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DOJ To Sue Apple: Multiple Reports Say
Ironically Apple hit an all-time high Tuesday and had a market cap worth $600 billion

The Justice Department is fixing to sue Apple, Macmillan and maybe Penguin for antitrust maybe as soon as Wednesday by all reports.

The iPad-centered charges are supposed to be collusion and fixing the price of that newfangled invention, e-books.

The DOJ essentially destroyed Microsoft at the height of its powers a generation ago with its antitrust suit. Ironically Apple hit an all-time high Tuesday and for one bright shining moment had a market cap worth $600 billion.

The DOJ’s got a burr under its saddle because Apple and Macmillan won’t settle – or even talk anymore about settlement.

They deny colluding to jack up the price of e-books and are expected to argue that Apple’s two-year-old agreements with publishers were good for competition. The deals let publishers, not vendors, set the price.

That’s called the agency model and limits discounting.

Bloomberg says Washington wants a deal that would let Amazon and other retailers decide what to charge and void the “most-favored nation” clauses in Apple’s contracts requiring booksellers to provide it books at their lowest prices so Apple could reap a 30% return as opposed to Amazon, which buys at a discount and set its own cheap prices.

As has been in the news, Simon & Schuster, Hachette Book Group and HarperCollins have also been under the gun. They might settle Wednesday.

Bloomberg said e-book sales were up 117% last year to $969.9 million according to estimates from the Association of American Publishers, returning a higher margin than paper books.

The Consumer Federation of America says consumers will pay about $200 million extra for e-books this year.

People didn’t have this kind of problem when we went from the scroll to the codex.

About Maureen O'Gara
Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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