Earlier this morning the United States Supreme Court has announced that they have denied Apple’s request for an appeal of the e-book anti-trust case. The courts decision brings to an end a multi-year courtroom saga that had major publishers and Apple colluding to fix e-book prices. Apple now has to pay $400 million in damages and $50 million in court fees.
Within the next 60 days more details should emerge on how Apple is going process e-book refunds to consumers. It is very likely that they will adopt the same model as Amazon, Barnes and Noble and Kobo employed when they reached a settlement with major publishers. Apple should be offering $0.73 for a backlist title and around $3.06 for a recent bestseller. The refunds will only be granted if you purchased an e-book from Hachette, HarperCollins, Simon & Schuster, Penguin or Macmillan between April 1, 2010 and May 21, 2012.
Barnes and Noble is a publicly traded company and when they offered refunds to customers close to 72% of the credits offered were redeemed to purchase digital content. If customers redeem 72% of the Apple bonanza — $288 million — and a full 70% of that amount goes to the publishers’ share of e-book purchases, that would send about $200 million to publishers for e-books. That’s on the order of 15% of the entire AAP-reported e-book market for 2015.
The Apple credits could’t have come at a better time for the digital publishing industry. Nielsen and the Association of American Publishers have all proclaimed that e-book sales have fallen 11% in 2015, primarily due to the rising cost due to agency pricing. You can now buy a month old hardcover cheaper than an e-book.
It is important to note that e-book credits are not perpetual and have a limited window from when they are issued to when they expire. Within the next 60 days we will write a followup story that documents what you need to know to redeem your Apple e-book credits.
Michael Kozlowski is the Editor in Chief of Good e-Reader. He has been writing about audiobooks and e-readers for the past ten years. His articles have been picked up by major and local news sources and websites such as the CBC, CNET, Engadget, Huffington Post and the New York Times.