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"corrective measures employed by Apple" what were the measures and what were they correcting? And how did the Justice Department get it wrong. Apple colluded wi

"corrective measures employed by Apple" what were the measures and what were they correcting? And how did the Justice Department get it wrong. Apple colluded with the publishers to set the price, and forced Amazon to sell for the same price. With mainly the people being screwed (well in some cases the publishers actually lost money too) Unfortunately the corrective measures taken SINCE the ruling having really made much of a change.

eridius 12y ago
> Apple colluded with the publishers to set the price, and forced Amazon to sell for the same price Apple gave the publishers leverage to use with Amazon, which is a wee bit different. But I'll give you "colluded", because it doesn't really matter. I wish Google would actually find the various articles I've read in the past about this, but my recollection is that various economists have explained that this sort of "corrective measure" is actually legal and the right course of action under certain circumstances, and the ebook market (with Amazon's near-total dominance) qualifies. You say "mainly the people being screwed", but that's not true. Amazon tried to claim that prices were lower before Apple came along, but that's actually only true for some (admittedly popular) books. Prices on other books were higher before Apple. Not only that, but the low prices that Amazon was talking about was not actually a sustainable market, but instead was Amazon engaging in predatory pricing. And predatory pricing is not something that the DOJ is supposed to be in the business of defending. Basically, many people have looked at the overall book market both before and Apple entered it, and found that, when looking at the entire market instead of just e.g. the NYT bestsellers list, prices were not higher after Apple showed up. It's also worth pointing out that Apple was being accused of violating antitrust laws, which are essentially laws designed to prevent unfair monopolistic practices. It seems rather ridiculous to claim that a minority player in a market could be guilty of monopolistic practices, since that generally requires being a monopoly. It's even more absurd when one of the main goals of antitrust is to promote fair competition, and yet it was used to punish the only real competition that Amazon had in the market. Basically, the DOJ used fair competition laws to hand a government-sanctioned monopoly to a single company. --- I did a bit more digging, and what Apple was found guilty of was a "per se" violation of a horizontal price-fixing conspiracy using a series of vertical agreements. I've found a MacObserver article[1] that talks about a 30-page amici curiae brief filed by two economists explaining why Judge Cote's ruling was wrong. [1]: http://www.macobserver.com/tmo/article/economists-on-apple-ebook-antitrust-case-judge-cote-got-it-wrong http://www.macobserver.com/tmo/article/economists-on-apple-e... There's a 3-paragraph summary at that article, which should give you a good idea of what was wrong with the ruling. I've seen a number of other articles since the ruling where other economists weigh in and say essentially the same thing, but Google is still being difficult. --- Edit: One comment about this brief says that the DOJ didn't make these considerations because it found Apple to be per se liable, which is to say, the DOJ considered the actions to be illegal regardless of any possible motivation. Some of the other economists I've referred to argued specifically against this point, saying that these kinds of vertical agreements are not a violation of the per se rule and that Judge Cote royally screwed up in applying it. Of course, Judge Cote's ruling also said she would consider Apple to have been guilty under a rule of reason as well, but I find it hard to believe given how much evidence there is that Apple's actions were indeed in its own independent business interest, and that these kinds of vertical agreements and the provisions they contained are not in fact illegal under these circumstances (my understanding is basically that they can be illegal when used by a dominant player in a market, because it's anti-competitive, but when used by a new entrant in a market with an existing dominant player, they are ok, but IANAL).
- Oletros 12y ago
  > Basically, many people have looked at the overall book market both before and Apple entered it, and found that, when looking at the entire market instead of just e.g. the NYT bestsellers list, prices were not higher after Apple showed up. Basically, many people have looked at the 5 publishers accused of collusion and have seen that prices were higher AFTER the collusion
  - eridius 12y ago
    Are you trying to claim that somehow this whole affair affected book prices for the smaller publishers that didn't have agreements with Apple? Because for both of us to be right, all the smaller publishers must have dropped their prices precipitously to offset this supposed increase across the board in the prices of the 5 big publishers.
    - Oletros 12y ago
      I'm trying to say that ebook prices from publishers other than the 5 accused are irrelevant. The fact is that the ebook average price from the accused publishers went up, it is irrelevant for that case that the total market average prices were down.
      - eridius 12y ago
        Ok, so you are saying that the price of the other publishers went down, and apparently dropped enough to offset the fact that they're, well, smaller publishers, and therefore a smaller part of the book market. I don't think that's true. I have never heard that the smaller publishers kept dropping their prices.
        Oletros 12y ago
        http://www.justice.gov/atr/cases/f298700/298794.pdf#page=1 http://www.justice.gov/atr/cases/f298700/298794.pdf#page=1

