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EU plans to end Apple antitrust investigation in light of relaxed iPhone rules
It seems like Apple's legal team is constantly embroiled in a pitched battle of some sort, but this weekend they might get to relax -- citing recent iPhone policy changes, the European Commission's decided to stop breathing down their necks. Though the EU originally joined the US Department of Justice and Federal Trade Commission in investigating why Cupertino chose to block third-party dev tools and ads earlier this year, the fact that Apple recently relaxed both restrictions (and created a repair program for iPhones purchased abroad) satisfied European regulators. "The Commission intends to close the investigations into these matters," it wrote earlier today. There's no guarantee that the US powers-that-be will exercise similar leniency, of course, but we wouldn't be surprised -- even inside Apple, the DoJ's got other fish to fry.
Apple, Adobe, Google, Intel Intuit and Pixar: now free to cold call each other's employees
Attaboy, DoJ! Out of (almost) nowhere, the United States Department of Justice announced today that it was requiring six well-known technology outfits to stop entering into "anticompetitive employee solicitation agreements," and we're guessing you will have heard just a few of these names: Adobe, Apple, Google, Intel, Intuit and Pixar. As the story goes, these six companies were all mixed up (but not all together, mind you) in agreements that forbid each other from cold calling employees from a rival firm in order to offer them a different job. According to the DoJ, those arrangements acted as a "significant form of competition to attract highly skilled employees," and it has now filed a civil antitrust complaint today along with a proposed settlement that, "if approved by the court, would resolve the lawsuit." We're also told that some of the agreements were put into place as early as 2005, and they were "formed and actively managed by senior executives of these companies." Yikes. Hit the source link for the full report, and feel free to call back that "Unknown" caller that keeps hitting you up on your Adobe line -- it's probably Pixar with a seven-figure offer.
HP agrees to pay $55 million to settle investigation into illegal kickbacks
The company that kicked Mark Hurd to the curb for financial impropriety has today reported it'll pay $55 million in a settlement with the US Department of Justice relating to some fiscal delinquency of its own. HP was accused of greasing up the wheels of business, as it were, by throwing cash around to companies who would recommend its services to state procurement agencies. This particular set of allegations related to a federal contract obtained by HP in 2002, and the settlement also extinguishes investigation into whether or not the computer vendor had provided incomplete information to the US government. That's all well and good, but we have to question the size of these levies. Today's also the day that HP's announced a new $800 million supply contract with the US Air Force -- would a fine that's less than a tenth of the contract's value really deter HP's entrepreneurial spirit?
HannStar Display shells out $30m to settle LCD price fixing case
Another day, another company pleading guilty to their role in a massive global price-fixing conspiracy surrounding the MSRP of LCDs. The Taiwan-based HannStar Display agreed (grudgingly, we surmise) this week to cough up a whopping $30 million for its role in the scheme, marking the seventh company to "plead or agree to plead guilty as a result of the department's investigation into the LCD industry." All told, the US Department of Justice has seen some $890 million paid out and 17 executives charged, with HannStar in particular being pegged for violating the Sherman Act during its participation in the conspiracy from September 2001 to January 2006. So, anyone up for being lucky number eight?
DoJ's inquiry at Apple purportedly expanding beyond iTunes practices
Take this for whatever it's worth (which isn't a whole heck of a lot without any official confirmation from any of the parties involved), but the New York Post has it that the Justice Department's inquiry into Apple's iTunes practices may in fact be growing. 'Course, it's not exactly surprising to hear that authorities are now investigating every nook and cranny of Apple's tactics thanks to Steve Jobs' public thrashing of Flash and his sly insistence that the world shun Adobe while hugging HTML5, but we've still yet to hear from the DoJ and Apple about what exactly is going on within Cupertino. At any rate, the Post notes that a number of "sources" have confirmed that the inquiry is growing, most notably to include "how the iPhone and iPad maker does business with media outfits in areas beyond music." We'd heard whispers that things may be getting just a bit too dictator-ish in the developers Ts and Cs, and now it seems that the DoJ is "asking questions about the terms that Apple lays out for computer programmers who want to develop apps for the iPad." It'll be interesting to see how all of this plays out, but we can bet devs (and end-users, frankly) are hoping and praying for less restrictions in the future.
