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Eddy Cue, Apple’s senior vice head of state in fee of web software application and services, took the stand today in the Division of Justice’s antitrust case against Apple over the price of e-books following the launch of the iBooks Shop in 2010.
Cue is Apple’s chief negotiator and was in charge of all discussions with the major book posting houses. The DoJ is alleging that Apple unlawfully dealt with publishers to artificially increase e-book rates, an infraction of UNITED STATE antitrust laws.
In testament today, Hint admitted that the costs of some e-books– consisting of many of those appearing on the New york city Times finest sellers list– did increase after the iBooks Store was opened, however it was more the result of publishers being unhappy with Amazon’s rates of $9.99 / book than anything unfortunate that Apple did.
Instead, Cue stated that prices rose because publishers ‘shared to us that they desired higher costs’. Apple’s prices model for e-books coincides agency model that it uses on the App Store– publishers set book rates and Apple takes 30 % of the profits while returning 70 % to the publishers.
He likewise stated that he did not know if publishers were collaborating on the negotiations with Apple and Amazon, however because all the publishers had problems with different components of Apple’s proposed contract Hint stated that ‘if they chatted together, I presumed it’d be much easier to obtain the offers done.’ Cue also said that he ‘hadn’t been attempting to work out’ for the entire e-book market and he was not trying to repair problems the publishers had with Amazon.