Justice Department May Sue Apple, Publishers for Colluding to Raise Prices of E-Books
March 8th, 2012Via: Reuters:
The Justice Department has warned Apple (AAPL.O) and five major publishers that it plans to sue them, accusing them of colluding to raise the prices of electronic books, a person familiar with the probe said on Thursday.
Several parties have held talks to settle the potential antitrust case, said the person, who was not authorized to speak publicly on the matter.
The five publishers facing possible Justice Department action are Simon & Schuster Inc, a unit of CBS Corp (CBS.N); Lagardere SCA’s (LAGA.PA) Hachette Book Group; Pearson Plc’s (PSON.L) Penguin Group (USA); Macmillan, a unit of Verlagsgruppe Georg von Holtzbrinck GmbH; and HarperCollins Publishers Inc, a unit of News Corp (NWSA.O).
U.S. and European officials have been investigating whether e-book publishers and Apple fixed prices in the growing electronic book industry, blocking rivals and hurting consumers.
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Apple’s push for agency pricing was detailed in Walter Isaacson’s biography of Apple founder Steve Jobs.
The book says that Jobs, who died in October, was aware of publishers’ frustration with Amazon. It quotes Jobs as saying: “So we told the publishers, ‘We’ll go to the agency model, where you set the price, and we get our 30 percent and yes, the customer pays a little more but that’s what you want anyway.’ … So they went to Amazon and said, ‘You’re going to sign an agency contract or we’re not going to give you the books.'”
