Justice Department To Sue Apple and Major Publishers

iPadThe fallout from the implementation of the agency model for ebook selling hasn’t died.  Today, the Wall Street Journal says that the US Justice Department is going to sue Apple and five major book publishers.

The five publishers facing a potential suit are CBS Corp.’s Simon & Schuster Inc.; Lagardere SCA’s Hachette Book Group; Pearson PLC’s Penguin Group (USA); Macmillan, a unit of Verlagsgruppe Georg von Holtzbrinck GmbH; and HarperCollins Publishers Inc., a unit of News Corp. , which also owns The Wall Street Journal.


The case centers on Apple’s move to change the way that publishers charged for e-books as it prepared to introduce its first iPad in early 2010. Traditionally, publishers sold books to retailers for roughly half of the recommended cover price. Under that “wholesale model,” booksellers were then free to offer those books to customers for less than the cover price if they wished. Most physical books are sold using this model.

There are several proposed ideas for settling the matter.  One idea is “to preserve the agency model but allow some discounts by booksellers” but it’s unclear how that would work.  Another idea is delaying the release of digital versions after the publishing of the printed version.

Read the article U.S. Warns Apple, Publishers.