DoJ making preliminary inquiries into Apple's music endeavors while iTunes dominance continues
It's all just noise right now, but the United States Justice Department is purportedly having a "very preliminary conversation" with Apple regarding the company's music business, wondering in particular if anything it's doing (or has done) would violate antitrust legislation. According to unnamed sources familiar with the situation, DoJ staff seem most interested in whether or not Apple's dominance in the market enabled it to unfairly prevent Amazon's music service from exclusively debuting new songs. Beyond that, details of the investigation are few and far between, but it's coincidentally coming down on Cupertino when its iTunes numbers are on the up and up. The latest NPD research figures show that over a quarter of the music purchased within the US is now procured through iTunes -- 28 percent, if you're looking for specifics, which is up 4 percentage points from Q1 2009. Meanwhile, Amazon has pulled into a tie with Walmart for second place, which may or may not coerce Wally World to ditch its morals and finally start stocking that uncensored version of My World 2.0.
Apple under preliminary antitrust investigation over iPhone, triggered by complaint from Adobe
We'd heard a somewhat sketchy report from the New York Post yesterday that the Department of Justice and the Federal Trade Commission were considering launching an antitrust inquiry into Apple and its various iPhone-related practices, and now it's being confirmed by Reuters and the Wall Street Journal, who say the inquiry was triggered by complaints from Apple's competitors and app developers -- specifically Adobe, according to Bloomberg. The DOJ and FTC are currently deciding which agency will take the lead in any inquiry, but if and when it gets underway there are a few issues at play: the first is obviously Apple's decision to block Flash and other middleware from app development, and the second is Apple's new iAd platform, which comes with its own changes to the iPhone developer agreement that could potentially lock out third-party ad and analytics services like AdMob -- itself under regulatory scrutiny due to the Google acquisition -- and Flurry. We'd also imagine regulators will take a close look at Apple's App Store policies in general, but from a distance looks like the focus is on mobile advertising: both Apple and Google have made aggressive moves into the space in recent months, and both have come under regulatory scrutiny. We'll just have to wait and see how this one plays out -- there's still no official word from either agency on what's happening, and the timeline of any potential investigation and lawsuit will be measured in months and years.
Apple to face antitrust inquiry over iPhone coding restrictions?
Apple's decision to block third-party toolkits and middleware -- particularly Flash -- from being used to develop iPhone and iPad apps has certainly prompted a fair amount of debate around the web, and now it sounds like Steve and the gang might face some even harsher scrutiny: a single-sourced piece in the New York Post reports that the Federal Trade Commission and the Department of Justice are currently tussling over which agency should be tasked with a potential antitrust inquiry into the matter. That would certainly make some noise in the industry, but it doesn't mean much for those of us here in reality quite yet: assuming the report is true, an inquiry would still just be the very first step -- whichever agency is ultimately put in charge would then have to launch a formal investigation and then finally file and win a lawsuit for any changes to occur. That's a timeframe measured in months, if not years. All that said, we can see why the feds are interested: Apple's slowly moving into an ever-more dominant position in the mobile market, and forcing developers to make a hard choice about which platforms to target certainly puts the squeeze on competitors. We'll be following this one closely -- stay tuned.
If you throw away your console, the terrorists have won
In one of those fun, yet uncomfortable, instances where real life and video games interact, Fox News has uncovered a dusty (and old, very old) PlayStation controller during a raid of an Afghanistani farmhouse, which doubled up as a munitions depository. Lying there, in among rockets, grenades, plastic explosives and tank shells, was this humble blue-hued PlayStation appendage, which we're told can be rewired to act as a remote detonator. Should you question just how seriously the US government is taking this growing tide of console-aided terrorism, below you'll find a press release (seriously, a state-issued press release) detailing the detainment of four men in connection with the illegal transportation of digital cameras and PlayStation 2s to a "terrorist entity" in Paraguay. If convicted of the most egregious charge, they face 20 years in prison... for contraband consoles. Face, meet palm.
