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Apple cofounder Steve Jobs got directly involved in an allegedconspiracy to fix e-book prices after a publisher balked atparticipating in the scheme, according to a court document filed by31 states, the District of Columbia and Puerto Rico. The document, an amended complaint to an antitrust lawsuit by the states and others against Penguin,Macmillan and Apple, was filed in a New York federal districtcourt. A similar lawsuit against the publishers and Apple has been filed by the Departmentof Justice. According to the complaint, when one of the conspiring publishersdragged its feet on entering the e-book pricing deal with Apple,Jobs was enlisted to sell high-ranking officials in thepublisher s parent company on the wisdom of the proposed pricingscheme. "As I see it," Jobs wrote, the publisher had the following choices: 1. Throw in with Apple and see if we can all make a go of this tocreate a real mainstream ebooks market at $12.99 and $14.99. 2. Keep going with Amazon at $9.99. You will make a bit more moneyin the short term, but in the medium term Amazon will tell you theywill be paying you 70% of $9.99. They have shareholders too. 3. Hold back your books from Amazon. Without a way for customers tobuy your ebooks, they will steal them. This will be the start ofpiracy and once started, there will be no stopping it. Trust me,I've seen this happen with my own eyes. "Maybe I'm missing something, but I don't see any otheralternatives. Do You?" he wrote. Within three days of the letter, the amended complaint noted, thefoot-dragging conspiring publisher and its co-conspirators agreedon an "agency" e-book pricing scheme and signed an agency deal withApple. In their complaint, the states and others allege that Apple joinedpublishers Hachette, HarperCollins, Macmillan, Penguin and Simon& Schuster in a price-fixing conspiracy and facilitated theirscheme to increase e-book prices. Apple facilitated the alleged conspiracy, the states argue, bybringing the publishers into agreement with one another on how togo about increasing e-book prices. The publishers' plan was carried out in two steps, the complaintexplained. First, the existing wholesale model for selling books --where retailers decided the price consumers paid for e-books --would be replaced with an agency model in which the publisherscontrolled the price consumers paid for an e-book. Second, retaile-book prices would be increased. As a result of the alleged conspiracy, Apple and the publishers"agreed to eliminate e-book retail price competition between Appleand Amazon and other outlets. Rather than hinder competition, Apple claims its deal with thepublishers fostered competition. "The launch of the iBookstore in2010 fostered innovation and competition, breaking Amazon'smonopolistic grip on the publishing industry," it said in astatement issued after the Justice Department filed its lawsuitagainst the company. "Just as we have allowed developers to set prices on the App Store,publishers set prices on the iBookstore," it added. However, there's evidence that the deal Apple cut with thepublishers to sell e-books wasn't as common as the high-tech firmwould like the public to believe. That agreement contains something called a "most-favored nation"clause. Typically, those clauses are included in contracts toprotect a buyer from wholesale price fluctuations. Apple's most-favored nation clause was different , according to the Justice Department. "[I]nstead of [a clause]designed to protect Apple's ability to compete, this [clause] wasdesigned to protect Apple from having to compete on price at all,while still maintaining Apple's 30 percent margin," the JusticeDepartment said in its complaint against Apple and the publishers. Follow freelance technology writer John P. Mello Jr. and Today@PCWorld on Twitter. We are high quality suppliers, our products such as Brake Band Lining Manufacturer , Viton Rubber O Rings for oversee buyer. To know more, please visits Rubber Ring Seals.
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