How much should an e-book cost?

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Date: January-February 2013
From: Poets & Writers Magazine(Vol. 41, Issue 1)
Publisher: Poets & Writers, Inc.
Document Type: Article
Length: 863 words

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Poetry isn't often quoted in judicial rulings, but when Judge Denise Cote of the U.S. District Court for the Southern District of New York approved the settlement of a federal antitrust suit against three publishing houses this past September, she channeled Emily Dickinson: "There is no Frigate like a Book / To take us Lands away." The deal marked partial closure for a price-fixing investigation launched last spring by the Justice Department, which alleged that five major publishers, along with Apple, had been secretly working to erode Amazon's market dominance by colluding to set higher prices on e-books. Judge Cote no doubt intended her poetic metaphor as a comment on the social value of books, but the case has intensified arguments over value in its more literal sense, and in particular over who ought to decide one of the thorniest questions in the digital marketplace: How much should an e-book cost?

Under the terms of the settlement, Hachette, HarperCollins, and Simon & Schuster have agreed to discontinue the so-called agency sales model--according to which publishers set e-book prices and retailers pocket a commission (typically 30 percent)--for two years. The publishers will also pay out a collective $69 million in compensation, the result of a damages claim filed by forty-nine states on the heels of the...

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Gale Document Number: GALE|A337370850