Apple Investigation: Read Steve Jobs' Email to James Murdoch

9:30 AM PST 05/17/2013 by THR Staff
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Steve Jobs

UPDATED: The Department of Justice is probing the tech giant for allegedly conspiring with HarperCollins to fix prices for e-books -- and undermine Amazon in the process.

An email sent from Steve Jobs to News Corporation's James Murdoch has surfaced in the Department of Justice case against Apple for allegedly conspiring to fix prices for e-books. 

In January 2010, the Apple CEO reached out to Murdoch -- son of media mogul Rupert Murdoch and the deputy chief operating office at News Corp., which owns the publisher HarperCollins -- with a proposal encouraging the exec to adopt the tech giant's pricing model over that of Amazon.

"Throw in with Apple and see if we can all make a go of this to create a real mainstream e-books market at $12.99 and $14.99," he wrote, also laying out these other two options: "Keep going with Amazon at $9.99. You will make a bit more money in the short term, but in the medium term Amazon will tell you they will be paying you 70% of $9.99; or, "Hold back your books from Amazon. Without a way for customers to buy your books, they will steal them. This will be the start of privacy and once started there will be no stopping it."

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According to All Things D, which first posted the email, Jobs' pitch might be as nefarious as it seems, based on his sentence admitting that perhaps Amazon selling books at $9.99 is "right and we will fail even at $12.99."

"Read as a whole, Jobs’s email doesn’t have quite the conspiratorial tone the DOJ suggests," writes Jon Paczkowski. "The late Apple co-founder doesn’t seem to be presenting $12.99 and $14.99 as hard and fast prices, but as price caps in broader pricing tiers. And he openly concedes that the agency model he’s proposing may well fail and that publishers who opt against it may succeed."

UPDATE: THR has received a statement from Orin Snyder, a partner at Gibson, Dunn & Crutcher LLP and lawyer for Apple:  

"Apple should be commended, not sued.  Apple injected much-needed competition and innovation into the eBook business.  Since Apple’s entry, eBook prices have gone down, consumers have downloaded hundreds of millions of new eBooks, and the e-reading experience has been transformed.  The DOJ’s case is based on fictions and incomplete quotations.  The actual evidence proves that Apple did not conspire to fix prices in the eBook business.  We look forward to trial.”
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