Apple denies e-book price-fixing accusation
iWant…iNeed..an iPad? Not so fast. If Apple loses the e-book lawsuit vs. the Department of Justice for alleged price fixing, Amazon will be left in complete control of the electronic- book publishing industry.
For the every day person, this might not be anything more than two leading affiliates of the electronic industry, Apple and Amazon, butting heads in a competition war.
But it could lead to one incredible change, the ultimate lowering of e-book prices, regardless of owning an iPad or a Kindle.
Some, however, argue that it eventually could drive up prices.
With the majority of Amazon e-books costing $9.99, what Amazon is doing is essentially designating a price that is too low for its competition to match.
With the main competitor being Apple, Amazon would be able to set the e-book market at whatever price it deems fit.
The fact that Amazon is already projected to account for well over 50 percent of all book sales this year, further supports Amazon’s economic claim. The lawsuit revolves around the original iPad, debuting in 2010.
At the time, Amazon’s Kindle was the e-book king, with electronic books for the device costing only $9.99.
The risky component was in 2009, when Amazon’s publishers supposedly went to Apple for guidance in regulating its prices that were considered too low in comparison to the amount of profit earned.
The publishers increased its prices to more profitable levels.
With e-book prices seemingly increasing faster than gas prices, it was clear that illegal agreements were occurring behind closed doors to prevent competition between competitors.
Allegedly, Apple met with six large publishers at a New York City restaurant to discuss raising prices on e-books.
However, in the Justice Department’s 36-page complaint, it goes into detail of the publishers’ meetings, and the one notable missing — Apple.
The current e-book market looks a lot different than what it will if the Department of Justice opens the doors for Amazon to create an empire out of the market.
Amazon wasted not a minute in alerting customers of the drop in prices. “This a big win for Kindle owners and we look forward to being allowed to lower prices on more Kindle books,” an Amazon spokesman said via email.
The only thing Apple can do to combat this effectively is to lower its prices, too.
In a Friday statement to The Times, Apple spokesman Tom Neumayr said that “the Department of Justice’s accusation against Apple is simply not true.”
Just a few days earlier, federal and state officials filed antitrust lawsuit against the companies, claiming former Apple Chief Executive Steve Jobs orchestrated a central role in the conspiracy to increase digital book prices.
Federal investigators say Jobs’ e-book price boost cost consumers tens of millions of dollars over the past couple years. Blaming the dead guy is not a substantial way out for the billion-dollar company.
In a market that thrives off of its competition, Apple needs to further strategize on its prices and not lose consideration for its consumers throughout the process.