New Details Reveal Steve Jobs Involvement Over eBook Lawsuit

Posted on May 15 2012 - 6:14am by Editorial Staff

The US DOJ last month filed lawsuit against Apple and five book publishers over ebook pricing, turning the heat to further high, according to paidContent, New York, the District of Columbia and fifteen other states have joined the e-book pricing class action suit against Apple, Macmillan and Penguin, bringing the total number of states involved so far to 31. The amended complaint, released Friday, reveals details that were previously redacted, including an e-mail from Steve Jobs.

This is what Jobs wrote in the e-mail:

As I see it, [Conspiring Publisher] has the following choices:

  • Throw in with Apple and see if we can all make a go of this to create a real mainstream e-books market at $12.99 and $14.99.
  • Keep going with Amazon at $9.99. You will make a bit more money in the short term, but in the medium term Amazon will tell you they will be paying you 70 percent of $9.99. They have shareholders too.
  • Hold back your books from Amazon. Without a way for customers to buy your e-books, they will steal them. This will be the start of piracy 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 other alternatives. Do you?

The lawsuit alleges Apple and the book publishers employed an “agency model” in which publishers set their own e-book prices, rather than the traditional wholesale model in which publishers set a retail price and retailers set their own sales price. Apple, Macmillan and Penguin denied the proceedings that they had done anything wrong.

Another e-mail revealed on Friday from the previously redacted sections of the complaint points to the allegation that the five booksellers “worked together to force” Random House to drop the traditional wholesale model and adopt fixed e-book pricing, according to paidContent. Penguin CEO David Shanks sent this e-mail to Barnes & Noble’s then-CEO Steve Riggio on March 4, 2010:

Random House has chosen to stay on their current model and will allow retailers to sell at whatever price they wish…I would hope that [Barnes & Noble] would be equally brutal to Publishers who have thrown in with your competition with obvious disdain for your welfare…I hope you make Random House hurt like Amazon is doing to people who are looking out for the overall welfare of the publishing industry.

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