Amazon and five of the major publishers have just won a lawsuit that was filed against them for fixing the prices of ebooks. According to the plaintiffs, Amazon commands 90% of retail e-book market in the United States and 50% of print trade book sales.
Consumers accused the defendants of signing agreements that let the publishers inflate e-book prices by locking in a 30% “agency” fee for Amazon on each sale, and guaranteeing that Amazon’s prices would not be undercut. Retail booksellers, meanwhile, alleged that Amazon had been awarded a “discriminatory discount” on hardbacks, paperbacks and mass-produced books, forcing them to pay higher wholesale prices to the publishers and depressing book sales.
There were two lawsuits filed against them and the main reason why Amazon and the publishers won, was due to a lack of evidence of collusion. U.S. Magistrate Judge Valerie Figueredo said there was “no plausible explanation for why the publishers would have been motivated to participate in a conspiracy that further entrenched Amazon’s dominance as an e-book retailer.”
From the outset of the case, lawyers for Amazon and the publishers have insisted the alleged conspiracy was “irrational” and “implausible” and that there was simply no evidence to suggest collusion of any kind. “I would submit to your honor that it is absolutely irrational for the publishers to enter into a conspiracy to make Amazon a monopolist in the retail market,” Amazon lawyer John Schmidtlein told the court at the hearing, with Scott Lent, arguing for the publishers, that there was simply no evidence showing there was “a meeting of the minds” among the publishers to collude with Amazon—and no “coherent theory” behind the case.
Michael Kozlowski has been writing about audiobooks and e-readers for the past twelve 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. He Lives in Vancouver, British Columbia, Canada.