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HarperCollins Settles with the Department of Justice

HarperCollins has settled with the Department of Justice rather than face a lawsuit over the agency model for eBook pricing. Hachette and Simon & Schuster have followed suit.

Here’s more from the official statement: “HarperCollins faced legal challenges on five separate fronts, including the DOJ investigation which was resolved today. The e-book market has grown over the last two years from a small e-ink market, dominated by one platform, to a $1B market with several competing platforms. HarperCollins made a business decision to settle the DOJ investigation in order to end a potentially protracted legal battle.”

The publisher issued a longer statement that did not detail the terms of the settlement. We have more about the proposed settlement at this link. The complete HarperCollins release is reprinted below…

HarperCollins Publishers Settles e-Book Pricing Dispute with the Department of Justice

(April 11, 2012)

HarperCollins Publishers today announced that it has reached an agreement with the United States Department of Justice to end its investigation into HarperCollins’ contracts for the distribution of e-books. HarperCollins did not violate any anti-trust laws and will comply with its obligations under the agreement. HarperCollins’ business terms and policies have been, and continue to be, designed to give readers the greatest choice of formats, features, value, platforms and partners – for both print and digital.

After HarperCollins adopted the agency model in 2010, the e-book market exploded, giving consumers more choices of devices, formats and prices that would never have existed but for the agency model. Some examples include:

-The iBookstore, which offers iTunes customers a storefront to buy HarperCollins’ books
-The launch of Barnes & Noble’s NOOK Book Store, which grew faster than any other platform for HarperCollins’ titles over the last two years
- Prices for dedicated e-readers declined from almost $400 to under $100, and competition exploded in the device market, making the e-book reading experience less expensive
- Dynamic pricing of HarperCollins’ e-books, including some titles priced under $2, was introduced to maximize the sales and reach of our authors and their books
- The introduction of color tablets with native e-book stores led by Apple and Barnes & Noble, which are now the fastest selling devices for e-book consumers
- The introduction and rapid development of enhanced e-books with audio, video and interactivity, which are a fast-growing digital format for HarperCollins

HarperCollins faced legal challenges on five separate fronts, including the DOJ investigation which was resolved today. The e-book market has grown over the last two years from a small e-ink market, dominated by one platform, to a $1B market with several competing platforms. HarperCollins made a business decision to settle the DOJ investigation in order to end a potentially protracted legal battle.

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