Court’s antitrust decision against Apple is flawed

Lex McFarley:

Here is where the Court’s logic is strained and incorrect. The Court concedes that there is nothing wrong with using the agency model, the MFN clause or pricing tier caps. So essentially the Court is finding Apple liable for antitrust violations for knowing that the publishers wanted to raise prices. The Court is essentially holding that faced with that knowledge, Apple supplied those terms (agency, MFN, price tiers) to the publishers so they could then go to Amazon and impose the agency model and raise retail prices.

    • Publisher are free to go to Agency Model in couple of years as long as they do it one at a time.

    • Since Publishers pleaded guilty, They judge is assuming that without Apple they are not guilty.

    • Amazon shifts prices every second of the day. How can competitor match the prices when that is happening.

    • If Apple had staggered the Publisher contract to every three months. There would be no trial.

  • Meaux

    All that article shows is that Lex McFarley doesn’t understand what the anti-trust case is. There is no reference to the words “collusion”, “coordination” or any other term that indicates that the publishers worked together. Which ignores that what is legal for a company to do on their own (let’s say raise prices), is illegal when competitors coordinate to do together (say if Delta, United, American and Southwest all agreed to raise prices together). What Apple did on an individual basis is legal, what makes this an anti-trust case is that they coordinated the publishers that controlled 90% of NYTimes best sellers.

    McFarley also ignored that Amazon was not on trial. The solution to potential illegal anti-competitive behavior is not to engage in illegal anti-competitive behavior, it is to file a federal suit.