Wednesday June 19, 2019

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NY Sen. Schumer Asks DOJ to Drop e-Book Suit

English: Charles Schumer, United States Senato...

English: Charles Schumer, United States Senator from New York Español: Charles Schumer, Senador de los Estados Unidos de Nueva York (Photo credit: Wikipedia)

Recently the Department of Justice filed suit against Apple and major publishers, alleging that they conspired to raise prices in the digital books market. Though NY Senator Charles Schumer told the Wall Street Journal that this sounds plausible, the suit will only restore Amazon to the dominant position in e-book sales, and give the company control of book prices. Amazon took the original lead with 90% of the retail market, but declined to 60% when Apple entered and negotiated an agency model with publishers, where the publishers could establish retail prices and Apple would take a percentage. This forced Amazon to lower the prices of its products, to keep up with the competition. The Justice Department is focused on the rise of prices caused by Apple’s entrance, however the average e-book price has declined from $9 to $7.  According to Schumer this lawsuit creates and empowers monopolists and hurts the innovators.

Wall Street Journal