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Apple eBook price fixing case: opponents say Amazon is the real threat

The US Department of Justice (DOJ) yesterday released some of the comments it received regarding the ongoing Apple eBook price fixing case, and many of those opposed to the deal argued that the alleged violations helped stop Amazon's stronghold on the eBook market.

In total, the DOJ received 868 comments from individuals, publishers, booksellers, and even Apple.

"Those in support largely commented favourably on the government's efforts to end the conspiracy that cost e-book purchasers millions of dollars, and restore competition to the e-book market," the DOJ said in its response to those comments [PDF], which were filed with a New York district court Monday. "Critical comments generally were submitted by those who have an interest in seeing consumers pay more for e-books, and hobbling retailers that might want to sell e-books at lower prices."

In its comments, Apple said that the DOJ is looking to "impose a business model" that will re-establish Amazon's alleged eBook monopoly, charges the DOJ denied.

The issue dates back to April, when the DOJ filed suit against Apple, as well as five other publishers, over an alleged "illegal conspiracy" involving eBook price fixing.

Apple, as well as publishers Macmillan and Penguin, are fighting the charges, while Hachette, HarperCollins, and Simon & Schuster agreed to a proposed settlement.

The DOJ opened up a public comment period on the case, prompting yesterday's filing. The agency said it "received many comments that sought to excuse price fixing as necessary to end Amazon's reported 90 per cent share of the e-book market, and noted that Apple's entry effectuated erosion of Amazon's share and spurred all sorts of innovations, such as colour e-books."

The DOJ disagreed. "The reality is that, despite its conspiratorial efforts, Apple's entry into the e-book market was not immediately successful. It was, in fact, Barnes & Noble's (B&N) entry — prior to Apple — that took significant share away from Amazon; and many of the touted innovations were in development long before Apple decided to enter the market via conspiracy."

Barnes & Noble filed comments in which it argued that the DOJ's actions would void its agency contracts - whereby the publishers rather than the retailers set eBook pricing. The DOJ, however, said that was not the case and argued that B&N is simply "worried that it will make less money after the conspiracy than it collected while collusion was ongoing."

As a result, the feds concluded that their proposed final judgment "provides an effective and appropriate remedy for the antitrust violations alleged in the complaint and is therefore in the public interest."

The DOJ has asked the district court to approve the judgment once comments are entered into the Federal Register.