Thursday, April 12, 2012

Are online publishers guilty of violating anti trust laws?

The Justice Department is set to find out. It is suing publishers (in the United States District Court for the Southern District in New York) for price fixing.

Anti trust laws - which have been a staple of national power since passed of the Sherman and Clayton anti-trust acts - allow the national government to break apart real or budding monopolies, or any activity which leads to uncompetitive practices.

The Justice Department is investigating whether this has happened in the e-book market. Did Apple secretly force- or persuade - other publishers to not under price its books? But this effort might allow Amazon, which controls 60% of the market, to expand its influence over it by reducing its prices far below what other publishers can command.