The US Department of Justice Files Antitrust Lawsuit Against Apple (Updating)

Illustration for article titled The US Department of Justice Files Antitrust Lawsuit Against Apple (Updating)

According to Bloomberg, the U.S. DOJ just filed an antitrust lawsuit against Apple over the pricing of eBooks. Publishers Hachette, HarperCollins, Macmillan and Penguin were also named in the lawsuit too.

The lawsuit was filed because the Department of Justice thinks publishers and Apple have colluded against Amazon and other retailers by setting the price for e-books (as opposed to letting those retailers set the price). Apple's deal with publishers, as you may know, lets the publishers set the price for e-books (with a lowest-price guarantee) in Apple's iBooks store with Apple getting a 30% cut on sales. If the DOJ wins the anti-trust lawsuit against Apple, Apple would lose the low-price guarantees it has with publishers for its e-books and the whole e-book pricing system would move toward the 'wholesale model', where retailers like Amazon could charge whatever they want.

As of now, Apple has not participated in any settlement talks with the DOJ so it might be looking to fight this out in court. It could get ugly. [Bloomberg]

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I love the irony of the gov't protecting Amazon's 80% market share by filing antitrust charges agains their competitors.