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Ignorance is Bliss: Apple’s E-Books and Antitrust
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Apple claims that it had no idea that its publishers were “engaged in a conspiracy to fix e-book prices.” The Justice Department lawsuit represents $840 million in claims brought by the state as well as consumers. Yet the company says that they are innocent. According to Bloomberg, Apple had no knowledge that the publishers were engaged in a conspiracy in December 2009 or at any other point.

Apple tried to rid itself of court appointed oversight while it appealed, however, “Manhattan U.S. District Judge Denise Cote concluded in July after a nonjury trial that Apple schemed with publishers to limit retail price competition and raise e-book prices.”


Apple’s sales of e-books, movies, mp2s, apps, and its other media were at $12.9 billion in 2012, which represents slightly less than 10% of its total revenue. After the iPad was released in 2010, the e-book business became the next big thing for Apple. The publishing industry saw huge overhaul and bankruptcies across the board as the disruptive technology changed the dynamics of literary consumption. In the Amazon marketplace, book sellers and publishers have to pay 30% to have their wares in the marketplace- a tight squeeze for most publishers who see slimmer margins all the time. While Apple’s defense is that they are non-monopolistically trying to engage the marketplace and help consumers have an option besides the giant Amazon, the judge did not see things that way. Apple continues its appeal.

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