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EU Targets Apple In Ebook Investigation
nk497 writes "The European Commission is investigating Apple and five publishers regarding ebook pricing, after raiding ebook firms earlier this year. 'The Commission will in particular investigate whether these publishing groups and Apple have engaged in illegal agreements or practices that would have the object or the effect of restricting competition,' the watchdog said."
Paul Thurrott's column on this speaks to that question, and describes the logic of the antitrust investigation pretty succinctly:
Before Apple's entry, publishers set the wholesale price of books, but retailers could determine the final selling price. But Apple changed that, allowing publishers for the first time to determine the final price at which eBooks were sold to consumers. As a result, the average selling price of new eBooks jumped from $9.99 to $14.99.
The EC will try to determine if the firms colluded to fix prices and restrict competition. Both charges should be easily proven.
As I reported in February 2010, while Apple was negotiating with the major publishers, at least one of them, Macmillan, demanded that Amazon raise prices on its Kindle books to match Apple's prices. Amazon, now as then, owns the dominant eBook platform, called Kindle. And Macmillan threatened to pull its books from the Kindle unless Amazon went along with the price hike. After temporarily pulling Macmillan's titles from its store, Amazon capitulated and raised prices as demanded.
"We have to capitulate and accept Macmillan's terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books," Amazon wrote to customers at the time.
Certainly publishers should be able to charge what they want for a book. The rest of what you say is good only... not true. You can find video games on sale for different prices from different stores. If you don't see different products at different prices, you're just not looking hard enough. Modern warfare 3 sells for $59 most places, but I managed to find it for $52. Lots of things go on sale. I could buy the hunger games trilogy in Hardcover from Barnes and Noble for $30 or from Amazon for $22. But the ebooks were the same price everywhere (and inexplicable more expensive than the hardcovers). Nobody cries foul because for other items because, while everyone buys things at the same price, they don't all take the same amount of profit and resell it at the same price. At least they don't have to. Ebooks are a problem because publishers have contracts explicitly saying how much profit a company can, and has to make (the "agent" model).
Ebooks are slowly changing the way authors sell their books. No longer do you need a publisher to sell you book. Self-publishing is not only a possibility now, but it is also a reality. The only thing you can get from a publisher now is up front fees and marketing. But with the web, you can do much of that yourself.
Step 1. Create a company to help authors promote books
Step 2: ????
Step 3: Profit
21st Century Renaissance Man
Actually, in Germany book sellers are required by law to sell books at the same price (at least those from German publishers). And for that, there is indeed a word: "Buchpreisbindung".
However the sellers are quite creative at it: You may sell damaged books at lower prices, and therefore you quite often find "damaged" books where the only "damage" is the text "Mängelexemplar" ("flawed exemplar") on them.