DOJ: Apple colluded with publishers to raise e-book prices
Apple violated antitrust laws by colluding with book publishers to raise the price of e-books in an effort "to strip retailers of pricing authority," federal prosecutors said in a court filing released Tuesday, according to Bloomberg.In an antitrust lawsuit filed by the U.S. Department of Justice in April 2012, the government accused Apple and five book publishers of conspiring to illegally fix e-book prices to boost profits and force e-book rival Amazon to abandon its discount pricing. All five of the publishers involved -- Hachette Book Group, HarperCollins Publishers, Simon & Schuster (owned by CBS, which publishes CNET), Macmillan Publishers, and Penguin Group -- have now settled.The prosecutors' filing, which was released Tuesday but originally filed on April 26, detailed e-mails and depositions of some of Apple's top brass, including the company's late founder Steve Jobs and Senior Vice President Eddy Cue, according to Bloomberg. In one published e-mail, Jobs told James Murdoch, then CEO of News Corp, the parent company of HarperCollins, that Apple's millions of customers could be an important asset to publishers. "Apple's iTunes Store and App Store have over 120 million customers with credit cards on file and have downloaded over 12 billion products," Jobs wrote, according to Bloomberg. "This is the type of online assets that will be required to scale the e-book business into something that matters to the publishers." For its part, Apple also filed a document with the court that was released to the public Tuesday and originally filed on April 26. In this document, the tech giant denied prosecutors' accusations and said no collusion took place but rather constant, detailed, one-on-one negotiations. "Early -- and constant -- points of negotiation and contention were over Apple's price caps and 30 percent commission. After Apple sent draft agency agreements to each publisher CEO on January 11, each immediately opposed Apple's price tiers and caps," Apple said its 81-page filing, according to Reuters.In March, U.S. District Judge Denise Cote ruled that Apple CEO Tim Cook must testify in the case if it goes to court. Currently, the case is set to go to trial in Manhattan in June.CNET contacted Apple for comment. We'll update the story when we get more information.
