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Apple Fires Back At DoJ Over eBook Price Fixing
An anonymous reader writes "CNN takes a look at Apple's response to the Department of Justice's investigation into eBook price fixing. The filing 'cuts the government's case to shreds' while at the same time not bothering to defend the five publishers also under investigation. Apple said, 'The Government starts from the false premise (PDF) that an eBooks "market" was characterized by "robust price competition" prior to Apple's entry. This ignores a simple and incontrovertible fact: before 2010, there was no real competition, there was only Amazon. At the time Apple entered the market, Amazon sold nearly nine out of every ten eBooks, and its power over price and product selection was nearly absolute.'"
That's a lot of words that don't change the fact that virtually every eBook you could ever want to buy costs more now than it did before Apple entered the market, which is the actual problem that the DOJ case intended to address.
Project Gutenberg is great, and I'm sure many would say there are plenty of great 100yo books to keep you busy for a lifetime. But some of us like to read newer stuff too, and just sometimes, an ebook is nicer to deal with than a real book.
Personal preference and all that.
We need some independent publishing houses, and we need them fast. The content distribution should not be that difficult, as long as these indie publishers are able to publish DRM-free books in multiple formats. Make your books available in all the major formats (kindle/epub), and you will kill Amazon, Apple, Google, and anyone else. The question is, what will those companies do to stop you?
It's harmful to pay for books?
From Page 6, Bullet #7 (emphasis mine) "This lawsuit wrongly seeks to condemn Apple based on the Government’s apparent dissatisfaction with the impact of competitive entry, demand stimula- tion and innovation (ignoring significant indicia of consumer and market benefit), not based on any anticompetitive conduct by Apple. This is contrary to law and sound economic policy." "This is contrary to law and sound economic policy" means ( "This is contrary to law" ) AND ( "This is sound economic policy" ) When written correctly, with the Oxford Comma in place, it would have the intended meaning: This is contrary to law, and sound economic policy Yeah, parts of Oxford University don't use the serial comma any more, and some even actively recommend against it's use. Doesn't mean they are right though.
-- obligatory (but true) caveat: my comments my own, and don't reflect my employer or colleagues' positions.
Yes, because you know that those books available on Project Gutenberg were never sold, no one tried to buy one and it was only when they were available online for free that people tried to read them.
I don't have a problem supporting authors I like.
I want you to lose. I think that authors deserve to earn a decent living. So I'll keep buying books and supporting authors I enjoy.
Heaven forbid artists and authors get rewarded for their creativity.
I swear to God...I swear to God! That is NOT how you treat your human!
No, they don't. A writer must sell a great many books to earn a good living; this can be done by writing books you do not like, but it cannot be done by a horrible writer. If you think you've read a published book by a horrible author, then you haven't seen the stuff they're rejecting.
I create copyrighted material all day long, yet for some reason it is normal and expected for me to only get paid while I am creating and a corporation to get all of the ongoing profits.
Perhaps writers and artists would be happier if we changed their "advances" into "wages" or "contract fees".
Isn't that the EXACT conditions of placement in the US Gov GSA catalog? Promise us best price or you don't get to play.
Heaven forbid that artists and authors do a single piece of work and then get paid for it (and some corporation get paid for it) 70+ years *after they are dead*. That is completely f*cked up.
So what? No writer should earn a living because there are some bad ones? There are bad engineers too, should we stop paying all engineers? For that matter, there are bad teachers, and construction workers, and doctors, and every other profession you care to name. I guess we should just stop paying everyone.
If this was about television, movies or music, people would be on here preaching about how you should pirate what you want to see. So anonymous coward, next time an article such as those comes up, I ask you to come back and ask people to support sites with free music & video for download.
I create copyrighted material all day long, yet for some reason it is normal and expected for me to only get paid while I am creating and a corporation to get all of the ongoing profits.
Is this a serious statement? You may want to read up on the definition of "work for hire" versus "authorship" for copyright purposes.
You get paid a salary day in and day out to do this, no? Authors and musicians do not. Unlike you, their success is entirely dependent on the purchase of their works.
