In 2009, before Apple opened its own iBookstore, Amazon controlled 90% of the ebook market. When Apple entered in 2010 the company and publishers agreed to an "agency" model for ebook publishing, meaning the publishers set the price for books and in exchange they were paid a set percentage of sales.

The rest of the TidBITS piece goes into the problems with the agency model, explains how exactly this deal was ruled as an antitrust violation, what happened legally to the publishers, and answers basically every question you could have about this suit. It's a long read, but it's a great analysis of a complicated situation.

In this article: amazon, antitrust, ebooks
All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission.
Share
Tweet
Share
Save

Popular on Engadget

Engadget's Guide to Privacy

Engadget's Guide to Privacy

View
This week in tech history: Android turns 11

This week in tech history: Android turns 11

View
Microsoft invites more people to test very rough Xbox features

Microsoft invites more people to test very rough Xbox features

View
Fitbit is reportedly in the early stages of exploring a sale

Fitbit is reportedly in the early stages of exploring a sale

View
Tilta mods Blackmagic's Pocket Cinema Camera with a tilt screen and SSD

Tilta mods Blackmagic's Pocket Cinema Camera with a tilt screen and SSD

View

From around the web

Page 1Page 1ear iconeye iconFill 23text filevr