Peter Kafka

Recent Posts by Peter Kafka

Apple, Book Publishers Face European Antitrust Probe

Apple’s entry into the e-book business hasn’t been a huge success, but it has still registered with European antitrust regulators. They’ve started a formal investigation that is supposed to determine whether the company and five major publishers “engaged in anti-competitive practices.”

A press release from the European Commission doesn’t provide much detail into the probe, which will look at Apple along with Lagardère Publishing’s Hachette Livre, News Corp.’s HarperCollins, CBS’s Simon & Schuster, Pearson’s Penguin and Germany’s Verlagsgruppe Georg von Holtzbrinck (News Corp. also owns this Web site).

The EU says it will “investigate whether these publishing groups and Apple have engaged in illegal agreements or practices that would have the object or the effect of restricting competition.”

It also says it will look at the “agency” pricing agreements that Apple pushed through when it introduced the iPad back in 2010. Those deals allow publishers to set the retail price of their books, and give retailers like Apple’s iTunes a set percentage of the transaction.

The previous wholesale model, championed by Amazon, allowed retailers to set the price of books. After a series of high-profile negotiations, Amazon has moved to the agency model as well; the e-commerce giant still dominates the e-book market.

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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work