Apple, Two Publishers Resisting E-Book Price Settlement
April 6, 2012

Apple, Two Publishers Resisting E-Book Price Settlement

Apple and a pair of publishers, Pearson and Macmillan, are apparently reluctant to agree to the terms American and European antitrust authorities are pursuing as part of an e-book price-fixing investigation, Reuters and the Wall Street Journal have reported.

According to WSJ writers Thomas Catan and Jeffrey A. Trachtenberg, the situation was "fluid" as of Thursday morning, and could change as the US Department of Justice inches closer towards filing an antitrust lawsuit in the case. They add that while the terms of the settlement had yet to be finalized, that "early indications suggest they could have broad repercussions for the fast-growing e-book market."

"A settlement would likely involve tearing up contracts the publishers signed with Apple when it first introduced the iPad tablet computer in 2010, according to the people familiar with the matter," they added. "Publishers who sign on to the settlement would likely have to let market leader Inc. resume discounting their e-books, a practice they dislike. It is unclear whether books by publishers who settle with the government would continue to be available on the iPad, and if so at what price."

Bloomberg's Andy Fixmer and Sara Forden, citing an anonymous source, said that Simon & Schuster, HarperCollins, and Hachette Book Group are close to settling the matter. However, Justice Department officials may delay the settlement until they can get Macmillan and Pearson's Penguin Group to agree to the terms, they added.

The publishers are hoping to avoid a court battle with the federal government, according to Bloomberg, and the potential settlement would allow other e-book retailers, including, to begin offering lower prices for the digitally downloadable version of books. Fixmer and Forden say that in order to compete, Apple may either stop selling books, or match the price reductions, which in some cases could result in losses for each sale.

The Justice Department declined Reuters request for comment on Wednesday. Likewise, Fixmer and Forden attempted to contact DOJ spokesman Gina Talamona, Apple spokesman Tom Neumayr, and spokeswomen from Macmillian parent company Verlagsgruppe Georg von Holtzbrinck GmbH and HarperCollins. All of them declined Bloomberg's request for comment.