Apple finally responds to price fixing litigation, points finger at Amazon
This entry was posted on Thursday, April 12, 2012.
" The DOJ’s accusation of collusion against Apple is simply not true. The launch of the iBookstore in 2010 fostered innovation and competition, breaking Amazon’s monopolistic grip on the publishing industry. Since then customers have benefited from eBooks that are more interactive and engaging. Just as we’ve allowed developers to set prices on the App Store, publishers set prices on the iBookstore. "
The issue revolves around Apple following a distinctly different pricing model for ebooks as compared to music. In the case of the former, Apple has been allowing ebook publishers to set the price they want for their products, as long as Apple gets a 30% share of the pie. This is distinctly different from their strategy for selling music in the iTunes Store, where they follow the traditional wholesale purchasing model, to set the price they want themselves. The entire range of allegations essentially revolve around Apple's unprecedented ebook retail model, which is alleged to be a front for price hike collusion among all ebook publishers.
Through its official statement, Apple contends that its ebook pricing model in fact did away with Amazon Inc.'s monopolistic tendencies, as it had been the largest ebook retailer by a long distance, before Apple came into the frame.