Eddy Cue Speaks About iBooks Price-Fixing Case: 'We Feel We Have to Fight for the Truth'

In a new interview, Apple's Eddy Cue spoke with Fortune about the e-books pricing scandal that has plagued the company over the past several years. After a July 2013 judgment found the company guilty of conspiring to fix prices of electronic books, and a settlement in a class-action lawsuit was reached over the summer, the Apple negotiator at the center of the lawsuit has shared his thoughts on the case with Fortune ahead of Apple's appeals court appearance later this month.

The specifics of the case lie in the opening of the iBooks Store and the 17 percent industry-wide increase in e-book prices following its unveiling in April of 2010. Cue, Apple's "master negotiator", played a key role in convincing five of the then-six major publishing houses to start selling e-books through Apple's new store alongside the launch of the iPad. Part of the deal involved a shift in the pricing model for the entire e-books industry, eliminating Amazon's previous pricing advantage in which it would sometimes sell books at a loss in order to attract customers to Kindle hardware and other Amazon products.

These events led the Justice Department and thirty-three state attorneys general to sue Apple and those five publishing houses for horizontal price fixing in violation of the Sherman Act. While the publishing houses settled the lawsuits, Apple declined to do so and proceeded to trial in the federal case where the company was found guilty.

“Is it a fact that certain book prices went up?” asks Cue. “Yes. If you want to convict us on that, then we’re guilty. I knew some prices were going to go up, but hell, the whole world knew it, because that’s what the publishers were saying: ‘We want to get retailers to raise prices, and if we’re not able to, we’re not going to make the books available digitally.’ At the same time, other prices went down too, because now there was competition in the market.”

A settlement in the separate state and class-action consumer lawsuit worked out this past June sees Apple paying around $450 million if the company loses its appeal in the federal case and nothing if it wins. The case has dragged on far longer than most expect, and Cue argues that the company is fighting more for reputation than for monetary reasons.

Eddy Cue, Jimmy Iovine, Apple, Beats Music, Code Conference

“We feel we have to fight for the truth,” says Cue. “Luckily, Tim feels exactly like I do,” he continues, referring to Apple CEO Tim Cook, “which is: You have to fight for your principles no matter what. Because it’s just not right.”

Cue met with all six CEOs of the major publishing houses before the original iPad launched, and discovered most wanted the cost of e-books at price points both he and Steve Jobs considered too high. Cue proposed price tiers tied to the suggested retail prices of the hardback versions of the books.

As part of the shift to a new "agency model" of pricing similar to that used in the App Store, Cue also proposed a "most favored nation" clause, allowing Apple to match the price at which any retailer was selling a new e-book. When the iPad launched a few weeks later, most iBooks were priced between $12.99 and $14.99, higher than Amazon's typical $9.99 price point for best sellers but in the range of where publishers wanted to be selling their books. The agency model quickly became the industry standard, with Amazon also being required to adopt the pricing at the insistence of the publishers.

The sequence of events led Judge Denise Cote to rule in July 2013 that Apple was guilty of e-book price-fixing. When asked how he looks back on the "nightmare", Cue plainly stated, "If I had it to do all over again, I’d do it again. I’d just take better notes."

Apple will appear before the federal appeals court on December 15.

Popular Stories

iPhone 17 Air Pastel Feature

iPhone 17 Air Battery Capacity and Weight Allegedly Revealed

Monday May 19, 2025 2:22 am PDT by
Apple is expected to launch an all-new ultra-thin iPhone 17 Air later this year, and while there have been plenty of rumors about the camera's overall design and thinness, we haven't heard any details about the device's weight and battery capacity until now. According to the leaker going by the account name "yeux1122" on the Korean-langauge Naver blog, the 6.6-inch iPhone 17 Air has a weight ...
Apple CarPlay Ultra instrument cluster themes 01

Apple's CarPlay Ultra Is Here – Does Your iPhone Support It?

Thursday May 15, 2025 5:17 am PDT by
Apple's recently announced CarPlay Ultra promises a deeply integrated in-car experience, but not all iPhone users will be able to take advantage of the new feature. According to Apple's press release, CarPlay Ultra requires an iPhone 12 or later running iOS 18.5 or later. This means if you're using an iPhone 11, iPhone XR, or any older model, you'll need to upgrade your device to access...
Apple CarPlay Ultra instrument cluster themes 01

Apple's 'CarPlay Ultra' Experience Now Available

Thursday May 15, 2025 5:07 am PDT by
Apple today announced that its next-generation CarPlay experience, now dubbed "CarPlay Ultra" begins rolling out today, starting with Aston Martin vehicles. Subscribe to the MacRumors YouTube channel for more videos. CarPlay Ultra is now available with new Aston Martin vehicle orders in the U.S. and Canada. It will also be available for existing models that feature the brand's next-generation ...
WWDC 2025 Banner

