Apple responds to DOJ, says e-book price fixing "not true"
Apple spokesman Tom Neumayr released this statement to AllThingsD.
The Justice Department'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.
Attorney General Eric Holder accused Apple and five book publishers with "conspiracy" to fix the price of e-books, following the "agency model."
The agency model lets publishers set the price for book, not the retailer. In comparison, the wholesale model allows retailers to negotiate with publishers over the cost of the book rights. The retailer gets to set the price, which in theory fosters more competition to the benefit of consumers. Apple's iBookstore users the agency model, while Amazon uses a wholesale model.
Besides Apple, the Justice Department pressed charges against five book publishers: Macmillan Publishers, Penguin Group, Hachette Book Group, HarperCollins Publishers, and Simon & Schuster (owned by CBS)
Hachette Book Group, HarperCollins Publishers, and Simon & Schuster agreed to settled charges, Holder stated in a press conference Wednesday.
Holder also announced that retailers like Amazon and Barnes & Noble would have the "freedom to reduce the prices of their e-book titles."
Apple, Macmillan Publishers, and Penguin Group have yet to reach a settlement. From the looks of the company's statement today, it doesn't seem like Apple is planning to settle.
According to analysts, the Justice Department doesn't have as strong a case against Apple as the publishers, which have already settled.
"It's a harder case against Apple than the publishers," Geoffrey Manne, who teaches antitrust law at the Lewis and Clark Law School in Oregon, told CNET.
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