"95% of all Slashdot
from a publisher? yes.
from a writer? no.
most authors wold KILL to get $2.00 per book sold. everything else goes to the publisher that is whoring the writers
Do not look at laser with remaining good eye.
while apple is filling many of the publisher's roles taking on some of it's costs and slightly more of its profits. If everything stayed the same then this would mean less money left over for author development via advances and promotion. Apple uses none of it's income for that.
But it may be the case the market for reading increases. That's not clear. The public can only read so much. But maybe they might consume (without reading) more if it is made easy. In which case they offset the profits they remove by expanding the pie.
The people getting hurt are definitely the brick and mortar stores. Which is sad if you are a bibliophile. browsing is wonderful and so is talking to a shrewd librarian or bookstore person about what you might like to read next. I suspect that recommendation systems on online can't match that.
I suspect we will see two divergent phenomena. A narrowing of general tastes while at the same time an enlargement of specialized tastes. That is, fewer books will be read a lot by mainstream readers while rare titles will become more available to those seeking them.
In such a case there is less incentive for the advance or the book tour for marginal authors.
Some drink at the fountain of knowledge. Others just gargle.
If only there were some sort of mechanism, some sort of economic framework for commercial activity between willing parties, that could be used to sort out the question of who deserves how much money.
2006 Amazon was the king of books sold online. If you purchased a book and had it delivered to you house via Fedex chance are you purchased your book from Amazon or its chief competitor Barnes and Noble. Amazon was the Walmart or the Tower records of books.
Sept 2006 Sony releases the PRS-500 e-ink ereader.
Nov 2007 Amazon releases the Kindle and begins marketing it on Amazon.com to its large book buying customer base.
Nov 2009 Barnes and Noble, Amazons primary competitor, releases the Nook two years after the Kindle. It receives good reviews. B&N starts marketing the device in B&N stores to its millions of customers.
Mar 2009 Amazon releases the Kindle app for IPhone (app would later work on IPad)
April 2010 Apple releases the IPad with IBooks three years after the release of the Kindle and 1 year after the release of the Kindle app. The Agency model replaces the wholesale model.
July 2010 Borders starts selling the Kobo ereader three years after the release of the Kindle
Oct 2011 Borders goes into bankruptcy. Kobo survives and still sells books under the Agency model.
So saying there was no competition is strictly true. With the exception of Sony, Amazon did not have any competition for 2 to 3 years. So of course it gained 90% market share. And of course that market share went down after B&N started selling the Nook. If you look at current market share it is similar to Amazons share in 2006. Amazon in #1 and B&N is #2.
The writer does 90% of the work, yet the publisher gets most of the profit.
Sounds like you have never written and had published a book before.
Do not look at laser with remaining good eye.
Just because you may not like an author's books doesn't mean they are horrible. Even if they are horrible some may actually enjoy reading horrible books. Books are worth whatever people are willing to pay for them.
The problem isn't with artists and authors, it's with the middle men who take the majority of the profits.
There are alternatives. I bought several ebooks as a package from Baen.com that were written by an author named Roberta Gellis over almost 50 years ago. I had read some of them in my school library back in the 70's and was looking for them to reread a couple of years ago so I contacted the author at her website and she told me about Baen republishing them. For 6 dollars I got 4 or 5 ebooks in that series and enjoyed rereading the ones I had seen and discovering the ones I had never seen. This is the kind of thing we need more of. As a bonus they were all DRM free! Don't let the covers fool you. They look like harlequin on the cover but read like Game of Thrones inside.
You argument doesn't stand up to history. The switch to the Agency model occurred. It occurred like Steve Jobs promised it would on camera. All the publishers except one changed their pricing with the launch of the IPad. Prices on best sellers went up. The Department of Justice has witnesses and emails showing Apple organized this. The contracts the publishers signed with Apple clearly made it impossible for Amazon to lower prices. Saying Amazon had large market-share isn't a defense for price fixing.
What competition were they trying to quash? Their only competition between 2007 and 2009 was Sony. Sony wasn't exactly marketing their ebook reader. I didn't realize they even made one until B&N started selling the Nook. That is when Borders started putting Sony readers on display in response to B&N. In a loss leading strategy they their profits would go down in the short term. But that never happened. Amazon reported making a lot of profit on the Kindle and ebooks. Basically Apple is just sour that because they were three years late to the party. They had two choices, lower prices further and lower margins, or collude with the publishers to fix prices.
