E-books suit: Did the feds steal publishing’s future?

last updated 8 January 2015

Score one for monopolies, said Jordan Weissmann in TheAtlantic.com. When the U.S. Department of Justice announced last week that it was suing Apple and five major publishers for alleged price-fixing, consumers weren’t the big winners. Yes, the going price of many popular e-books immediately dropped from $14.99 to $9.99; “that’s the bright side.” But the outfit doing the price slashing was Amazon, a company so big that it can withstand losses on every sale until would-be competitors—and a few publishers—have withered and died. With the settlement that’s been forced on three of the publishers, the do-gooders at Justice have effectively crowned Amazon CEO Jeff Bezos “dictator-for-life” in this industry. Already, his company sells 70 percent of all e-books. In a couple of years, a reader may have no place else to turn.

Oddly, that’s where the market was two years ago, said David Carr in The New York Times. Before Apple unveiled the iPad, Amazon “had a 90 percent stranglehold on e-books,” and publishers worried that Amazon’s $9.99 price was setting a standard that eventually would make it impossible to sell any books at profitable prices. Apple altered the game by letting publishers set their own prices for e-books sold on iPads, as long as no title sold for less elsewhere. Amazon’s monopoly was briefly broken. To now mount an antitrust case against the publishers is like letting Standard Oil slide but “breaking up Ed’s Gas & Groceries” instead.

Don’t fault Amazon for playing tougher, and smarter, than everyone else, said Will Entrekin in HuffingtonPost.com. The retailer has gained dominance “not by conspiring against its competitors but by innovating.” From day one, it has offered customers good prices and a great shopping experience. Contrast that with publishers, which instead of designing their own e-readers 10 years ago clung to an outdated business model until they had no choice but to make a shady deal. For choosing “collusion rather than innovation,” traditional publishing deserves the culling to come.