Justice Department settlement puts on-campus Kindle use on hold
Amazon may have recently announced it was beefing up the Kindle's functionality for vision-impaired users, but it looks like that's too little too late for three universities using Kindles as an alternative to textbooks, who have now agreed to shelve the e-readers until such enhancements are in place as part of a settlement with the Justice Department. Those universities include Pace, Case Western, and Reed College, who were all sued by two organizations representing the blind, which alleged that while the Kindle has a text-to-speech function, the menus do not, thereby making them impossible for blind students to use -- another university testing the Kindle, Arizona State, has already reached a similar settlement. Assuming Amazon lives up to its promises, however, it looks like the Kindles could be put back to use as soon as this summer -- and the universities in question will still be able to finish any pilot programs currently taking place this semester, just not expand their use.
Hitachi and Toshiba subpoenaed in DOJ optical drive price fixing probe
We kinda knew that there couldn't be any antitrust smoke without the fire of market collusion, and sure enough, Sony Optiarc has been joined on the naughty step by Hitachi-LG Data Storage and Toshiba Samsung Storage Technology Corp. As the names should tell you, these are joint ventures involving some of the world's biggest electronics manufacturers, whose American optical drive divisions appear to be under suspicion of fixing prices. We'd have expected Hitachi and LG to wise up after paying out fines for LCD price fixing recently, but when you look at Hitachi's stock trading up after this news -- with traders confident any forthcoming fines will be too small to dent the company's bottom line -- maybe "by hook or by crook" is actually a viable business plan?
Sony Optiarc garners unwanted attention from DOJ for possible Blu-ray or DVD price fixing
In a filing with the Tokyo Stock Exchange this morning, Sony has revealed a request for information from the US Department of Justice regarding its optical drive production arm, Sony Optiarc. While the same filing indicates the Japanese giant's belief that this information gathering is part of a wider investigation into competition in the optical drive market, we've yet to hear of any other companies facing the same request. If you were feeling disgruntled with the pace of Blu-ray price drops, this might just be your moment of vindication... or it could be a storm in a teacup. There's really not enough information to tell either way right now, but if we know anything about the DOJ, it's that it loves shaking down naughty corporations. We'll keep a careful eye on this as it develops.
Amazon, Microsoft and Yahoo unite against Google Books
Microsoft, its new pet dog Yahoo, and Amazon have decided to join together in the soon to be formed Open Book Alliance. You might expect this to be a revolutionary new collaborative effort at delivering the written word in a way that makes Google Books pale into insignificance, but you would, of course, be wrong. Far from trying to compete with Google, The OBA is set to act as the collective mouthpiece for all those opposed to Google's recent $125 million settlement deal with book publishers and authors. With the US Department of Justice already investigating antitrust concerns relating to the case, the other big dogs just couldn't restrain themselves from coming together for a united whinge. Should the settlement be cleared, it will permit Google non-exclusive rights to orphan works (those without an established writer) and will give it a 30 per cent cut of books sold via Google Books, both things that authors have agreed to. So what's there to moan about, fellas -- we all trust Google to do the right thing, right?
Palm's Colligan rebuffs Steve Jobs' 'likely illegal' plea to stop hiring from Apple
Imagine the scene two years ago, August 2007 to be precise. Palm was busy preparing to launch its Foleo and the OS that would save Palm was still expected to be coming from ACCESS. In fact, things were looking so bad for Palm in August that we penned an intervention letter that then CEO Ed Colligan responded to. Apple, for its part, was still enjoying the glow of the golden halo rising above its iPhone launched just over a month prior with the help of 2% of Palm's hired workforce, according to Bloomberg. Oh, and Apple had just lost Jon Rubinstein, the man leading its iPod division, to Palm.Now Bloomberg is reporting that Steve Jobs approached Palm's Ed Colligan in August 2007 with a proposal to refrain from hiring each other's staff (read: quit poaching our employees, Ed!). Colligan refused, saying,Your proposal that we agree that neither company will hire the other's employees, regardless of the individual's desires, is not only wrong, it is likely illegal.Meeeow.
Department of Justice casually looking into abuses of power by big carriers?
Word on the street has it that the US Department of Justice has started informally looking into whether top carriers have gotten all antitrust-y on us, specifically investigating hardware exclusives and restrictions on the services third parties can offer on the network (open access, anyone?). The carriers potentially being called into question here -- most likely Verizon and AT&T, seeing how they're the largest by a long shot and have both made recent acquisitions to beef up their footprints and positions -- say that they've received no notices of investigation, so if this is really happening, it's still in the earliest stages. Beefs over handset locking and exclusivity are nothing new and have come from governments and competitors alike -- but considering the price flexibility they ultimately give carriers on the front end, they've still got a place in the hearts and minds of consumers who put a premium on (perceived) value and instant gratification. It remains to be seen what'll happen to pricing when you can't promise your carrier you won't run off with its subsidized gear the next day, but we can't imagine it'll be good.
