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Technology Stocks : Apple Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Sr K who wrote (130680)	4/11/2012 1:23:15 PM
From: clean86	Read Replies (1) \| Respond to of 213176

Yes but Apples 30% was for their hardware support, client base and handling all the transactions of the sale. My guess is Apple will settle with no admission of wrong doing especially since 3 of the 5 Publishers already rolled over. The Government lawyers will get paid and the consumer will get something small so those lawyers can say look what we're doing for you.

To: Sr K who wrote (130680)	4/11/2012 2:43:00 PM
From: Cogito	Read Replies (2) \| Respond to of 213176

>>With Apple's standard pricing, they would have gotten 30% of $9.99 with the Amazon model, but they pushed for publishers and authors to have more say on pricing, with a result that Apple would get 30% of $12.99 (and higher). Apple gets 30% of the incremental $3.00, or 90 cents higher than they would have gotten with $9.99 sales. From Apple's POV and possibly DOJ's, it is that $.90 that is Apple's price-fixing compensation. << Under the agency model, the publishers set the book prices. Apple's only interest was in not being undersold. So the publishers agreed not to sell the books for lower prices in other outlets. Another point that seems to be missed, continuously, is that the 30% cut Apple takes doesn't generate significant profits for them. It covers their costs in maintaining the online store, credit card processing, administration, etc.

To: Sr K who wrote (130680)	4/11/2012 11:06:07 PM
From: JP Sullivan	1 Recommendation Read Replies (1) \| Respond to of 213176

The publishers are unhappy with amazon's pricing, not because they are getting less money -- as I understand it, amazon actually sells at a loss -- but because it "cheapens" the product. It's like Neiman Marcus buying Louboutin shoes for say $800 and selling them at half the price. Louboutin still gets its money but I don't think it would be too happy with the arrangement. Most luxury brands are fanatical about controlling their prices as price implies exclusivity and preserves snob appeal. I'm not saying books fall into that category, but the sentiment is still there. Most of the time vendors rely on retailers' desire to make money on products -- buy low, sell high. But then you get amazon whose intention is to lure customers to buy other (profitable) stuff by selling some items at a loss (buy high, sell low). Thus, while a publisher is happy to sell its books to anyone as long as it gets paid, over time, the public will come to expect the $9.99 price (or whatever low price amazon sets) to be the norm and start rejecting higher prices. This will diminish the publisher's ability to price its books, especially the physical copies, higher in the future. -we-