MacNN | DoJ says Apple's in-app purchasing rules were aimed at Amazon
Mac News Network View: Standard | Headlines | Categorized | Slim
Mac News Network
Mac News iPod News Reviews Forums
 

Desktop Headlines
DoJ says Apple's in-app purchasing rules were aimed at Amazon
Friday, August 23, 2013 @ 3:32pm

The US Department of Justice has filed a revised settlement proposal for the outcome of its recent trial victory against Apple. The proposal is similar to the original, but incorporates an expanded section on in-app purchases, claiming that Apple formulated its rules to "retaliate against Amazon for competitive conduct that Apple disapproved of" and "make it more difficult for consumers using Apple devices to compare ebook prices among different retailers."



Since their inception in 2011, Apple's rules for in-app purchases have prevented apps from linking to outside storefronts that would bypass the Apple in-app purchase system, out which the company claims a 30 percent revenue cut. That forced a number of parties, including Amazon, to strip links to pre-existing stores out of their software. The DoJ remarks that Apple applies its 30 percent cut unequally. "During the August 9 conference, Apple's counsel argued that the provision [reintroducing links to outside bookstores] should not be adopted because it was 'absurd' to suggest that Apple had changed its apps policy to discriminate against e-book retailers," it writes. "These statements are incorrect. Apple misrepresented the factual circumstances surrounding this matter, including how the App Store operated and operates. It simply is not true that Apple receives a 30 percent commission from all retailers for all goods sold through apps. To use Apple's counsel's own examples, one can buy shoes today on an iPad using a Zappos app." As deeper evidence of a conspiracy, the DoJ includes an email exchange (below) between Steve Jobs, Eddy Cue, and Phil Schiller. Schiller complains about a 2010 TV ad for Amazon's Kindle apps, in which a woman is able to buy and read a book on an iPhone but then switch to an Android phone and keep reading. "While the primary message is that there are Kindle apps on lots of mobile devices, the secondary message that can't be missed is that it is easy to switch from iPhone to Android. Not fun to watch," part of Schiller's message reads. Jobs replies asking for ideas, but then immediately suggests that "The first step might be to say they must use our payment system for everything, including books (triggered by the newspapers and magazines). If they want to compare us to Android, let's force them to use our far superior payment system. Thoughts?" An important concession the DoJ is offering in the new settlement is the halving of a proposed injunction from 10 years to five. Apple would still, however, have to cancel its existing agency model deals with book publishers, and take on a third-party monitor to ensure compliance with antitrust rules. The company has protested, arguing that a monitor isn't necessary, and that the revised settlement terms are still designed to "inflict punishment."

Comments on this Article
Print Friendly Version
Email to a Friend
Add MacNN to Your RSS Feeds
Buy from the Apple Store


Related Stories:

Today's MacNN Stories:

  • Deal potentially reached in Silicon Valley anti-employee poaching suit - 4:11 PM EST
  • Trademark filings hint at possible future names for OS X - 2:57 PM EST
  • Briefly: Opera Coast for iPhone, Prong PWR iPhone case - 1:45 PM EST
  • Apple CEO Tim Cook auctions off lunch date for charity - 1:19 PM EST
  • Industry bigwigs launch OpenSSL-fixing Core Infrastructure Initiative - 1:16 PM EST
  • Hands-on: Logitech Hinge and Turnaround cases for iPad Air - 12:54 PM EST
  • Apple tops 2014 JD Power rankings for smartphone satisfaction - 12:05 PM EST
  • Facebook buys out Moves fitness app for iOS and Android - 11:00 AM EST
  • New MacBook Airs could debut as soon as next week, sources claim - 9:18 AM EST
  • Cook answers analyst questions on China, carriers, Apple - 3:02 AM EST
  • Good numbers of note: 800M iTunes accounts, 20M Apple TVs, more - 12:36 AM EST

    Today's iPodNN Stories:
  • Head of Google+ Vic Gundotra announces departure from Google - 3:15 PM EST
  • Russian President Vladimir Putin calls Internet 'CIA project' - 1:37 PM EST
  • Samsung Galaxy Beam2 launches in China with improved projector - 1:15 PM EST
  • Sony announces Vaio Fit repairs for battery fault will begin in May - 11:40 AM EST
  • Verizon reports revenues of $30.8B in first quarter financial results - 10:38 AM EST
  • No comments posted on this story yet. Please post yours.
    Your Comments
    In order to post comments, you must be a registered member of the MacNN Forums and logged in. Please login with your MacNN Forums username and password.

    MacNN Forums Login:

    MacNN Forums Password:

    Not a member of the MacNN forums? Register now for free.