/// Apple’s Cue Says Publishers Pushed for Higher E-Book Prices

June 13, 2013  |  All Things Digital


Just days after introducing Apple’s new iTunes Radio streaming music service at the company’s Worldwide Developers Conference in San Francisco, Eddy Cue — Apple’s senior VP for Internet services and software, and its master dealmaker — appeared in a Manhattan federal court as a central witness in the U.S. Department of Justice’s e-book price-fixing case. According to the government, Cue was the main intermediary between Apple and five major publishers and the “chief ringleader” of an alleged conspiracy to shift the e-book industry from the wholesale pricing model established by Amazon to an agency model where publishers, not retailers, set e-book prices, sending them higher than they had been in the past. But on the witness stand Thursday, he maintained he was anything but. Presented with phone records that suggested a group of five publishers were discussing among themselves Apple’s agency model proposal, Cue denied any knowledge of the communications. In fact, Cue said he didn’t even suspect the publishers might be coordinating. “I don’t believe they were working together to do the deal that I was working on because I did those deals and I struggled and fought with them for many, many days to get them to sign,” Cue said. “And they argued different points. So if they were talking to each other, I would have assumed that I would have had a much easier time getting those deals done.” And while the government was able to force him to acknowledge that the price of some e-books did rise after Apple opened its iBookstore, Cue remarked that this shouldn’t have been a surprise given the publishers’ dissatisfaction with Amazon’s lowball $9.99 pricing. “They had expressed they wanted higher prices from us,” he said, reiterating what Cupertino has argued throughout this process: That it was the publishers who raised e-book prices, not Apple. And when pressed to admit that higher e-book prices were not in the best interest of the general public, Cue refused to concede. Instead, he insisted Apple’s entrance into the e-book market dramatically improved it.

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Apple’s Cue Says Publishers Pushed for Higher E-Book Prices



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