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Apple: DOJ's E-Book Price Fixing Charges 'Not True'

 & Chloe Albanesius Executive Editor, News

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Apple this week denied any wrongdoing regarding the pricing structure for books sold via iBooks, arguing that its entry into the market helped collapse Amazon's monopolistic hold on the industry.

"The DOJ's accusation of collusion against Apple is simply not true," Apple said in a statement.

On Wednesday, the Department of Justice announced that it had filed suit against Apple and five other publishers over an alleged "illegal conspiracy" involving e-book price fixing. Apple, as well as publishers Macmillan and Penguin, plan to fight the charges, while Hachette, HarperCollins, and Simon & Schuster have agreed to a proposed settlement.

Beginning in 2009, publishing executives met with Apple during near-quarterly meetings to discuss competition issues, including Amazon's e-book pricing, "as part of a conspiracy to raise, fix, and stabilize retail prices," according to Attorney General Eric Holder.

Apple had a different take.

"The launch of the iBookstore in 2010 fostered innovation and competition, breaking Amazon's monopolistic grip on the publishing industry," the company said in its statement, which was first provided to All Things D and confirmed by an Apple spokesman. "Since then customers have benefited from eBooks that are more interactive and engaging. Just as we've allowed developers to set prices on the App Store, publishers set porices on the iBookstore."

The DOJ, however, alleges that Apple and publishers crafted a deal whereby no other e-book retailer could offer a price lower than Apple. Sharis A. Pozen, acting assistant attorney general within the DOJ's antitrust division, said that publishers reportedly referred to the "wretched" $9.99 pricing scheme for e-books via Amazon, and wanted to force Amazon to up its prices. Pozen quoted former Apple CEO Steve Jobs, who reportedly said of the deal: "The customer pays a little more, but that's what [publishers] want anyway."

Australia is also reportedly considering an investigation into the Apple e-book price-fixing issue.

About Our Expert

Chloe Albanesius

Chloe Albanesius

Executive Editor, News

My Experience

I started out covering tech policy in DC for The National Journal, where my beat included state-level tech news and all the congressional hearings and FCC meetings I could handle. I later covered Wall Street trading tech before switching gears to consumer tech. I now lead PCMag's news coverage.

My Areas of Expertise

Getting my start in DC means I still have a soft spot for tech policy; Congressional hearings can sometimes be as entertaining as a Bravo reality show, for better or worse. But PCMag is all about the technology we use every day, as well as keeping an eye out for the trends that will shape the industry in the years ahead (or flop on arrival). I've covered the rise of social media, the iOS vs. Android wars, the cord-cutting revolution that's now left us with hefty streaming bills, and the effort to stuff artificial intelligence into every product you could imagine. This job has taken me to CES in Vegas (one too many times), IFA in Berlin, and MWC in Barcelona. I also drove a Tesla 1,000 miles out west as part of our Best Mobile Networks project. Of late, my focus is on our hard-working team of reporters at PCMag, guiding and editing their robust coverage.

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