Justice Department Presents Opening Arguments Against Apple in E-Book Price Fixing Trial

In a Manhattan courtroom this morning, the U.S. Department of Justice presented its opening arguments in USA v Apple Inc, the antitrust e-book price fixing trial. The DoJ filed suit last April and Apple has consistently defended itself and has said the accusations are "simply not true".

According to AllThingsD, Justice Department attorney Lawrence Buterman presented the government's case this morning, using a slideshow filled with email and phone record evidence that the government says shows Apple colluded with book publishers to drive up the cost of e-books ahead of the launch of the iBookstore.



For its part, Apple's lead attorney claims the company was using the same strategies that worked when the company was building the iTunes Music Store to get contracts with the major book publishers. From Apple 2.0:

Apple's opening statement […] tried to pull the rug out from under everything the DOJ had just presented. [Apple SVP Eddy] Cue, Snyder claims, was just trying to break into a crowded e-book market (one dominated by Amazon) using precisely the same approach he used when he got the company into the music market with iTunes and the applications market with the App Store. Those innovation poured billions of dollars into the U.S. economy, he said. "Apple should be applauded, not condemned."

Eddy Cue -- Apple's senior vice president for Internet Software and Services, and one of its chief negotiators -- sits squarely at the middle of the DoJ's case and was responsible for much of the email and phone traffic mentioned in the government's opening argument. He is expected to take the stand on June 13th.

The Department of Justice has settled with all of the book publishers initially accused, while Apple remains the main target of the suit.

Top Rated Comments

(View all)
Avatar
97 months ago
Score: 17 Votes (Like | Disagree)
Avatar
97 months ago

We should know now that price fixing is only ok when Amazon is doing it in order to run competitors out of business.


Except that isn't what Amazon is doing. Amazon is selling at low/no/negative profit margins, they're hoping to make it up in volume. That isn't price fixing, the publishers still get the wholesale price of their books, Amazon sets the retail price, which is many cases is below what they bought them for from the publishers.

Now I'm not saying that what Amazon is doing is great for competitors, but it isn't illegal unlike what the publishers and Apple are accused of doing.

Amazon could be accused of abuse of monopoly power in the market hurting their competitors, but that isn't what this case is about.

For this case and this case only Amazon didn't do anything *legally* wrong, Apple probably did.
Score: 12 Votes (Like | Disagree)
Avatar
97 months ago

This lawsuit is ridiculous. Must be funded by Amazon.

This is all very simple. Book publishers are upset with Amazon because they can't set the prices of their books (they want MORE money not less). They sign with Apple so they can set their own prices. Surprise, surprise, books are higher priced because Book publishers are allowed to set the prices to prices THEY want (higher).

Amazon should be the one sued, not Apple.


I like how you call the lawsuit ridiculous, then make a wildly unfounded assertion as to how the suit has been funded.

The free market should dictate prices. Prices shouldn't be artificially inflated simply because the laws of supply and demand are no longer working in your favour.
Score: 9 Votes (Like | Disagree)
Avatar
97 months ago

Except that isn't what Amazon is doing. Amazon is selling at low/no/negative profit margins, they're hoping to make it up in volume. That isn't price fixing, the publishers still get the wholesale price of their books, Amazon sets the retail price, which is many cases is below what they bought them for from the publishers.

Now I'm not saying that what Amazon is doing is great for competitors, but it isn't illegal unlike what the publishers and Apple are accused of doing.

Amazon could be accused of abuse of monopoly power in the market hurting their competitors, but that isn't what this case is about.

For this case and this case only Amazon didn't do anything *legally* wrong, Apple probably did.


Amazon loses money on ebooks... This is why big corporations win, they can play chicken longer...

Amazon buys books at 10 dollars sells a 9,99 (they lose 1 cent), how can they make ANY profit from volume sales ?
They don't and since not that many companies can keep up with losing money (don't forget the cost of running the business itself, not just the buying/selling the merchandise) they just end up running the competition to the ground...

Go ask your tiny bookshops around the corner.
Score: 9 Votes (Like | Disagree)
Avatar
97 months ago
This lawsuit is ridiculous. Must be funded by Amazon.

This is all very simple. Book publishers are upset with Amazon because they can't set the prices of their books (they want MORE money not less). They sign with Apple so they can set their own prices. Surprise, surprise, books are higher priced because Book publishers are allowed to set the prices to prices THEY want (higher).

Amazon should be the one sued, not Apple.
Score: 9 Votes (Like | Disagree)
Avatar
97 months ago

Whatever happened to free choice?

Consumers who don't like Apple pricing, can go to Amazon. Its that simple!

If you knew anything about this issue you would not be asking such a question. :rolleyes:

It has nothing to do with what Apple and Amazon charge for ebook, in simple terms. It is about why Apple and Amazon [have to] now charge extra for ebooks. It is regarding the [forced] change in business model with publishers supposedly changed by Apple under Steve Job's.

