Apple E-Books Trial: Critical Emails Released

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Murdoch did eventually agree to Apple’s terms. Shortly after this email exchange, HarperCollins forced all e-book retailers to adopt this pricing structure for their e-books.

The trial will begin on June 3rd in New York. The outcome for Apple will probably not be severe. Steve Jobs was the ringleader. He is no longer alive. Tim Cook seems to have nothing to do with this debacle.

The media is surprisingly calm about the whole affair. The e-books scandal has garnered only a fraction of the attention of antennagate or mapplegate. The e-books scandal is a bit more complicated and may not affect consumer demand for Apple products. I personally never bought an e-book from Apple. I use the Kindle app on my iPad and iPhone, because Kindle e-books are less expensive. Despite his intentions, Steve Jobs didn’t get his way. Amazon was still able to sell e-books at a price that undercut Apple.

My hunch is that Apple will win the case. The terms of the settlement are not severe. If they won’t settle, they must have a great strategy. “Oh, the guy who dunnit is dead.” Perhaps it is not a strategy, but the reality.

Also, before we start screaming bloody murder at Apple, ask yourself why Amazon is selling an e-book below cost. Murdoch mentions that Amazon pays $13 for the e-book, and sells it for $9.99. This may be to drive adoption of the Kindle, however, the end game is domination. When the competitors have given up on selling e-books, Amazon will have a monopoly and can charge whatever they want.

While I don’t condone Steve Jobs’ actions, I certainly understand them. He wanted to stop Amazon from dumping e-books below cost in order to dominate the market. Perhaps I will stop buying Kindle books, even though they are inexpensive. In the end, we will all pay a high price for e-books if Amazon dominates this market.

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  1. Hmmmm. Have had a kindle, gift, do not buy books, read the ones other family members buy, and have not figured out library kindle use, from public libraries, so wind up using kindle for Facebook, and online search for info. Did not know about price fixing on any of it until my ramble, as I try to get my Apple tv working again, after cable guy went from wireless to Ethernet for tv HD equality from cable, I think.

    1. The price fixing is a bit creepy, but their intent was to prevent Amazon from dumping e-books on the market. The latter practice is actually good for consumers, in the short term, as they pay less for e-books. The concern is, after other competitors leave the market, Amazon would have a monopoly and could drive up prices.

      Apple’s moral appeals are starting to wear thin on me. They made a similar argument against Spotify. They claimed Apple Music pays artists more fairly. The reality is, the difference is insignificant. Google Music actually pays artists more than any other service. Tidal is also pretty good. But I digress… The point is that Apple’s moral appeals are just PR tools.

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