|From: Made In China|
"Closing arguments for the Department of Justice’s antitrust suit against Apple concluded last week, although U.S. District Judge Denise Cote is not expected to reach a decision for another couple of months. If you’ve found the case difficult to follow, you’re not alone. Still it’s worth getting a handle on the basics because the suit — or, more precisely, the business deals behind it — have changed book publishing in significant ways. Furthermore, Judge Cote’s decision could have impact well beyond the book industry.
First, there’s the wholesale model, the way that book publishers have sold printed books to bookstores and other outlets for years. The publisher sets a cover price for a book, sells it to a retailer at a discount (typically 50 percent) and then the retailer can sell the book to consumers for whatever price it chooses.
The other method of selling books is via the agency model, which means, essentially, on commission. The retailer offers the book to consumers at a price the publisher sets and gets a percentage of whatever sales are made. It’s rare for print books to be sold in this way, but it’s the method Apple uses to sell content like music and apps in its iTunes store."
— Laura Miller, Salon
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