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Oh, the Rotten Apple!

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Anti-trust lawsuit rocks Apple

© Mike Hodges

Earlier this month Apple landed in boiling water with the United States government after being found guilty in their recent anti-trust lawsuit. In their pursuit to happiness, Apple desired to launch a competitive electronic book market with their iPad release in 2010 but in order to do so, they manipulated the market to ante up prices with competitor, Amazon.

According to court documents, turns out they were not alone. In order to achieve their goal, Apple teamed up with the five leading publishing companies in the U.S. to bully and rally against Amazon. The publishers gave Amazon an ultimatum, raise your e-book price or forgo best sellers for months.

“Understanding that no one publisher could risk acting alone in an attempt to take pricing power away from Amazon, Apple created a mechanism and environment that enabled them to act together in a matter of weeks to eliminate all retail price competition for their e-books,” writes U.S. District Judge, Denise Cote, in her 160-page ruling.

Obviously, competition is natural but manipulating outcomes is illegal. In a free market system mum’s the word but this is a mixed market system, so businesses are accountable for their actions. Was it worth it? Only Apple can answer that.

How will this affect Apple’s reputation?

The answer is probably not. “The consumer response is a big yawn,” says Mark Patterson, a professor at Fordham Law School who specializes in antitrust matters, in an interview with the Wall Street Journal.

According to the Wall Street Journal, the trials for Apple continue including a second trial surveying damages as 33 state attorneys general seek to recover funds for consumers who paid higher prices for e-books as well as a private class action on price fixing.

Ultimately, Apple was successful as the prices of e-books have risen since 2010 but in the end, they will receive more than a slap on a wrist for their ill doings.

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  1. CR Lamar Jr says:

    agree with article on Apple.
    minipulation of market at consumer cost. a consumer that is apathetic for a few dollars more.Just give us the baby. who cares about the birthing.

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