How much would it cost you to covert your hard copy to a handy digital one you can share with your other devices? Do you get 5 hard copies for $7.99?

The DoJ is actually launching a lawsuit to protect a company that is openly trying to monopolize the e-book market.  There is smart antitrust enforcement and there is dumb antitrust enforcement, this lawsuit is of the latter category.

#1 apple TODAY only has an estimated 15% of the ebook market. At the time they had 0%, and Amazon had roughly 90%. Amazon was trying to push publishers to sell books at lower and lower prices.

Apple came in and did not try to stop Amazon and other seller from selling, but they tried to help stop them selling at lower prices. This is the meat of the case. The part that I think Apple will take a hit on is the “most favored nation” clause that states that publishers couldn’t sel books to anyone for less than they were selling to Apple. That seems fishy.

What share of the ebook market did apple control before they ‘forced’ the publishers to sign these deals?

It’s not that Apple conspired to set prices.  It’s that Apple used its market position to constrain publisher’s options for selling e-books through other channels.  If you want to sell through Apple, you have to give up rights as a bookseller to do it.

For a brick-and-mortar example, suppose Bill’s Books (fictitious), which slaps a 30% surcharge on the books it sells above and beyond the rates charged by other outlets (and therefore sells for a higher price to consumers), told publishers that it would refuse to sell their books if they also sold their hard-copy books through other outlets for a lower price. No big deal, eh? Nobody’s ever heard of Bill’s Books, they can’t be very important in the market. The publishers will just say, fine, we’ll sell everywhere but through your stores. But now imagine that Bill’s Books’ market share is equal to Apple’s in the e-book market. Now Bill’s Books has the power to put the hurt on publishers by forcing them to restrain trade. The result: consumers pay more for books, and the higher price depresses sales but sends profits skyrocketing at Bill’s Books and even at the publishers, who are now charging more for their books elsewhere. It’s a kind of involuntary cartel, instigated by the unscrupulous Bill’s Books exploiting its market position to wring out more profit from consumers.

If the court finds that Apple’s contracts with e-book publishers constitute illegal restraint of trade, made possible by Apple’s very strong market position, it could find Apple in violation of anti-trust law.

I don’t know if the court *will* find Apple guilty of restraint of trade, but it’s a possibility that ought not be ignored by the pundits.

They are the reason why piracy exists.

I can buy an actual BOOK for US$7.99 – why should ANYONE have to pay ten bucks for a virtual copy that costs NOTHING to distribute?