WaPo: DOJ preparing antitrust probe for Apple, among others
Apple, Google, Yahoo! and Genentech are subjects of a fresh antitrust investigation surrounding hiring and recruiting practices among companies in the tech industry, according to Washington Post staff writer Cecilia Kang. "By agreeing not to hire away top talent, the companies could be stifling competition and trying to maintain their market power unfairly," antitrust experts said in the article. Hiring and recruiting can sometimes be a touchy affair, as Apple found out late last year when trying to hire Mark Papermaster. The investigation may suggest some kind of written agreement among large tech firms to not hire away each other's top talent. According to the New York Times, Justice has only requested documents for the ongoing investigation. Neither the Justice Department nor any of the companies mentioned in the story had any comment. This comes in addition to another Justice investigation into ties between the boards of directors of Apple and Google, and whether or not having Google CEO Eric Schmidt on both (and Genentech CEO Arthur Levinson on all three) constitutes antitrust violations. Some consider Apple and Google to be competitors in certain areas such as phone handsets. The Obama administration is stepping up efforts to investigate anti-competitive activity among high-tech companies, and is already investigating Google's deal with book authors to republish their work via Google Books. [Via AppleInsider]
Hitachi also admits to LCD price fixing, will pay $31m fine
Funding that stimulus package just got ever-so-slightly easier -- Hitachi is the latest company to fess up to LCD price fixing, and as part of its deal with the US Department of Justice, it's paying a $31m fine. The company has specifically admitted to fixing the prices on panels sold to Dell from 2001 to 2004, and while no Hitachi execs are due to join their comrades from LG and Chungwha Picture Tubes just yet, we'd encourage them to book their vacations now, since the DOJ seems like it's staying on the warpath.
AT&T pays out $8.2 million settlement over school E-Rate program
"Settlement" and "needy schools" aren't two things that most companies would like to see in a press release, but that's exactly what AT&T is dealing with at the moment after it has paid out $8.2 million to settle a dispute involving the E-Rate program, which uses funds collected from phone customers to pay for hardware and connectivity service fees for schools and libraries. According to the Department of Justice, AT&T (or, more specifically, AT&T Technical Services Corp.) allegedly not only engaged in non-competitive bidding practices for E-Rate contracts, but claimed and received E-rate funds for goods and services that weren't eligible for the program, and over-billed the E-Rate program for some of the services it provided. This resolution is also apparently specifically a result of a federal investigation into fraud and anti-competitive conduct in the E-Rate program in Indiana which, it seems, is still ongoing.
AT&T reportedly eyeing post-merger Verizon Wireless assets
As you may recall, one of the requirements that Verizon had to agree with in order to complete its little acquisition of Alltel was that it must offload some $3 billion in wireless assets to avoid becoming too monolithic, and it looks like there's already a number of bidders angling for a piece of the action. The biggest of those, by far, is AT&T, which is apparently looking to pick up as big a chunk of the assets as it is able to and, according to The Wall Street Journal, it's in a good position to do just that. Other interested parties reportedly include a joint bid from the Carlyle Group and Kohlberg Kravis & Roberts & Co, a separate bid from Providence Equity Partners LLC, and at least one unnamed cable provider. Any of those bids, however, would still be subject to approval by the Department of Justice, with AT&T sure to draw the most scrutiny of the lot.[Via The Wall Street Journal]
Three more executives indicted in LCD price fixing scheme
Protip, if you were involved in LCD price fixing between 2001 - 2006, just turn yourself in because the U.S. Department of Justice is still coming. To the surprise of anyone who thought the last couple months of guilty pleas and fines were the end, a DOJ statement today spells out indictments returned by a federal grand jury in San Francisco against two former Chungwha Picture Tube execs and one from LG Display. All the legal details in the case against Cheng Yuan Lin, Wen Jun Cheng and Duk Mo Koo are in the statement beyond the read link, but hey man, we're still waiting on our refunds.[Via Reuters]
