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Wednesday, April 11, 2012

The Government Killing Competition?


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Macmillan Publishing CEO, John Sargent:
"It is also hard to settle a lawsuit when you know you have done no wrong. The government’s charge is that Macmillan’s CEO colluded with other CEO’s in changing to the agency model. I am Macmillan’s CEO and I made the decision to move Macmillan to the agency model. After days of thought and worry, I made the decision on January 22nd, 2010 a little after 4:00AM, on an exercise bike in my basement. It remains the loneliest decision I have ever made, and I see no reason to go back on it now.
I hope you will agree with our stance, and with Scott Turow, the president of the Author’s Guild, who stated, “The irony of this bites hard: our government may be on the verge of killing real competition in order to save the appearance of competition. This would be tragic for all of us who value books and the culture they support”.
This is in reference to a recent Eric Holder; U.S. Attorney General led case against Apple Computer and most every publishing company for price fixing on their iBooks ebook store. The real irony is that before Apple entered the market, Amazon dominated with it's Kindle ebook store because they had no competition. Apple entered the market with higher prices and Amazon responded with higher prices as well. The twist … Amazon had been losing a few dollars on 1000's of ebooks for months ~ just so no one  small could compete.

The government in the meantime portrays this as Apple price-gouging the consumer.

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