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Department of Justice sues Apple and 5 major publishers over e-books

Ipad_ibookstore_apr2012

The Department of Justice has filed suit against Apple and five of the six major publishers over colluding on the price of e-books. The Wall Street Journal, which has obtained copies of the documents filed in federal court in Manhattan, reports that the lawsuit '"alleges Apple and the publishers reached an agreement where retail price competition would cease, retail e-books prices would increase significantly and Apple would be guaranteed a 30% 'commission' on each e-book sold."

Simon & Schuster, HarperCollins, Hachette, Penguin and Macmillan are the five publishers that teamed up with Apple when it launched the iBookstore with the iPad in 2010. The partnership included a shift in pricing from publishing classic wholesale/retail model to the agency model, which Apple uses in iTunes, its music store.

At the time, Random House, the world's largest publisher, did not participate, and its books were not available in the iBookstore -- it joined a year later. Random House is not expected to be named in the suit.

Atty. Gen. Eric Holder and the head of the Justice Department's antitrust division, Sharis Pozen, are expected at a news conference in Washington for 9 a.m. PDT that will announce "a significant antitrust matter."

RELATED:

Steve Jobs says publishers are "not happy" with Amazon

Random House will adopt agency model

How the iPad is shaking up publishing

-- Carolyn Kellogg

Photo: An iPad displays the Apple iBookstore. Credit: Carolyn Kellogg

 
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