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U.S. Senator tells DOJ to drop Apple’s eBook price-fixing suit


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Apple eBook Price-Fixing Lawsuit

United States Senator Charles Schumer (D-NY) has written an open letter to the Department of Justice, which was published by The Wall Street Journal, telling the agency to drop the eBook price-fixing lawsuit against Apple (AAPL) and two other major book publishers. Schumer warns that the suit could “wipe out the publishing industry as we know it, making it much harder for young authors to get published.” The senator also notes that ”the suit will restore Amazon to the dominant position atop the e-books market, if that happens, consumers will be forced to accept whatever prices Amazon sets.”

Schumer believes Amazon’s “monopoly in digital publishing” is not in the best interest of publishers and authors, who are forced to make a “Hobson’s choice” and settle for Amazon’s low eBook prices, thus undercutting their own hardcopy sales. Due to increased competition from Apple, however, Amazon was forced to “expand its catalog, invest in innovation, and reduce the prices of its Kindle reading devices.”

The senator argues that the DOJ has ignored the fact that the average price of eBooks has fallen from $9 to $7, and instead focused its attention on the higher prices for some new releases.

“If publishers, authors and consumers are at the mercy of a single retailer that controls 90% of the market and can set rock-bottom prices, we will all suffer,” Schumer wrote. “Choice is critical in any market, but that is particularly true in cultural markets like books. The prospect that a single firm would control access to books should give any reader pause.”

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