Apple Announces WWDC 2025 Schedule, Including Keynote Time

Tuesday May 20, 2025 8:13 am PDT by
Apple today announced a more detailed schedule for its annual developers conference WWDC, which runs from June 9 through June 13. The schedule confirms that Apple's keynote will begin on Monday, June 9 at 10 a.m. Pacific Time, with a live stream to be available on Apple.com, in the Apple TV app, and on YouTube. During the keynote, Apple is expected to announce iOS 19, iPadOS 19, macOS 16,...
macOS 16 visionOS Inspired Feature 1

macOS 16: Everything We Know So Far

Tuesday May 20, 2025 7:31 am PDT by
The Worldwide Developers Conference (WWDC), Apple's annual developer and software-oriented event, is less than three weeks away. We haven't heard a great deal about macOS 16 ahead of its announcement this year, so we could be in for some major surprises when June 9 rolls around. Here's what we know so far about the next major update to Apple's Mac operating system. macOS 16 Name? Every year ...
Apple Glass

Apple Smart Glasses: Everything We Know So Far

Wednesday May 21, 2025 8:21 am PDT by
Google made waves yesterday by showcasing a set of lightweight smart glasses featuring deep Gemini integration and an optional in-lens display. The demo has reignited interest in Apple's own smart glasses project, which has been the subject of rumors for nearly a decade. Here's a recap of where things stand. Current Development Status Apple is actively working on new chips specifically...
Apple Intelligence General Feature

Report: Apple's Next-Gen Version of Siri Is 'On Par' With ChatGPT

Monday May 19, 2025 9:00 am PDT by
Apple has big plans to improve Siri over the next few years, Bloomberg's Mark Gurman and Drake Bennett report. Some Apple executives are now reportedly pushing to turn Siri into a true ChatGPT competitor. A next-generation, chatbot version of Siri has reportedly made significant progress during testing over the past six months; some executives allegedly now see it as "on par" with recent...

Top Rated Comments

gnasher729 Avatar
137 months ago
You tell them, Fast Eddie.

Well, and there is Amazon which is _really_ trying to corner the eBook market. By all means. And there is Apple, trying to break the monopoly. And then there are people who have no idea what this case is about and deliberately misinterpret what Eddy Cue says.
Score: 31 Votes (Like | Disagree)
Oletros Avatar
137 months ago
Well, and there is Amazon which is _really_ trying to corner the eBook market. By all means. And there is Apple, trying to break the monopoly. And then there are people who have no idea what this case is about and deliberately misinterpret what Eddy Cue says.
Oh, the irony on calling others ignorant about the case and then saying that App tried to break a monopoly
Score: 12 Votes (Like | Disagree)
Zimmy68 Avatar
137 months ago
You tell them, Fast Eddie.

How you kept your job after this blows my mind.


"Is it a fact that certain book prices went up?" asks Cue. "Yes. If you want to convict us on that, then we're guilty. I knew some prices were going to go up, but hell, the whole world knew it, because that's what the publishers were saying: 'We want to get retailers to raise prices, and if we're not able to, we're not going to make the books available digitally.' At the same time, other prices went down too, because now there was competition in the market."


Great, what are fighting? You admitted it. I give you credit for that.
Score: 12 Votes (Like | Disagree)
kingtj Avatar
137 months ago
I confess I never followed this one real closely ....

But it sounds to me like Apple's making a sound argument. Book publishers were basically saying, "Screw you, Apple. We won't give you the rights to digital versions of our content because we don't think we get paid enough money when we sell our stuff that way." Apple said, "Well, hold on guys... How about you do pricing in tiers, like THIS (tied to the in store prices of the physical books)? Then you can make more money selling in our store and we're still at a price point we think is reasonable." They agreed, and it generally worked. Other publishers copied the same pricing structure, since it was working. And then people saw nobody was offering those "selling below cost" deals Amazon had been doing, and cried "Price fixing!" to the government.



Good to see Apple execs are as pompous as their products (I'm an Apple user - the products are a bit pompous don't you think?)

Stick to your principles Eddie, don't forget to fall on your sword - if you have any honor.
Score: 11 Votes (Like | Disagree)
gnasher729 Avatar
137 months ago
Oh, the irony on calling others ignorant about the case and then saying that App tried to break a monopoly

Well the irony of posting "Oh, the irony".

Do you have any actual arguments why we shouldn't call Amazon the big bully in the eBook market that it is?
Score: 10 Votes (Like | Disagree)
itr81 Avatar
137 months ago
You tell them, Fast Eddie.

How you kept your job after this blows my mind.


"Is it a fact that certain book prices went up?" asks Cue. "Yes. If you want to convict us on that, then we're guilty. I knew some prices were going to go up, but hell, the whole world knew it, because that's what the publishers were saying: 'We want to get retailers to raise prices, and if we're not able to, we're not going to make the books available digitally.' At the same time, other prices went down too, because now there was competition in the market."


Great, what are fighting? You admitted it. I give you credit for that.

I doubt Eddie is saying anything that's not setup by Apple legal at this point.
Score: 8 Votes (Like | Disagree)