It's not that simple, Steve said so therefore it must be true.... Right?
Score: 7 Votes (Like | Disagree)

Top Stories

Apple References Unreleased 2020 16-Inch MacBook Pro in Boot Camp Update

Monday October 26, 2020 8:42 am PDT by
Last week, Apple released an update for Boot Camp, its utility for running Windows on a Mac. While this update would typically be unremarkable, several of our readers noticed that the release notes reference an unreleased 2020 model of the 16-inch MacBook Pro. While this could easily be a mistake, the 16-inch MacBook Pro is nearly a year old, so it is certainly a worthy candidate for a...

Google Reportedly Pays Apple $8-12 Billion Per Year to be Default iOS Search Engine

Sunday October 25, 2020 2:59 pm PDT by
The United States Justice Department is targeting a lucrative deal between Apple and Google as part of one of the U.S. government's largest antitrust cases, reports The New York Times. On Tuesday, the Justice Department filed an antitrust lawsuit against Google, claiming the Mountain View-based company used anticompetitive and exclusionary practices in the search and advertising markets to ...

iPhone 12 Pro Allows You to Measure Someone's Height Instantly Using LiDAR Scanner

Saturday October 24, 2020 11:12 am PDT by
iPhone 12 Pro models feature a new LiDAR Scanner for enhanced augmented reality experiences, but the sensor also enables another unique feature: the ability to measure a person's height instantly using the Measure app. You can even measure the seated height of a person in a chair, according to Apple. When the Measure app detects a person in the viewfinder, it automatically measures their...

MagSafe Charger Only Charges at Full 15W Speeds With Apple's 20W Power Adapter

Monday October 26, 2020 3:38 pm PDT by
Alongside the iPhone 12 and 12 Pro models, Apple introduced a new MagSafe charger that attaches to the magnetic ring in the back of the devices, providing up to 15W of charging power, which is double the speed of the 7.5W Qi-based wireless charging maximum. Apple does not provide a power adapter with the $39 MagSafe charger, requiring users to supply their own USB-C compatible option. Apple...

Early iPhone 12 Tests Show Ceramic Shield is Stronger and More Scratch Resistant Than iPhone 11 Glass

Friday October 23, 2020 1:21 pm PDT by
Apple's new iPhone 12 models are protected by a Ceramic Shield cover glass that has nano-ceramic crystals infused right into the glass to improve durability. According to Apple, Ceramic Shield offers four times better drop protection than the glass used for the iPhone 11 models. YouTube channel MobileReviewsEh conducted some tests on the iPhone 12 using a force meter to compare its performance ...

iPhone 12 Six-Foot Drop Test Results: Ceramic Shield More Durable But Not Damage Proof

Monday October 26, 2020 5:00 am PDT by
Apple's new iPhone 12 and iPhone 12 Pro feature a new Ceramic Shield screen that Apple says offers 4x better drop performance. To test that claim, Allstate Protection Plans put the two models through a range of breakability tests and recorded the results. In a face down sidewalk drop test at six feet, the iPhone 12 suffered small cracks and scuffed corners and edges, leaving sharp grooves in ...

Bloomberg: New AirPods and AirPods Pro Coming in 2021, AirPods Studio Delayed, Third HomePod Model Also Possible

Monday October 26, 2020 3:34 am PDT by
Apple plans to update its AirPods line next year with two new models including third-generation AirPods and second-generation AirPods Pro, according to a new report from Bloomberg. The Cupertino, California-based technology giant is working on two new models: third-generation entry-level AirPods and the second version of the AirPods Pro earbuds, according to people familiar with the plans. ...

Report: Apple Silicon iMac Featuring Desktop Class 'A14T' Chip Coming First Half of 2021

Tuesday October 27, 2020 4:14 am PDT by
The first iMac powered by Apple Silicon is set to arrive in the first half of next year and will feature a desktop class "A14T" chip, according to Chinese-language newspaper The China Times. Codenamed "Mt. Jade," Apple's first custom-made desktop processor will be twinned with its first self-developed GPU, codenamed "Lifuka," both of which are being produced using TSMC's 5-nanometer process, ...

iPhone 11 Pro Outlasts iPhone 12 and 12 Pro in Extensive Battery Life Test

Friday October 23, 2020 8:36 am PDT by
Arun Maini today shared a new side-by-side iPhone battery life video test on his YouTube channel Mrwhosetheboss, timing how long the new iPhone 12 and iPhone 12 Pro models last on a single charge compared to older models, with equal brightness, settings, battery health, and usage. All of the devices are running iOS 14 without a SIM card inserted. In the test, the iPhone 11 Pro outlasted both ...

Apple Warns MagSafe Charger Can Leave Circular Imprints on Leather Cases

Friday October 23, 2020 3:23 pm PDT by
If you keep your iPhone in a leather case while charging with Apple's new MagSafe Charger, the case might show circular imprints from contact with the accessory, according to a new Apple support document published today. Apple's leather cases for the iPhone 12 and iPhone 12 Pro are not available until November 6, but a MacRumors reader has already shared a photo of a circular imprint on...