Apple, Book Publishers May Settle EU Investigation in One Month
September 20, 2012 8:07 AM
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Apple and the four publishers offered to let Amazon and other retailers sell e-books at a reduced price for two years
Apple and the four major book publishers under the EU microscope have officially
offered a solution
to their e-book troubles: allow Amazon and other e-tailers to sell e-books at a discount.
This proposal was originally brought up back in August, where Apple and publishers Harper Collins (News Corp., USA), Simon & Schuster (CBS Corp., USA), Hachette Livre (Lagardère Publishing France) and Verlagsgruppe Georg von Holzbrinck (owner of inter alia Macmillan, Germany) attempted to settle the investigation by the European Commission. Penguin, the fifth book publisher involved in the case, did not submit a settlement proposal.
The proposal is that the publishers will not restrict or limit an e-book sellers' ability to set, change or reduce e-book prices for two years. They also won't interfere with an e-book retailer's choice to offer discounts.
In addition, Apple and the publishers have agreed to suspend "most favored nation" contracts for five years, which stopped publishers from allowing other e-book sellers, like Amazon, sell e-books at lower prices than Apple.
The Commission said it is considering the settlement proposal offered by Apple and the four publishers. It will now allow third parties to offer their opinions, and in one month, the Commission will decide to either end the investigation or continue.
While the EU investigation may soon come to a close, the same can't be said for the U.S. Department of Justice's investigation into the same issue. DOJ sued Apple and the same five publishers in April 2012, and soon after three publishers made settlement deals with the government (Harper Collins, Simon & Schuster and Hachette Livre).
Apple, Penguin and Macmillan, on the other hand, will duke it out with the DOJ at the
U.S. bench trial on June 3, 2013
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9/20/2012 6:03:15 PM
You should read the pages you actually linked to. They are figures for
. You need to know what rates the big houses negotiated. Small shop/self-publishers often pay more because their volume is usually lower compared to the costs they incur, the big houses have more bargaining power, and self-publishing has been relatively expensive in the past (so their rates would be competitive).
Also, you will note that Amazon does not take a bigger cut. Its cut is the same as Apple if you are on the 70% royalty option. Which option you take is currently up to you.
The fact that delivery cost and tax is baked into the sale price means the royalties will be lower, but it is better for the consumer because there are no hidden taxes or fees. The price you see is what you pay. If you have seen those web listings for $20 products listed for 1 cent but with $35 in "shipping and handling" charges you will understand why they did this.
"Spreading the rumors, it's very easy because the people who write about Apple want that story, and you can claim its credible because you spoke to someone at Apple." -- Investment guru Jim Cramer
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