updated 11:35 am EDT, Wed June 12, 2013
Suggests Apple was aiming at forcing Amazon to accept higher prices
As a result of an email written by former CEO Steve Jobs, Apple may have suffered a significant blow at the e-book antitrust trial being pursued by the Department of Justice. Fortune reports that the head of Apple's iBookstore, Keith Moerer, testified yesterday that Apple had never asked or pressured any book publisher into changing contracts with Amazon from a wholesale model to Apple's preferred agency model, in which publishers can dictate higher prices. Apple was "indifferent" to what model publishers used with Amazon, Moerer claimed.
Publishing executives had previously corroborated Moerer's views. One example is Macmillan's John Sargent, who testified that while he did present Amazon with an ultimatum to switch to the agency model, no one at Apple had asked him to do it. He also said that the Macmillan contract with Apple makes no reference to Amazon one way or another.
The Jobs email, presented yesterday by DoJ attorney Dan McCuaig, appears to contradict statements by both Moerer and the publishing executives. The message dates back to January 14th, 2010, and finds Jobs responding to a request from publishers that the price caps in the iBookstore contract be raised. "I can live with this," Jobs writes to Eddy Cue, the Apple executive who was handling e-book negotiations at the time, "as long as they move Amazon to the agent model too for new releases for the first year. If not, I'm not sure we can be competitive..."
Under examination by McCuaig, Moerer admitted that the email didn't reflect "indifference" on Apple's part. Apple's chief counsel, Orin Snyder, attempted to defuse the situation by saying the email was never sent, but the DoJ objected, and US District Judge Denise Cote ordered the comment stricken from the record.
Cue is scheduled to testify on Thursday. Until now Apple has enjoyed some success at the e-book trial.