As recently reported in this article in The Guardian, Apple will be going to court this coming Monday in an attempt to overrule a 2013 ruling by the US Justice Department that the company's iBooks division was involved in a “conspiracy” with several major publishing houses, including Hachette, Penguin, HarperCollins, MacMillan, and Simon & Schuster. The suit alleged that the companies were in violation of the Sherman Act for “horizontal price fixing.”
Their alleged motive? To undercut Amazon's 80-90% monopoly of the marketplace, dominating via set price dictation, offering ebooks at a fixed rate of $9.99, often against the wishes of the publishers, who were selling the hardcover versions for closer to the standard $26 or so. Apple's bold foray into the field with the introduction of the iPad in 2010 caused prices to spike industry-wide by an alarming 17%. Publishers had finally found a more profitable alternative, but Amazon was quick to respond with an organized legal defense. The ruling? The publishers collectively settled the case for a reported $69 million. Apple is gambling that it will reverse the decision on December 15. If it is successful, it will pay nothing. If not, Apple stands to lose $450 million total. How does this affect little ol' you? Unless you happen to be under contract with any of these companies, it doesn't impact you at all, at least not directly. But the upshot of this highly publicized case means the marketplace remains a competitive, lucrative field for both newcomers and veterans. Readers will ultimately decide which books are worth paying for, and for what amount. (Unless, of course, they're being illegally downloaded). Meantime, the independent author would do well to keep his or her ebook pricing low, even .99 cents. Why? You need to compete with bigger names being published by big brands. Lowering the reader's risk means potentially raising your authorial profile and reputation. How much do you want to pay for an ebook by a new author, whether self-published or not? Photo courtesy of Michael Cote
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