Apple and Big publishers named in price fixing

Ramblings News iPad

Our friends at Apple are in court so much these days one would be forgiven for thinking they had changed their business strategy and were moving into the field of law. From patent lawsuits on Iphones with Samsung through to worker suicides in their suppliers factories and now price fixing. Apple and a group of very well known book publishers have been accused of “illegally fixing e-book prices to “boost profits and force rivals Amazon to abandon its pro-consumer discount pricing”. From a brief reading of the lawsuit filed, it focuses around Apple entering the kindle market with the Ipad with the intention of colluding with major publishers to increase e-book prices listed.

Within the lawsuit filed, aside from Apple are big name publishers such as Harper Collins, Hatchette books, Macmillan, Penguin publishing and Simon and Schuster. The companies are being accused of employing what us known as an “agency model” in the industry. What this involves is prices set at a publisher level rather than being decided upon by each individual retailer. If this doesn’t sound familiar think Ipod. I was working in electronic retail when the IPod phenomena first started and clearly remember being told the prices were fixed by Apple and not negotiable.
Interestingly, the lawsuits are not being instigated by Amazon but rather 2 disgruntled customers, sick and tired of paying premium prices due to greedy corporation’s anti-competitive laws. They are seeking a class action suit for restitution and damages as well as admittance on defendants behalf.

Amazon has been serving book lovers worldwide for years now with cheaper prices and reasonable shipping rates being blamed for the closure of many bricks and mortar stores. With their acquisition of the mighty bookdepository their potential stronghold on the online book market is undeniable. What the publishers had in their favour was an ally with as much to lose as them, someone who was as “terrified of Amazons popularity as themselves; Apple,” says Steve Berman. Representing the plaintiffs, Berman knows what to do. “We intend to prove that Apple needed a way to neutralize Amazons kindle before its popularity could challenge the upcoming introduction of the Ipad.”

The pricing model first materialised in 2010 when publishers asked Amazon to raise its online prices, with Amazon denying the request, stating that any price over $9.99 was too expensive. Eventually they gave in after Macmillan started pulling popular titles from its catalogues.

Immoral, unethical and just downright greedy, Apple continue their Nazi like stance on their market position, further emphasising why I will never touch another of their products.

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