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September 9, 2013

Final order signed in Apple ebook price-fixing case

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It could have been much worse for Apple.

Late last week, Judge Denise Cote signed the final order for injunction relief in the Apple ebook price-fixing case. Apple was found guilty of conspiring to fix the price of ebooks in July.

The injunction blocks Apple from enforcing most-favored-nation (MFN) clauses with publishers for the next five years and requires that the company be monitored by a court-appointed External Compliance Monitor for the next two years. But, while Apple’s ebook business model will certainly have to change, the company may very well be breathing a sigh of relief.

As Fortune‘s Philip Elmer-Dewitt reported last week, the injunction does not include some of the DOJ’s more painful recommendations. A few of the bullets Apple dodged, per Elmer-Dewitt:

  • Apple is not required to let Amazon and Barnes & Noble (BKS) sell books on the App Store without giving Apple it’s usual 30% cut.
  • Apple is not required to change the way it conducts negotiations for other media — TV shows, movies, music, apps, etc.
  • Although a court-appointed monitor will be overseeing Apple’s e-book negotiations for the next two years, he or she will not be looking into the rest of Apple’s business practices.

It could have been worse, but Apple still plans on appealing the injunction. Last week its spokesperson Tom Neumayr was adamant that, “Apple did not conspire to fix e-book pricing. The iBookstore gave customers more choice and injected much needed innovation and competition into the market.”

 

Alex Shephard is the director of digital media for Melville House, and a former bookseller.

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