back to article Penguin gives in to US Feds over ebooks

Penguin has caved in to the US Justice Department, agreeing to a settlement over alleged price-setting of ebooks after holding out since April. Three of five publishers that the Justice Department accused of conspiring with Apple over ebook pricing have already settled. Penguin's capitulation leaves just one publisher, …


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  1. Anonymous Coward
    Anonymous Coward

    "The giant etailer had been selling ebooks at cost or below to push sales of its Kindle ereader and gain brand loyalty to dominate the growing market. "......till Apple came along and colluded with the publishers to FIX the price of ebooks (which are now more expensive than paper (don't mention VAT please, this was obviously taken into account)).

    Very ethical! If Apple were a person, i'd keep it away from the kiddies!

    1. wowfood

      Agreed on the stupidity of ebooks costing more than paper backs. I'd much rather have books in ebook format (no space on the book shelf) but I just can't afford it, I go to an etailer and see the ebook version for 20% more than the paperback and I just think "I'm not paying that"

      If anything I'd expect ebooks to be 20% cheaper than paperback versions. Of course by business logic to see that happen, the publishers would just jack up the prices of their paperbacks by 40% and keep ebook prices static.

      1. Anonymous Coward
        Anonymous Coward

        Greed and stupidity.

        The book world version of hollywood accounting.....

        Dammit - go to the free / shared / friends ebooks... join a book club and everyone buys one ebook, and every week, all 200 members swap ebook readers.

        Fuck them.

    2. vic 4

      selling ebooks at cost or below

      A new cunning way to avoid paying tax?

  2. frank ly

    This sounds weird

    Penguin have been fighting it in the USA since April and have just capitulated. But in Europe, Penguin are still fighting.

    Apple and MacMillan have capitulated in Europe but are still fighting it in the USA. The others caved in early, in the USA and Europe.

    Do they all have some kind of multi-dimensional magic spreadsheet that tells them when to stop fighting and when to carry on, in different jurisdictions? Maybe it works with profit forecasts, legal costs, regulatory fines, notional PR and goodwill values etc., then tells them the best date to give in?

    1. Anonymous Coward
      Anonymous Coward

      Re: This sounds weird

      Nah., much easier, they simply all got together to decide on how much they will pay in legal fee's and who fights in each jurisdiction.

    2. Tom 13

      Re: This sounds weird

      It's not so much a date as a financial limit factored with legal advice, and it applies to all sides. If it is only going to cost $100,000 to fight a $4 million fine with a high chance of winning, you do it. When you get to $1 million to fight with a $2 million fine and a low chance of winning, you may change your tune if you can cut a deal where you don't admit guilt to make it all go away. When the numbers are equal, it's time to cut your losses. The numbers will differ depending on region. The tricky part is, the government is running a similar calculation based on their budgets, and you need to factor that into your plans as well. Remember, for a business, it's not so much about right or wrong, it's about the dollars, pounds, Euros, etc. (depending on localization).

  3. Robert Helpmann?? Silver badge

    Make It Stop!

    The people making the sort of decision leading the collusion are effectively insulated from any consequences on one hand and have a lot of personal financial incentives to maximize profits through collusion. Is it any wonder this sort of behavior is rife throughout the publishing industry (as well as others)? It seems obvious that attacking the problem at either of these points will slow or eliminate it. Prosecute the individuals responsible for price fixing along with the companies they represent. Give the former jail time and confiscate all profits on the items involved from the latter. Draconian? Yes. Effective? Look up Draco.

  4. h3

    The publishers screw over the authors.

    Amazon screws over the publishers.

    Apple screws over the customers.

    (That is why I prefer Amazon - I don't care one bit about the middle men. (Be they record labels / Publishers).

    Quite like Baen Books and don't mind Oreilly as far as publishers go. (The ones I like least are the ones selling textbooks).

  5. graeme leggett

    What price discount in an electronic marketplace

    When dealing with physical items, the purpose of discount is clearer, a wholesaler agrees to take a palletload of stuff with associated reducing packaging and processing costs compared to the ones and twos going out to the retailer and the manufacturer gets a quicker payment but at a lower return.

    With the retailer, the discount to the customer is to clear old stock that isn't selling (remaindered bin), or act as lure to bring in footfall who might by other stuff (supermarkets)

    With ebooks where's the incentive to discount, except to lock the buyer into returning to the same (e)store next time they want a book, or to lock them into a preferred format with the same effect. An ebook doesn't take up stockroom space, the only issue for the retailer is how many concurrent purchases and downloads it can handle.

    LAst thought - with no little to no physical limit on the number of copies held, the number of available loans has to be limited to maintain the seller's market.

    1. Tom 13

      Re: What price discount in an electronic marketplace

      All of what you wrote is true, which is why I don't have a problem with Apple's 'Most Favored Nation' clause in the contract. They started with no knowledge of how to price e-books and their only concern is that they not be undercut by competitors on the price they have to pay to the publisher to buy the book. As long as they know they are making their $0.99 or $1.29 per download, they're competing on the reader and their infrastructure for supporting the downloads.

      Now, if the publishers then get together and collude to set ebook prices, that's a whole different story. Albeit much more difficult to investigate and prove.

  6. Wallyb132

    This is Apples business model...

    Poison every market it can get in to. Make it so no other company can do business in that market, let alone want to business in that market. Guarantee, by contract, that no other operation the world over will ever get a better price than you. Next it will, by contract, forbid the publishers from distributing its good thru other vendors period, once it has sufficiently dwindled down the competition to the point of irrelevance.

    The is just another example of why the people of the world need go see a doctor about a rectal cranial extraction and stop feeding the animals.

    If people would stop buying their crap, they would stop acting like they own the world.

  7. Womble Of Wimble

    Scumbag publishers

    Bring up the Bodies [Kindle Edition]

    Hilary Mantel (Author)

    Sold by: HarperCollins Publishers

    This price was set by the publisher


    Amazon Price New from

    Kindle Edition $21.14

    Hardcover $14.33


    1. Tom 13

      Re: How?

      See icon.

      They've seen what yaks like you post about the RIAA, so they're just acting pre-emptively.

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