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Apple Fires Back at the Feds, Amazon

Nearly two days after the Department of Justice filed antitrust charges against Apple and major book publishers, Apple is responding.  Here's comment from Apple spokesman Tom Neumayr: … Apple's response is similar to ones made by Penguin Group and MacMillan …

AllThingsD Peter Kafka

Context & Ripple Effects

The Department of Justice has filed antitrust charges against Apple and major publishers over e-book pricing, and within two days the defendants have coordinated their public posture: Apple spokesman Tom Neumayr's statement lands on nearly identical ground to responses from Penguin Group and Macmillan, all framing the case as a favor to Amazon rather than a fix for it.

That framing was pre-seeded weeks earlier by the argument, circulating since a March 2012 Bloomberg piece, that a DOJ suit would aid an Amazon book monopoly. The pickup breadth here — Wall Street Journal, CNET (twice), The Verge, WSJ-syndicated commentary predicting DOJ may lose — shows how contested the case already is before litigation begins.

First-order effects

  • Apple, Penguin Group, and Macmillan enter the DOJ case presenting a united front, shifting the narrative battle from 'price-fixing' to 'Amazon monopoly' before any courtroom exchange.
  • Tom Neumayr's public statement commits Apple to defending the publisher-side pricing arrangement in court, not just quietly settling.

Second-order effects

  • Publishers not yet named in the suit face pressure to either join the same public defense or accept DOJ terms, splitting the publishing bloc if responses diverge.
  • Amazon gains a rhetorical shield regardless of outcome: every defendant now argues the DOJ is effectively protecting Amazon's discounting power, forcing DOJ to defend its own theory of consumer benefit.

Third-order effects

  • If DOJ prevails on its pricing theory, the case becomes the template for how regulators treat platform-set versus supplier-set retail prices across digital media markets.
  • A DOJ loss or stalemate would embolden platforms and suppliers to argue antitrust enforcement can itself entrench incumbents, complicating future agency-model disputes.

The trend: E-book distribution is turning into the test case for whether antitrust enforcement targets supplier price coordination or platform market power, with Apple, Amazon, and the DOJ each claiming the monopoly label fits the others.