U.S. Demand to Apple and Publishers for Price-Fixing of Electronic Books

The Justice Department today sued the U.S. technology giant Apple to and five of the largest publishers in the country for allegedly violating antitrust laws agreeing the sale prices of their ebooks.

According to the complaint filed with the court for the Southern District of New York, publishers Simon & Schuster, Hachette, Penguin, Macmillan and HarperCollins reached an agreement with Apple to fix the selling prices of electronic books before launch in April 2010 of the first generation iPhone.

“The continuing conspiracy of the defendants and their agreements have caused consumers of electronic books have paid tens of millions of dollars more for them than they would have paid” have not done, says the lawsuit.

The pact would have occurred in reaction to the discount policy of the online store Amazon, which since launching its Kindle electronic reader in 2007 traded recently published works and bestsellers for $ 9.99 in its digital version.

“The publishers feared that the low prices of sale of electronic books could lead to an eventual decline in wholesale prices of these books, as well as lower prices of printed works and other consequences that wanted to avoid,” says the complaint.

Therefore, those big publishing houses allegedly reached an agreement with Apple by which “the price competitiveness cease marketing”, prices would rise “significantly” and the signature of Silicon Valley would ensure a “commission” of 30% from the sale of each of these books.

To achieve this, the lawsuit, the five publishers decided to change their sales model type and replace it with a wholesale “agency”, which meant they themselves set the price at which they would have traded e-books to final consumers.

The suit cites the late co-founder of Apple, Steve Jobs, who reportedly said: “We will change to a model agency for which you pay attention, prices and we carry 30%, and, yes, consumers pay a little more, but that’s what you want anyway. ”

According to the U.S. Justice Department, the plan worked and electronic versions of books by bestselling ceased trading in its online edition at $ 9.99 for up to a range between 12.99 and $ 16.99.

The complaint concludes that consumers have had to pay “tens of millions of dollars more” for your ebooks, so claiming that Apple and publishers “restore competitiveness has been lost.”

Despite the filing of that suit against the Apple shares rose 0.18% to the average New York session at the Nasdaq Stock Market.