Would you like to cite any concrete sources that show the author does 90% and that the author gets less of the profit than the publisher? No doubt the author does the most important work, but surely the polish a proper publishing team can bring to bear on a book can elevate it above most of the 99c self-published crap on the Kindle Store.
Different authors have had different experiences with this. We know this because they've said so.
Why is it so hard for people to understand that their world view doesn't always represent the life experiences of everyone else?
Actually, you're lucky if they even do marketing.
Sure, the books/authors you've heard about probably have some marketing behind them. That's a tiny fraction of the books published every month.
Most business-savvy writers go both routes, for reasons that become clear when you look at the long-term implications of most publishing contracts.
-- Alastair
Exactly. Consider the entire romance genre. The vast majority of them are the literary equivalent of a Happy Meal and I know many women who buy a dozen a month and blow throw them as if someone may steal it from them.
Ever read anything by V.C. Andrews? An ex-girlfriend goaded me into reading one of her books and I didn't even finish due to how fucking sick it was, and I've been reading Stephen King and similar since I was in 3rd grade. She must have really enjoyed reading about rape and sexual abuse or something...
I am not making it up. Look closely at the statement amounts for the last quarter. Amazon only states they are making a ton of _revenue_ off the Kindle, not a ton of profit; they do not break out the numbers to pinpoint where their meager profit comes from. Search the web for sites that give estimates of what the Kindle costs to make vs. what they sell it for and make your own decision. The actual numbers are not reported, so the estimates are the best you can do. But something that cannot be hidden is the actual margin for the company. See the NYT discussion of Amazons last quarter:
http://www.nytimes.com/2012/04/27/technology/amazon-profit-dropped-35-percent.html
The article brags about the GROSS margin (profit minus cost of goods which is 24%) but the net margin is their take-home pay. (You can tell if a site is pro or con Amazon by which they report.) To explain the difference, imagine that for $20 including shipping I sell you a book I bought for $10, and it costs me $10 to ship it. My gross margin is 100%, but my net margin is 0%. Amazon's net margin is the total cost of their doing business, including web infrastructure, salaries, real estate taxes, shipping, and everything else that actually costs them money. Amazon's net margin is 130 million profit/13.18 billion revenue or 1.01%! By comparison, Apple's last quarter numbers were 47.4% gross margin and 28.3% net margin.
The gp actually was more believable than you...
His made up figures *at least* he got one part right - he put it in terms of PROFIT.
In other words he wasn't arguing that publishing is free. He was arguing that the publishers get the lion's share of the PROFIT - which seems to be a fairly well established fact...
And paranormal romance. It's impossible to find anything in Amazon's sci-fi category nowadays because of the deluge of that stuff, 99% of which even fans of the genre say is crap.
For a site about things like basic rights, Slashdot users sure do like to censor "dissent".
Far from it. If anything, Amazon sold e-books so cheap to drive more Kindle sales. And loss leading to crush competition is very much illegal (and obvious to boot), so I'd find it a little unlikely that Amazon would risk it. The reason they were cheap before is because it was a wholesale model - Amazon and the publisher negotiated a price, Amazon paid for it, and could then set the price at whatever they wanted. They could have 100% markup, 50% markup, 10% markup, or 0% markup - whatever. They could likely negotiate better prices, as it was actually a negotiation. Under the new model, the prices are set by the publisher, and the seller gets a commission. No negotiation, no discounting, no nothing.
For a site about things like basic rights, Slashdot users sure do like to censor "dissent".
No, it doesn't. That would be written, "This is contrary to law and is sound economic policy." (More likely, it would be written, "This is contrary to law but is sound economic policy.")
There is no place for the serial (also known as "Oxford" or "Harvard") comma in that sentence, since where it is used at all, it is used in separating the final item in a series of 3 or more.
Nor would commas separating the elements do anything to tell you whether the common portion of the list ended with "is" or "to" and whether the first element started with "contrary" or was just "law".
If one was especially concerned about avoiding potential confusion of the meaning, one could rewrite the sentence as "This is contrary to both law and sound economic policy", but while that would be more explicit, it is unnecessary, but in any case throwing superfluous commas into the sentence doesn't help anything.
It is one thing to pedantic. It is something worse to be pedantic and wrong.