eridius 12y ago

> Apple colluded with the publishers to set the price, and forced Amazon to sell for the same price Apple gave the publishers leverage to use with Amazon, which is a wee bit different. But I'll give you "colluded", because it doesn't really matter. I wish Google would actually find the various articles I've read in the past about this, but my recollection is that various economists have explained that this sort of "corrective measure" is actually legal and the right course of action under certain circumstances, and the ebook market (with Amazon's near-total dominance) qualifies. You say "mainly the people being screwed", but that's not true. Amazon tried to claim that prices were lower before Apple came along, but that's actually only true for some (admittedly popular) books. Prices on other books were higher before Apple. Not only that, but the low prices that Amazon was talking about was not actually a sustainable market, but instead was Amazon engaging in predatory pricing. And predatory pricing is not something that the DOJ is supposed to be in the business of defending. Basically, many people have looked at the overall book market both before and Apple entered it, and found that, when looking at the entire market instead of just e.g. the NYT bestsellers list, prices were not higher after Apple showed up. It's also worth pointing out that Apple was being accused of violating antitrust laws, which are essentially laws designed to prevent unfair monopolistic practices. It seems rather ridiculous to claim that a minority player in a market could be guilty of monopolistic practices, since that generally requires being a monopoly. It's even more absurd when one of the main goals of antitrust is to promote fair competition, and yet it was used to punish the only real competition that Amazon had in the market. Basically, the DOJ used fair competition laws to hand a government-sanctioned monopoly to a single company. --- I did a bit more digging, and what Apple was found guilty of was a "per se" violation of a horizontal price-fixing conspiracy using a series of vertical agreements. I've found a MacObserver article[1] that talks about a 30-page amici curiae brief filed by two economists explaining why Judge Cote's ruling was wrong. [1]: http://www.macobserver.com/tmo/article/economists-on-apple-ebook-antitrust-case-judge-cote-got-it-wrong http://www.macobserver.com/tmo/article/economists-on-apple-e... There's a 3-paragraph summary at that article, which should give you a good idea of what was wrong with the ruling. I've seen a number of other articles since the ruling where other economists weigh in and say essentially the same thing, but Google is still being difficult. --- Edit: One comment about this brief says that the DOJ didn't make these considerations because it found Apple to be per se liable, which is to say, the DOJ considered the actions to be illegal regardless of any possible motivation. Some of the other economists I've referred to argued specifically against this point, saying that these kinds of vertical agreements are not a violation of the per se rule and that Judge Cote royally screwed up in applying it. Of course, Judge Cote's ruling also said she would consider Apple to have been guilty under a rule of reason as well, but I find it hard to believe given how much evidence there is that Apple's actions were indeed in its own independent business interest, and that these kinds of vertical agreements and the provisions they contained are not in fact illegal under these circumstances (my understanding is basically that they can be illegal when used by a dominant player in a market, because it's anti-competitive, but when used by a new entrant in a market with an existing dominant player, they are ok, but IANAL).

Oletros 12y ago
> Basically, many people have looked at the overall book market both before and Apple entered it, and found that, when looking at the entire market instead of just e.g. the NYT bestsellers list, prices were not higher after Apple showed up. Basically, many people have looked at the 5 publishers accused of collusion and have seen that prices were higher AFTER the collusion
- eridius 12y ago
  Are you trying to claim that somehow this whole affair affected book prices for the smaller publishers that didn't have agreements with Apple? Because for both of us to be right, all the smaller publishers must have dropped their prices precipitously to offset this supposed increase across the board in the prices of the 5 big publishers.
  - Oletros 12y ago
    I'm trying to say that ebook prices from publishers other than the 5 accused are irrelevant. The fact is that the ebook average price from the accused publishers went up, it is irrelevant for that case that the total market average prices were down.
    - eridius 12y ago
      Ok, so you are saying that the price of the other publishers went down, and apparently dropped enough to offset the fact that they're, well, smaller publishers, and therefore a smaller part of the book market. I don't think that's true. I have never heard that the smaller publishers kept dropping their prices.
      - Oletros 12y ago
        http://www.justice.gov/atr/cases/f298700/298794.pdf#page=1 http://www.justice.gov/atr/cases/f298700/298794.pdf#page=1