Canadian media tries to pile on Apple, iBooks pricing-gate

Absent any actual federal action to glom onto, Canadian media decided to get in on the Apple iBook price-fixing headline game in a more creative, almost desperate way.

Like antitrust lawsuits launched by the Department of Justice in the U.S. and the European Union, the Quebec suit claims that Apple colluded with book publishers to artificially set electronic book prices higher than the $9.99 standard Amazon had set for most of its electronic books.

How is a U.S. government investigation anything like a local class-action lawsuit that doesn't even seem to have been granted class-action status yet? The former is a big deal. The latter is absolutely nothing. I'm pretty sure if we look hard enough we'll find dozens if not hundreds of dozens of people hoping to sue Apple for all sorts of reasons -- "I was psychologically damaged for life! I mean... the logo has a bite out of it! A BITE!"

If my home and native land decided to go after Apple the way the U.S. Department of Justice did, I could see the parallel. But one lawyer, in one province, who doesn't even have one lawsuit underway yet...? Not a story.

Call me when the Mounties are riding on Cupertino.

Now excuse me while I go pay almost $1.50 a liter for gas so I can get the movie theater and drop $12 for a ticket. (If only Apple were behind those prices, maybe they could get some attention...)

Source: The Montreal Gazette

Rene Ritchie

Editor-in-Chief of iMore, co-host of Iterate, Debug, Review, Vector, and MacBreak Weekly podcasts. Cook, grappler, photon wrangler. Follow him on Twitter and Google+.

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Canadian media tries to pile on Apple, iBooks pricing-gate

36 Comments

I'm not sure what the issue is here. I went to Barnes and Noble and bought a Stephen King book, remember those? Actual books? It was 7.99. That exact same book on iBooks was the exact same price, 7.99. Doesn't sound unreasonable to me.

It makes no difference whether the price of ibooks are the same as a physical book.
This is about price fixing. It's a violation of the Sherman Act Price to enter into an agreement, be it written, verbal, or inferred from conduct, among competitors that RAISES, LOWERS, or STABILIZES prices or COMPETITIVE TERMS.
all the talk about costs or making an ebook vs physical book, that some people are willing to pay more or are not are not pertinent. It's people talking about issues not relevant. You can't make agreements with competitors about what prices you'll will or won't charge. Simple as that. So the issue is, one, was there an agreement, written or otherwise. And did it lay out prices or terms for pricing of ebooks.

It depends what you mean by "distribution model." For example changing from distributing a movie on dvds to distributing movies only in theaters or only through streaming services like netflix would qualify as changing a "distribution model." But that alone isn't an agreement to keep a price. That alone wouldn't be price fixing. The problem is that's not what's alleged here. The government is alleging Apple made formal agreements to keep prices in a certain range. That it happens in the context of selling ebooks doesn't matter. That wouldn't negate that they entered into agreements that are unlawful. Alleged agreements obviously. But what causes prices to go up would be an issue settled by a court. That is one side, apple would argue, "hey they just went up, it's a natural part of the market, blah blah blah." And the prosecuter would rebut saying, "no they made an agreement to keep the price in this range and here is the evidence." Then they'd bring in economists and call people who had meetings between companies, they'll present the meeting notes from meetings, and put people on the stand that were at the meetings, not to mention they'll just submit the actual agreements entered into.
But prices can go up for law full reasons, inflation, rising costs, scarcity like after the Japan quake. And they go down for lawful reasons, economies of scale, costs savings, buying in bulk. But what some companies do is lower prices so that no competitors can enter into a market or they'll raise them when they have a monopoly. And it enters into the unlawful area when companies start agreeing to move prices around. But whether they actually made an agreement? That's what the case is likely to turn on.

Perhaps it should cost more. Greater convenience. You can get it instantly online, no tax, no fuel to waste going to brick and mortar store, no book case needed, easier to transport....

I don't know about the U.S., but here in Canada, we are charged Tax for purchase made on iTunes. Also, ebook reading on an iPad is not the same as the real thing. Convenience is well and good, but it shouldn't be similarly priced.

Why does your ideology seems insane to me? There is no printing, shipping, and distribution price that the publisher has to cover save for maybe the upkeep of a server which I'm sure is what is covered in the percent that is taken when is sale is made. There is no work to transfer it to digital as most authors submit their work digitally anyway. I'm sorry but I don't get how you can ask them to charge more. There is zero reason. All of the money that they are saving because there is no actual book to make should mean that the product is cheaper.

Production costs have nothing to do with pricing; demand does. Just because x is cheaper to ptoduce than y doesn't mean x will sell for less.

Absurd. Production cost has more to do with pricing than demand, this isn't a concert ticket. Do the prices of books skyrocket once the title become very popular?

