This week Apple responded to the DOJ e-book antitrust charge by throwing down the gauntlet. Basically they ripped apart each and every one of the DOJ charges against Apple. Their first shot was directed against the DOJ contention that before Apple entered the e-book market it was a market with a “robust price competition”. Apple was quick to point out in their response that at the time Apple entered the market Amazon sold 90 percent of all e-books. This, according to Apple clearly shows there was no pricing competition in the e-book market prior to their entry.
Apple had no problem throwing the publishers under the bus when they stated if there was any conspiracy by the publishers, Apple had nothing to do with it and in fact had no knowledge of it. Apple said that the DOJ is concentrating too much on the increase in price and does not give enough credit for the growth in the number of e-book titles, and the types of e-books that are now available since Apple entered the market. The introduction of the iBook allowed for features such as color pictures, videos and audio innovations that were not available through the Amazon Kindle. Apple said that the DOJ offers no proof that the agency model that Apple uses harms the consumer. That there was and is nothing illegal about this model and that it has been around for quite a while.
Now that the first salvos by both sides have been fired, it is clear that this maybe a long battle. The US District Court has refused to throw out the class action suit brought by 31 states in a case similar to the DOJ. Apple continues to stand its ground and all indications are that it has no intention of backing down. Apple clearly has the money and the will to fight the case as far as it will go. This is one case where the consumer could end up losing no matter how the case goes. There is no doubt that the introduction of the iBook has forced the e-book market to innovate. However this same innovation has also caused the rise in the price of ebooks.