E-Books Trial: Apple Responds

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What will happen if Apple is found guilty? Based on the settlement terms accepted by other publishers, probably not much. There may not be any damages. The judgement would likely remove the agency pricing model and mandate that retailers can set the price on e-books.

Apple could have accepted the settlement, but that would imply they are guilty. Apple is not fighting this case because e-books are critical to their business. This seems to be more about corporate image. Acknowledging unscrupulous business practices can hurt their image. Unfortunately, bringing this to trial has uncovered evidence that seems to have done more harm than good. Apple should have just settled and let the matter go away. The debacle made few waves. It was not the media tsunami of mapplegate.

The greater harm seems to be Amazon’s predatory tactics. It may be that Apple was pursuing something decent. Amazon’s pricing was great for consumers in the short-term. But what happens when their low prices have detracted competitors? Will they still sell e-books at a loss, or gouge consumers? Amazon is not a charity. The latter scenario is likely. That would be an Amazondystopia.

Perhaps many of the publishers accepted Jobs’ strategic proposal because they saw the big picture — after Amazon dominated the market, they could call the shots to the disadvantage of publishers. Nonetheless, colluding to fix prices is illegal. Dumping products on the market is also illegal. One has to wonder why the Justice Department is pursuing Apple with flimsy evidence, when Amazon is holding a smoking gun? Is this political or a way for top Justice Department officials to get a feather in their cap?

It remains to be seen if collusion actually occurred. Apple is determined to show this is not the case. It is unclear whether the Justice Department will pursue a case against Amazon for dumping e-books on the market. Apple could have even gone the route of filing an antidumping petition with the U.S. Department of Commerce.

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