US sues over e-book price fixing
Published 12/04/2012 | 08:00
Computer giant Apple is being sued for e-book price fixing by the American government.
It has filed an anti-trust lawsuit in New York against the company and various major book publishers. It claims the publishers conspired with Apple to raise retail electronic-book prices to limit competition.
The lawsuit was filed in federal court in Manhattan. It said the effort was a response to the success Amazon had in selling e-books for just under $10.
The lawsuit said the conspiracy came as Apple was preparing to launch the iPad and gave Apple a guaranteed 30% commission on each e-book it sold.
At the heart of the e-book pricing debate is the industry's continuing concerns about Amazon.
Publishers see the "agency model" as their best, short-term hope against preventing the online retailer from dominating the e-book market and driving down the price of books to a level unsustainable for booksellers.
Since launching the Kindle in 2007, Amazon has made a point of offering best-sellers for $9.99 in the US. The discount is so deep from list prices of $20 and more that it is widely believed Amazon is selling the e-books at a loss as a way of attracting more customers and forcing competitors to lower their prices.