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Author Turow fears DOJ Apple suit would empower Amazon

The Authors Guild president dubs Amazon "Darth Vader," arguing in an op-ed that a trustbuster suit against Apple could lead to the demise of brick-and-mortar booksellers.

Jay Greene Former Staff Writer
Jay Greene, a CNET senior writer, works from Seattle and focuses on investigations and analysis. He's a former Seattle bureau chief for BusinessWeek and author of the book "Design Is How It Works: How the Smartest Companies Turn Products into Icons" (Penguin/Portfolio).
Jay Greene
3 min read

Scott Turow, the best-selling author and president of the Author's Guild, wants the Department of Justice to rethink its possible suit against Apple and five U.S. publishers for alleged price-fixing of e-books over fears that it could hand Amazon even more power over the publishing industry.

In an op-ed piece for Bloomberg, the "Presumed Innocent" author dubs Amazon "the Darth Vader of the literary world." And in an interview with CNET, Turow said he's worried that Amazon's tactics will unfairly undermine brick-and-mortar booksellers and ultimately the publishing industry.

"I don't think it's fair for bookstores to die because Amazon is engaged in predatory pricing," Turow said in the interview.

Author Scott Turow CBS/The Early Show

Turow frets that Amazon's powerful position in publishing will only get stronger if the Justice Department follows through with a suit against Apple and the publishers. Trustbusters are reportedly looking into price-fixing allegations over the so-called "agency model" that Apple pioneered with booksellers. That model allows booksellers to set their own e-book prices, rather than the traditional wholesale model in which publishers set a retail price and retailers set their own sales price.

The Wall Street Journal, which broke the story earlier this month, reports that the publishers expected to be named in the lawsuit are HarperCollins Publishers, Hachette Book Group, Macmillan Publishers, Penguin Group, and Simon & Schuster. (Simon & Schuster is owned by CBS. CNET News is published by CBS Interactive, a unit of CBS.)

The wholesale model, which Amazon prefers, led to lower prices of e-books for consumers than the agency model. But Turow said if the wholesale model is restored, it will ultimately give Amazon a hammerlock on bookselling because it will allow the company to use predatory pricing to undermine rivals.

"It's bad for consumers because you're paving the way for a monopoly," Turow said. If Amazon prevails in obtaining that monopoly, he says that "prices won't always be $9.99," the amount Amazon often sold digital best-sellers for under the wholesale model. He believes Amazon will jack up prices once its competition is marginalized.

Amazon declined to comment on Turow's concerns.

Of course, if Amazon obtains a monopoly and then abuses it, trustbusters could target the company with a separate investigation. But Turow worries that it will be too late for the book publishing industry at that point.

"You'll end up with one bookseller in the United States because Amazon will crush everyone else," Turow said.

In that world, he believes that the diversity of books and authors will wither, even as titles become more expensive.

That's why he describes Apple's Steve Jobs as a "white knight" in his op-ed. The agency model gave Apple, in the odd position of underdog in digital books, the ability to compete with Amazon. And because the agency model lets publishers set prices, they can better manage their business models. That helps sustain the beleaguered industry.

Turow said he's not defending price-fixing. But he wants the Justice Department to consider "the complex ecology of bookselling in the U.S." That means looking at Amazon's practices as well.

"I wouldn't have a problem if they were knocking Apple's and Amazon's and everybody's heads together," Turow said.