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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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