U.S. District Judge Denise Cote, a Clinton appointee, issued her ruling today in the case brought by the Justice Department accusing Apple of antitrust violations in pricing ebooks. It is a newsworthy ruling in many respects, but one, flagged by the subscription-only Publisher's Lunch, I found somewhat troubling. Her response to Apple's argument that a ruling against Apple would deter other potential new entrants to a market dominated by one major player, as the ebook market was dominated by Amazon before Apple's ruling, was essentially to say that the government, not market competition, should prevent monopoly behavior. From the ruling:
If Apple is suggesting that Amazon was engaging in illegal, monopolistic practices, and that Apple's combination with the Publisher Defendants to deprive a monopolist of some of its market power is pro-competitive and healthy for our economy, it is wrong. This trial has not been the occasion to decide whether Amazon's choice to sell NYT Bestsellers or other New Releases as loss leaders was an unfair trade practice or in any other way a violation of law. If it was, however, the remedy for illegal conduct is a complaint lodged with the proper law enforcement offices or a civil suit or both.
The message seems to be that if a firm sees a complacent, market-dominating player, the firm should go sue or complain to the government rather than trying to dive in and compete with a new product or service.
Earlier coverage of the Apple antitrust matter is here, here, here, and here.
Disclosures: I own some Apple stock, write this blog on an Apple laptop, and use an Apple iPhone as my mobile phone and Internet hotspot. This site is an Amazon affiliate, which means the company that owns it derives some advertising revenue from Amazon. I'm an author and a member of the Authors Guild, which took a position in the lawsuit. An electronic version of my book about Samuel Adams was published by one of the publishers that the Justice Department went after along with Amazon in the price-fixing case.
