EU, publishers near deal in e-book pricing probe

Sep 19, 2012
A woman tests an e-book app on an Apple iPad at the Leipzig Book Fair in March 2012. European regulators say they are nearing a deal with giant publishers accused of e-book price fixing, weeks after media giants including Apple sealed a deal in the United States.

European regulators said on Wednesday they were near a deal with giant publishers accused of e-book price fixing, weeks after media giants including Apple sealed a deal in the United States.

The said it was "inviting comments from interested parties" on commitments proposed by Simon & Schuster Inc., HarperCollins, Hachette Book Group, and the owners of Macmillan and Apple.

The aim was to "alleviate concerns that these companies may have engaged in an anti-competitive concerted practice affecting the sale of e-books."

US prosecutors announced on August 30 that the top three US publishing houses had inked a $69 million deal to close the book on charges that they had schemed to fix prices of digital titles.

In the US case, readers will get compensation if they bought at prices found to be unduly high owing to collusion between publishers and iPad developer Apple.

The US lawsuit alleged that the publishers had conspired with Apple to end the longstanding "wholesale model" in which e-books were sold to retailers which had the power to set their own prices.

They replaced this with a so-called "agency model" whereby publishers would set prices charged by retailers for the e-books. Under the arrangement, Apple was guaranteed a 30-percent commission on each e-book sold.

"The agency model allows more control by publishers over retail prices," the EU regulators said.

Before the introduction of Apple's iPad, online retail giant Amazon sold electronic versions of many new bestsellers for $9.99.

After the agency model was adopted, prices rose to $12.99 and higher, the case suit said, and price competition among retailers was "unlawfully eliminated."

In the , the defendants agreed to compensate e-book buyers to resolve antitrust claims.

Now in Europe, the five companies have offered to terminate the sale of e-books through these "agency contracts" and refrain from adopting disputed price clauses for five years.

In line with the US lawsuit, the Commission had concerns that the switch to this model, as opposed to a traditional wholesale approach, "may have breached EU antitrust rules that prohibit cartels and restrictive practices."

It may further "have been the result of collusion between competing publishers, with the help of , and may have aimed at raising retail prices of e-books (in Europe) or preventing the emergence of lower ," a statement said.

US prosecutors cited evidence showing that prevented retail price competition, resulting in buyers paying tens of millions of dollars more for e-books.

Brussels added: "If the market test confirms that the commitments are suitable to address the Commission's competition concerns, the Commission may make them legally binding on the companies."

Interested parties have one month to make submissions.

Explore further: Twitter looks to weave into more mobile apps

add to favorites email to friend print save as pdf

Related Stories

US judge OKs partial settlement in e-book case

Sep 06, 2012

A US judge approved a partial settlement Thursday in a lawsuit over e-book price-fixing, allowing three publishers to end a deal with Apple that became the target of a government probe.

US defends suit on Apple, e-books amid criticism

Jul 23, 2012

US antitrust authorities Monday defended their lawsuit accusing Apple and major publishers of a price-fixing conspiracy on e-books, saying the action is "in the public interest."

Apple denies e-book pricing conspiracy

Apr 13, 2012

Apple denied a charge that it schemed with publishers to hike prices for e-books, portraying itself as a hero for prying Amazon's "monopolistic grip" from the market.

Recommended for you

Twitter looks to weave into more mobile apps

10 hours ago

Twitter on Wednesday set out to weave itself into mobile applications with a free "Fabric" platform to help developers build better programs and make more money.

Google unveils app for managing Gmail inboxes

11 hours ago

Google is introducing an application designed to make it easier for its Gmail users to find and manage important information that can often become buried in their inboxes.

Fighting cyber-crime one app at a time

17 hours ago

This summer Victoria University of Wellington will be home to four Singaporean students researching cyber threats. The students have been working with Dr Ian Welch, a lecturer in Victoria's School of Engineering and Computer ...

Is big data heading for its 'horsemeat moment'?

19 hours ago

There have been so many leaks, hacks and scares based on misuse or misappropriation of personal data that any thought that "big data" could provide benefits rather than only opportunities for harm may be ...

User comments : 0