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Apple to Pay E-Book Readers $400 Million in Antitrust Settlement

Apple to pay $400 million in e-book anti-trust settlement - peoplewhowriteUnless an appeals court overturns a July 2013 ruling that Apple conspired with publishers with the aim of compelling Amazon to price their books at an advantage to publishers, Apple will have to pay  “$400 million to consumers in cash and e-book credits, and $50 million to lawyers” according to the New York Times.

The NYT piece explains:

The government’s lawsuit focused on 2010, when Apple entered the digital book industry with the introduction of the iPad and the iBookstore. At that time, publishers’ agreements to sell e-books were made under the so-called wholesale model of print books; publishers charged retailers about half the cover price for a book, and the retailers then set their own prices.

But with the iPad and iBookstore, Apple offered publishers a new business model. The government said Apple’s co-founder and then chief, Steve Jobs, persuaded publishers to agree to the so-called agency model for selling books, which let publishers set their own prices for e-books.

Pursuant to the verdict, Amazon notified Kindle readers they could expect a credit for some past e-book purchases. The appeals court date is scheduled for December 15, 2014.

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