Apple will be on the hook for $450 million after losing its appeal in the e-book price-fixing case, Bloomberg reports. The United States Supreme Court released the decision after Apple appealed the prior ruling. The high-profile case dates back to a 2012 lawsuit from the United States, which Apple appealed all the way to the Supreme Court, but the justices declined to hear the case which leaves the prior ruling intact.
e-books Stories March 7, 2016
e-books Stories March 5, 2015
EU court says ebooks aren’t books, must be subject to higher tax rates
Europe’s top court has declared that ebooks are ‘services’ rather than books, and that European countries are not allowed to give them the same favorable tax treatment as paper books. The reasoning, such as it is, is that ebooks cannot be used without a physical device, and ebooks are a service provided to those devices.
Both France and Luxembourg have applied to ebooks the same reduced rate of VAT (sales tax) enjoyed by books made from crushed trees. The WSJ reports that the EU has ruled that this is illegal.
Since 2012, France has applied a 5.5% VAT rate and Luxembourg a 3% VAT rate on e-books, the same rate as for paper books. The European Court of Justice said both countries must apply their normal VAT rate, which for France is 20% and for Luxembourg is 17%.
Europe already closed one ebook-related tax loophole: Amazon used to use its Luxembourg base as a reason to charge just 3% on ebook sales throughout Europe, but a change in the law forced it to apply the VAT rate applicable to the customer’s own country.
There is some small hope that sanity may prevail in future. The European Commission has said that there may be legal mechanisms through which countries can in future define their own policies, with an “extensive overhaul” of VAT rules to be completed next year. However, don’t be surprised if ‘harmonization’ of tax rates for paper and digital books results in higher taxes on the former to pay for lower taxes on the latter …
Apple of course had its own legal troubles around ebooks, with its pricing model found to amount to anti-competitive practices.
e-books Stories July 25, 2014
Apple’s ebook settlement may not be quite so settled as judge expresses concern
Just as we thought Apple’s long-running ebooks suit might finally be settled, the out-of-court agreement has been thrown into doubt. The judge required to approve the settlement terms has expressed concern that they may be unfair to consumers, reports Business Insider.
U.S. District Judge Denise Cote in Manhattan said she found “most troubling” a clause requiring Apple to pay only $70 million if an appeals court reversed her finding that the company is liable for antitrust violations and sent it back to her for further proceedings.
Apple was found guilty of price-fixing, an allegation it always denied and is currently appealing. To speed things up, lawyers on both sides agreed what would happen for each of the three possible outcomes of the appeal.
If Apple wins the appeal, it will pay nothing. If it loses the appeal, it will pay $50M in legal costs and $400M to a compensation fund for consumers. The contentious part is what happens if the appeals court overturns the original verdict but sends the case back for new proceedings. In this event, the proposal is that Apple would pay just $70M, of which the compensation fund would receive $50M.
Cote questioned if that would be fair and what might happen if the appeals court reversed her ruling on a minor issue.
e-books Stories June 10, 2014
Amazon integrates Audible audiobooks directly into Kindle mobile apps
Amazon announced today that it’s integrating the Audible audiobook service it purchased back in 2008 directly into the Kindle apps for both iOS and Android. After installing a free update landing today for the apps, users will be able to listen to Audible audio books without ever having to leave the app.
“We continue to hear from a growing number of Whispersync for Voice converts who tell us the innovation has profoundly changed the way they read—in fact, switching back and forth between reading and listening has become their preferred way of experiencing stories,” said Audible founder and CEO Donald Katz. “And the feature has gotten easier and easier to use, as this exciting integration into Kindle apps attests.”
The service is an extension of the Whispersync for Voice feature that Amazon recently launched. That feature allowed users to switch “seamlessly” between reading and listening but required users to have both the Kindle and Audible apps. With the updated Kindle apps, users will be able to get narrations for 45,000 Kindle books and growing as well as purchase Audible upgrades for previously purchased Amazon Kindle books ranging from $1 to $4. The audio and text versions of the book will stay in-sync, pages turn automatically, and narration includes a x2 speed mode and sleep timer option. The best part is that you won’t be pulled out of Kindle and into the Audible app now when switching between text and audio.
The update includes other new features too, including: improvements to the X-Ray reference tool for textbooks and the ability to download an entire collection with a single tap. A full list of new features is below.
The updated Kindle app for iPhone and iPad is available on the App Store now.
What’s New in Version 4.3
Listen to Audible audiobooks! Customers owning both the Kindle and Audible versions of a title can now listen to the audiobook right in the Kindle app.
Now you can use the Kindle app to switch back and forth between reading a Kindle book comfortably at home and listening to the story while driving to work.
Additional Features Include: •Access to more than 45,000 Kindle/Audible title pairs, including best sellers • Find audiobooks compatible with items in your Kindle library – audiobooks are delivered by Audible, an Amazon company • Whispersync for Voice automatically synchronizes reading progress between the Audible and Kindle versions of a book • Read and listen to a Kindle book at the same time; pages turn automatically • Narration speeds up to 2x and a sleep timer • Download an entire collection – gives customers the ability to download an entire collection with the tap of a button, making it easier for readers to download in bulk and load their favorite books on a new iOS device • Students can now find terms that are in X-Ray for Textbooks by using search – occurrences in X-Ray are shown right above occurrences in the book • Finding where an X-Ray term occurs on a textbook page is now easier – tap a page thumbnail in the X-Ray feature and you will see the term highlighted in the page of the book • Performance and stability improvements
e-books Stories March 8, 2012
The Wall Street Journal reports that the United States Justice Department threatened to launch an antitrust lawsuit against Apple and five of the nation’s biggest book publishers over an alleged price-fixing that has resulted in higher prices of e-books.
Several of the parties have held talks to settle the antitrust case and head off a potentially damaging court battle. If successful, such a settlement could have wide-ranging repercussions for the industry, potentially leading to cheaper e-books for consumers. However, not every publisher is in settlement discussions.
The government is specifically aiming to probe 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. that also owns The Wall Street Journal.
At question: The so-called agency model where publishers freely set prices of their titles on Apple’s iBookstore before the Cupertino company reaps 30 percent of the proceeds. The freedom to pick the price has led most—if not all— publishers to allegedly raise prices of e-books across the board as they feared customers would get accustomed to inexpensive $9.99 Kindle books from Amazon.
Barnes & Noble CEO William Lynch already gave a deposition to the U.S. Justice Department. He said abandoning the agency model would allow a single party to achieve dominance in the marketplace, alluding to Amazon. According to the people familiar with the matter, the U.S. Justice Department believes that Apple and the publishers “acted in concert to raise prices across the industry, and is prepared to sue them for violating federal antitrust laws.”