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Apple's lawyer said the agency model is beneficial to both consumers and markets

The e-books price-fixing trial with Apple has begun, and a U.S. government lawyer accused Apple of conducting shady business practices with the five book publishers. 

"Apple told publishers that Apple - and only Apple - could get prices up in their industry," said Lawrence Buterman, a lawyer at the U.S. Department of Justice (DOJ). 

Buterman also added that Apple's agency model with publishers (where publishers set the price and Apple takes a 30 percent cut) hurt consumers by raising prices. 

"Overall, average prices of e-books went up, costing consumers millions of dollars," said Buterman.

The three-week trial, which started yesterday, concerns the DOJ's lawsuit against Apple in regards to its method of fixing prices for e-books. 

Orin Snyder, Apple's attorney, disagrees with the DOJ's statements. 

"What the government wants to do is reverse engineer a conspiracy from a market effect," said Snyder. "Agency [model] is good and beneficial to consumers and markets."

Snyder added that DOJ's evidence, such as emails from former Apple CEO Steve Jobs, will likely be misinterpreted. He also said that average e-book prices fell after Apple entered the market, dropping from $7.97 to $7.34.

Apple is the target of the e-books investigation along with book publishers Hachette Livre (Lagardère Publishing France), Harper Collins (News Corp., U.S.A.), Simon & Schuster (CBS Corp., U.S.A.), Penguin (Pearson Group, United Kingdom) and Verlagsgruppe Georg von Holzbrinck (owner of inter alia Macmillan, Germany). However, all the book publishers have already settled with DOJ, so Apple is the only company going to trial. 

This all started in April 2012, when the U.S. Department of Justice (DOJ) sued Apple and the five book publishers over anticompetitive practices concerning e-book sales. The book publishers were accused of partaking in an agency sales model with Apple, and the publishers could not let rivals sell the same book at a lower price. Traditionally, publishers sell physical books to retailers for about half of the cover price, which is considered a wholesale model. Retailers then had the ability to sell those books to customers for a lower price if they wanted to.

But when e-books came along, this model was challenged. Amazon started selling best sellers for as low as $9.99 to encourage its Kindle e-reader sales. Publishers were not happy with this because they thought the prices were too low.

However, Apple attempted to resolve this when it struck a deal with publishers to implement the agency model in 2010. This helped Apple at the time of its iPad and iBooks launch. But its deal with publishers made it seem like an attempt to thwart Amazon's dominance.

In April of this year, DOJ used an old email from former Apple CEO Steve Jobs as evidence in the e-books case. The email (dated in 2010) from Jobs to James Murdoch of News Corporation said, "Throw in with Apple and see if we can all make a go of this to create a real mainstream e-books market at $12.99 and $14.99.”

U.S. District Judge Denise Cote, who is overseeing the trial, said last month in a preliminary hearing that the e-books price fixing case seemed to fall in favor of the DOJ
"I believe that the government will be able to show at trial direct evidence that Apple knowingly participated in and facilitated a conspiracy to raise prices of e-books, and that the circumstantial evidence in this case, including the terms of the agreements, will confirm that," said Cote.

Source: Reuters

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RE: This is why so many people dislike Apple
By Tony Swash on 6/4/2013 4:10:51 PM , Rating: 2
Yes it is better to not notice the problem prior to shipment, then to blame the customer, then fix it later on?

So when is the fix for the Galaxy 4 due?

Let's hope it's quicker than the non-existant fix for the Galaxy 3 which had this to say on page 13 and 128 of it's manual:

Do not touch the or cover the area around the antenna with your hands of other objects.

Apparently doing so "may result in reduced call quality or cause the device to emit unintended levels of radio frequency energy" Yikes!

Page 174 Galaxy 3 manual

By retrospooty on 6/4/2013 4:15:33 PM , Rating: 2
I'm still not seeing where this article or thread is about Samsung in any way shape or form. Read it again, it's about Apple and price fixing. This spawned a discussion about all the other dirty tricks Apple pulls. Where did Samsung come into it? do you seriously think no one sees you trying to totally distract from the subject matter? You are getting more and more transparent as time goes by

RE: This is why so many people dislike Apple
By sprockkets on 6/4/2013 8:10:29 PM , Rating: 2
So when is the fix for the Galaxy 4 due?


Never, since it wasn't an issue to begin with, neither with any of those other phones on that stupid blog.

The SG4 has internal antenna's which aren't exposed via the outer metal banding like the stupid iphone4 had, allowing people to bridge one to another greatly attenuation it, versus a little like every properly made phone out there.

I mean, they only fixed it on the verizon version, then the iphone4s and above, but no, that isn't an admission of guilt, ever.

RE: This is why so many people dislike Apple
By Tony Swash on 6/4/2013 8:35:43 PM , Rating: 1
The SG4 has internal antenna's which aren't exposed via the outer metal banding like the stupid iphone4

So I guess Samsung made a silly blunder when they posted this graphic showing the antenna areas on the outside of the phone that should not be touched by the users hands?

And when the official manual for the Samsung Galaxy S4 says on page 8 -

"Do not cover the antenna area with your hands or other objects. This may cause connectivity problems or drain the battery."

- they are actually talking about users putting their hands inside the handset?

I knew that that most Samsung phones were big but I hadn't realised they were that big!

RE: This is why so many people dislike Apple
By sprockkets on 6/4/2013 9:04:05 PM , Rating: 1
God you are so stupid/trolling.


By testerguy on 6/5/2013 3:59:10 AM , Rating: 1
Funniest self-humiliating response ever.

If you run out of arguments, caps lock + swearing.

Always a winner.

By croc on 6/5/2013 6:42:53 AM , Rating: 2
Do you still beat your wife?

"I f***ing cannot play Halo 2 multiplayer. I cannot do it." -- Bungie Technical Lead Chris Butcher

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