Eddy Cue did the legwork, but the deal had Steve Jobs written all over it
After the 56 phone calls in the space of two months, the clandestine meetings in swank Manhattan eateries, the secret e-mails "double erased" to ensure they couldn't be traced, it all boiled down to three days in January 2010, when Eddy Cue, Apple's (AAPL) vice president of Internet services, pushed five of the six leading book publishers for a "final go-no go" decision on an agreement that the Department of Justice has described as a "per se violation" of the Sherman Antitrust Act.
The complaint filed in federal court Wednesday reads like a conspiracy novel, and it reaches its climax on page 25 of 36:
On the evening of Saturday, January 23, 2010, Apple's Cue e-mailed his boss, Steve Jobs, and noted that Peguin USA CEO David Shanks "want[ed] an assurance that he is 1 of 4 before signing...
On January 24, 2010, Hachette signed an e-book distribution agreement with Apple. Over the next two days, Simon & Schuster, Macmillan, Penguin, and HarperCollins all followed suit.
Central to the government's objection to the agreement is a clause that was added in early January. It's a clever -- if legally problematic -- piece of dealmaking that has the feel of something Steve Jobs might dream up:
Apple replaced the express requirement that each publisher adopt the agency model with each of its retailers with an unusual most favored nation ("MFN") pricing provision. That provision was not structured like a standard MFN in favor of a retailer, ensuring Apple that it would receive the best available wholesale price. Nor did the MFN ensure Apple that the Publisher Defendents would not set a higher retail price on the iBookstore than they set on other websites where they controlled retail prices. Instead the MFN here required each publisher to guarantee that it would lower the retail price of each e-book in Apple's iBookstore to match the lowest price offered by any other retailer... That is, instead of an MFN designed to protect Apple's ability to compete, this MFN was designed to protect Apple from having to compete on price at all, while still maintaining Apple's 30 percent margin. (emphasis ours)
A few pages later, Apple's Pete Alcorn describes a meeting with Cue and another Apple executive:
"I think he and Eddy made it at least halfway to changing the industry permanently. ... The interesting insight in the meeting was Eddy's explanation that it doesn't have to be that broad -- any decent MFN forces the model."
I don't usually recommend DOJ complaints as good bedtime reading. This one may be the exception. You can get the pdf here.
The settlement the Justice Department is seeking could shutter the iBookstore
Reuters and Bloomberg have both reported -- citing a pair of unnamed sources -- that Apple (AAPL) and one or two major publishers are preparing to get sued for antitrust violations, perhaps as early as today.
Three of the five publishers accused of colluding with Apple to fix the prices of e-books have reportedly accepted deals offered by the European Commission and MOREPhilip Elmer-DeWitt - Apr 11, 2012 7:12 AM ET
Much ado about an entry in Simon & Schuster's fall catalog
A lot of nonsense has been written about the discrepancy -- first spotted Monday by SetteB.it's Fabio M. Zambelli -- between the page count listed on Amazon.com for Walter Isaacson's Steve Jobs (448 pages) and the one on Simon & Schuster's website (656 pages).
But the item John Hudson posted on The Atlantic Wire struck me as particularly dumb. Under the bizarre headline "Steve MOREPhilip Elmer-DeWitt - Sep 13, 2011 7:13 AM ET
The look of Walter Isaacson's bio will be as spare and restrained as any Apple product
"The cover," writes Isaacson in private e-mail, "is the Albert Watson portrait taken for Fortune in 2009. The back is a Norman Seeff portrait of him in the lotus position holding the original Macintosh, which ran in Rolling Stone in January 1984. The title font is Helvetica. It will look as you see it, with MOREPhilip Elmer-DeWitt - Aug 16, 2011 7:39 AM ET
"iSteve: The Book of Jobs" was the publisher's idea. The author had second thoughts.
The first biography of Apple's (AAPL) CEO to get Steve Jobs' blessing -- and cooperation -- hasn't yet been published. Or even finished. But it's already made it (briefly) into the top 50 on Amazon's bestseller list. And it's already undergone its first revision.
It's got a new title.
The old one, iSteve: The Book of Jobs, was chosen MOREPhilip Elmer-DeWitt - Jul 5, 2011 6:15 PM ET
The unpublished book is already climbing fast on Amazon's best-seller lists
Talk about stoking the fires of publicity.
Word that Steve Jobs had agreed to cooperate with Walter Isaacson, a former managing editor of Time Magazine (and my former boss), on an authorized biography first leaked out 16 months ago. (See The man who won Steve Jobs' trust.)
Two months ago, Simon & Schuster announced that the book, which Isaacson started working on MOREPhilip Elmer-DeWitt - Jun 5, 2011 7:45 AM ET
Who is Walter Isaacson, and why did Jobs choose him to tell the story of his life?
Apple's iPad event last month was packed cheek to jowl with the famous and well-connected, from John Doerr to Al Gore. But I was still surprised see my old Time magazine editor in the middle of the action. What in the world was Walter Isaacson doing at an Apple (AAPL) event in San Francisco?
The MOREPhilip Elmer-DeWitt - Feb 16, 2010 10:14 AM ET
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