Apple Cuts DOJ's Antitrust Lawsuit to Shreds [Fortune]

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Posted May 26, 2012 at 3:46pm by iClarified

Apple's response to a Department of Justice lawsuit that alleged e-Books price fixing cuts the government's case to shreds with precision, according to CNN FORTUNE.

Apple describes the Justice Department's allegations "absurd" and "fundamentally flawed," accusing them of "ignoring inconvenient facts" and siding with monopoly rather than competition.

The Government starts from the false premise that an eBooks "market" was characterized by "robust price competition" prior to Apple's entry. This ignores a simple and incontrovertible fact: before 2010, there was no real competition, there was only Amazon. At the time Apple entered the market, Amazon sold nearly nine out of every ten eBooks, and its power over price and product selection was nearly absolute. Apple's entry spurred tremendous growth in eBook titles, range and variety of offerings, sales, and improved quality of the eBook reading experience. This is evidence of a dynamic, competitive market. These inconvenient facts are ignored in the Complaint. Instead, the Government focuses on increased prices for a handful of titles. The Complaint does not allege that all eBook prices, or even most eBook prices, increased after Apple entered the market.

FORTUNE editor Philip Elmer-Dewitt says he hasn't "had so much fun reading legal documents since the Watergate trials" and suggests that the government "may regret trying to make its e-book antitrust suit stick to Apple."

Last month, NYU law professor Richard Epstein also declared that the Department of Justice's antitrust suit against Apple and publishers over e-Book pricing is a mistake.

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Apple Cuts DOJ's Antitrust Lawsuit to Shreds [Fortune]

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Russell - May 27, 2012 at 7:01am

I am glad the DOJ is bringing a case against Apple. The case has nothing to do with getting textbooks published electronically, but with Steve's anticompetitive practices.

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Karim - May 27, 2012 at 11:43pm

Russell, Apple may be anti competitive is some areas but in this case Apple introduced competition.

Russell - May 28, 2012 at 6:05am

Anticompetitive practices are illegal, period. Antitrust laws have the basic objective: to protect the process of competition for the benefit of consumers, making sure there are strong incentives for businesses to operate efficiently, keep prices down, and keep quality up._ Apple colluded with publishers to increase prices for consumers. Apple and publishers are guilty, period.

Karim - May 28, 2012 at 6:54am

Well I'm glad that's settled. The DOJ and Apple can pack up their bags and go home now it "settled". Or we could wait for the court to "settle" it first.

tdtran1025 - May 26, 2012 at 5:21pm

I am usually in favor of some mild and absolutely minimal regualtion, but in this case the goverment is wrong, especially when there to be a need to get all textbooks published electronically.