That's not strictly true. Yes, there is no cost for printing, storage, or distribution. The those are not the largest part of the price of publication. There are plenty of other costs that remain the same: the author, layout, photography (if needed), editing, etc. And, while authors do submit their work electronically, the format required for layout of a print book is very different from that required for any kind of electronic publication. So if the book is both printed and published electronically, the layout needs to be done twice.

should be noted this isn't about whether the price was too high or too low. It's about was an agreement made to set a price or terms for pricing. Not was that price gouging. In fact it would be a violation to merely agree to sell it for one penny or one million dollars each. They are both illegal because it's the agreement that's the big issue not the price. Big picture customers don't benefit from these agreements and that's why they are outlawed.

My god Rene, I don't think we usually see eye to eye but that last line nailed it! You forgot to mention cheese, eggs and milk, though, which are always at least 50%+ more than in the states (as is basically everything...).

Rene, I use the movie comparison all the time and I think it's a good one. I don't get why people will pay the price of a movie ticket without (much) complaint, for which they get 2ish hours of entertainment, yet complain if an ebook, which will entertain possibly for days (for some people weeks) and be around to access later is priced at $10-13.

I feel like it's a bad practice to use one bad price to justify another. That's why I still have a problem paying 3-4 USD per gallon of gas even though it's even worse in some other places. That doesn't make my price any better, it just means that I'm not alone. 12 dollars for a single ticket to see a movie is ridiculous, but it's a price that has to be paid to see it on a better screen, with better sound, the first day it is available. Paying that doesn't mean that you should be willing to pay 20 dollars for a loaf of bread "just because you pay too much for other things"

If it is not a story, why post about it and make it a story? You just could not resist defending Apple once again, could you?

Furthermore, I can't remember when I last saw such a biased article.
"Absent any actual federal action to glom onto, Canadian media decided to get in on the Apple iBook price-fixing headline game in a more creative, almost desperate way."
And your providing this as news is better how?

It's not a good look to be so in love with a tech that the ability to give it objective coverage is lost. I noticed Gruber recently started posting stories that put Amazon in a bad light. The audacity to go against the beloved Apple, who cares if you are in the right.

At $4 a gallon, the price per liter for US citizens turns out to be approximately $1.06 per liter. With the US and Canadian dollar at near par, that means US citizens are still paying around 44 cents a liter less than Canadians. So how are Canadians getting a better deal?

Classic "ooh ooh look there are problems over here" to misdirect from the bad (illegal) behavior at hand.

Geez everyone just loves to pile on... If you don't like the price, don't buy it! Whatever reason you have to complain, just remember that you have a choice. There's always iBooks, amazon, or just stick with paperback. Decide what is best for you, do it, and quit complaining. Its not like buying books is a government subsidized monopoly like power, sewage, or water. Oh wait, thats the purpose of this whole lawsuit right? Thanks for coming capitalism, hope you loved it while it lasted.

Rene: Apple/iBook, maybe Apple-iBook but NEVER Apple,iBook. Commas SEPARATE sentences. It's not clear what you mean.

Of course, you do as you wish, I just meant to help. So it doesn't look like "Canadian media tries to pile on Apple. iBooks pricing-gate. But, again, it's your blog.

I don't think Apple had anything to do with this pricing collusion. I think Apple agreed to the agency model to get the first few companies on board with iBooks, but threw in the clause stating they couldn't sell for less elsewhere so they they would be on a level playing field with amazon. My assumption is the companies that immediately settled were the ones colluding, while the others came along and merely signed the same kind of deal that was already in place, and that's why they didn't settle. Everybody knows Apple likes to set their own prices. They probably figured this would happen eventually and give them back pricing control. I expect price wars with amazon to get very competitive in the future.

What about the almost €2.00/liter (US$2.63) that we pay in Italy?
Anyway, I think that ebooks should definitely be cheaper than regular books as well. As others said there's no printing, no delivering costs, no cover and no reason why they should have the same price.

Do Americans ever wonder why they have the reputation that they do?
Seeing it in writing provides the proof and it spreads so far on the Internet...

lol, Trent can't math. 1.5 * 3.79 = 5.69 CDN in USD is 5.73 USD per gallon. That's considerably more than the $4/gallon you just bitched about. Additionally, I just paid $3.49 yesterday. While I still think this price is ridiculous, I feel that they've got it way worse than we do.

You guys at iMore.com are so biased. It bothers you if anyone speaks against Apple. Just because you like their products does not mean you need to support price fixing.

Can we all please, please, please stop referring to anything remotely resembling a "scandal" as blahblah-gate. Antennagate, Heatgate, and now pricing-gate? Really?
The Watergate was the name of a hotel, nothing more.

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