Steve Jobs wanted publishers to 'throw in with Apple' to create '$12.99 and $14.99' ebook market

iPad iBooks update

As more US states join the class action suit against Apple and major publishers over ebook pricing, new details have emerged in an amended complaint, including a previously redacted email showing that Steve Jobs stepped in directly to help along negotiations. In the amended complaint, the states say that Apple mediator Eddy Cue could not secure commitment for the proposed agency model from one of the publishers, so Apple went over its head: Steve Jobs sent an email to an executive at the publisher's parent company, offering them three "alternatives" to ebook sales. Jobs wrote that they could "keep going with Amazon at $9.99," but that publishers would eventually be earning "70 percent of $9.99" because "they have shareholders too." Or, Jobs wrote, publishers could hold back books from Amazon, but warns that "without a way for customers to buy your ebooks, they will steal them." The third option as Jobs saw it was to "throw in with Apple and see if we can all make a go of this to create a real mainstream ebooks market at $12.99 and $14.99." The complaint says that within three days of the email from Jobs, the publisher reversed its position and signed a formal contract with Apple.

"I hope you make Random House hurt like Amazon is doing to people..."

The complaint also reveals a new email from Penguin CEO David Shanks to Barnes & Noble's former CEO Steve Riggio, in which he encourages the bookseller to punish Random House, which had not agreed to the agency model. Shanks writes that "Random House has chosen to stay on their current model and will allow retailers to sell at whatever price they wish," and that "I would hope that [Barnes & Noble] would be equally brutal to publishers who have thrown in with your competition [Amazon] with obvious disdain for your welfare." Shanks tells Riggio that "I hope you make Random House hurt like Amazon is doing to people who are looking out for the overall welfare of the publishing industry." The complaint alleges that Shanks wanted Barnes & Noble to stop promoting or advertising Random House titles.

With the addition of New York, the District of Columbia, and fifteen other states, the class action complaint against Apple, Macmillan, and Penguin now has 31 participants.

The Verge
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