Wow. Did Apple dictate that publishers change their Amazon contracts? If so, then I completely agree, Apple is clearly in the wrong. However, this is the first I've heard this. Can you lead me to supporting evidence?
The agreements also included a price parity provision, or Most-Favored-Nation clause (“MFN”), which not only protected Apple by guaranteeing it could match the lowest retail price listed on any competitor’s e-bookstore, but also imposed a severe financial penalty upon the Publisher Defendants if they did not force Amazon and other retailers similarly to change their business models and cede control over e-book pricing to the Publishers. As Apple made clear to the Publishers, “There is no one outside of us that can do this for you. If we miss this opportunity, it will likely never come again.”
Welp, I just spent an embarrassingly long while reading the 160 pages of the findings. I'm now of the opinion that Apple is probably guilty of antitrust violation. Judge Cote admits (on page 157) there's nothing inherently wrong with MFN clauses, simultaneous negotiation, price caps, or any of Apple's contracts. It's even plausible Apple could have escaped culpability, were it not for evidence that Eddie Cue and Steve Jobs knew that the publishers already wanted to raise prices, and willfully provided them the opportunity. An MFN clause was meant to protect Apple, but, because of Amazon's artificially low prices, it also had the effect of tending to indirectly trigger an industry wide switch to the agency model with increased prices, and Apple expected this. It was this expectation that apparently elevated the act to conspiracy.
Despite that, I must admit, I feel ambivalent about the ruling. Amazon's below-cost retail pricing appeared to have otherwise prevented Apple from even attempting to enter the market, at all, unless they came up with some way to profit. I guess they picked the wrong way.
