It seems like Justice has a weak case. The dominant force in a market (Amazon) is selling products at a big loss in part to prevent or weaken competition. A competitor (Apple) comes in with a new business model that the suppliers of the product (publishers) like better and which lets them set minimum prices individually and vertically with retailers—something that is legal as of five years ago, if it doesn’t harm competition. The book industry argues this allows “more electronic booksellers to thrive,” which has the benefit of being obviously true, and Amazon and others get the same terms Apple does.

Unless the Justice Department has evidence that publishers got together to set minimum prices, and there’s no reason to believe that, then what’s the legal problem here?


Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu.