In its latest court filing, Apple asserts its right to trial before the anti-trust settlement between the Department of Justice and three of the Big Six publishers goes into effect.
Incredibly, Apple argues:
Apple had zero market share and no market power when it negotiated its entry through the challenged agency agreements
Really? Zero market share? No market power?
Let’s just look at the facts.
Fact: iBooks was introduced on January 27, 2010. On that date, Apple already knew it had sold close to forty million iPhones.
Fact: That number already exceeded the sales of all Sony Reader, Amazon Kindle, and other eInk devices combined. In its January 25, 2010 report, it announced it sold 8.7 million iPhones in just the previous quarter.
Fact: That iPhone device population were all potential eBook readers. They were already in use for Kindle books.
Fact: Jobs even bragged Apple was now the top mobile devices company.
Fact: Steve Jobs even listed eBooks in his iPad presentation, something he never mentioned in all past Keynotes.
Fact: Apple had 284 Apple Stores at the time.
Fact: Those Apple Stores had fifty million visitors in the last quarter of 2009.
Fact: Amazon had zero stores at the time — and still has zero.
Fact: Amazon’s mobile device revenues didn’t even rate placement in the list Jobs showed of mobile device revenues.
Fact: Apple was on its way to being a sixty billion dollar a year company.
Is Apple really going to argue that its installed device population wasn’t a factor in getting the Big Six to sign contracts?
Is Apple really going to argue that it had zero market power with those number of stores, those number of visitors, and with those revenues? Does that sound like a powerless company to you?
Really, would any other company that had true zero market share have been able to change the existing wholesale model as Apple did — and then force Amazon to adopt that model too?
And here is something that everyone else has missed:
even today, Apple is a distant third to Amazon and Barnes & Noble.
So Apple is claiming that it has already beat both Kobo and Sony in eBooks?
Both were established in the market well before Apple entered with the iBookstore — especially Sony.
Could any other company with true zero market share have done that, post-Amazon?
No, on the day that Apple introduced its iBooks software, it already had an existing device population that exceeded the total number of all eInk devices.
Apple was by default already the number one eBook device maker too.
If that doesn’t count for something, then everything is simply wrong with the Department of Justice’s case.
And let me kill one line of argument that Apple is very likely to use in its court defense. I saw this tactic early on and I’ve been waiting for Apple to play this card. It’s that iBooks is not pre-installed on iOS devices.
But if you step into any Apple Store — in fact, any store that has demo iOS devices for trying — you will find iBooks is pre-installed on those demo models.
Microsoft argued that although Internet Explorer was pre-installed with Windows, anyone was free to download any other browser. Well, iBooks is pre-installed on all iOS demo devices and that’s a clear unfair advantage against eBook software from Amazon, Barnes & Noble, Kobo, Bluefire, and others.
No government bought Microsoft’s argument and the Department of Justice should not buy Apple’s argument.
Apple is trying to have its cake and eat it with iBooks. And the Department of Justice had better call them on that.
I’m not even going to bring up — oh wait, I am! All of the iPad ads — on TV and in print — that show iBooks software being used!
Barnes & Noble — which is also against the Department of Justice settlement, siding with Apple — introduced its original Nook eBook device in October of 2009. Why didn’t Barnes & Noble offer the Big Six Agency contracts? Wouldn’t that arrangement have been in their best interest, to preserve the print bookstores they now claim are endangered?
Finally, it’s time for Amazon to show its numbers.
To establish Apple’s pre-existing defacto dominance in the eBook marketplace, Amazon needs to reveal how many eInk Kindles it sold versus the number of Kindle app downloads to the iPhone.
If the iPhone app number exceeds the eInk device number, case closed.
Apple already knows how many iPhones had the Kindle app.
Now we need to compare that to the number of Kindles sold then.
I would bet that there were more Kindles as iPhones out there than there were Kindles.
Apple an eBook weakling?
If sixty billion dollars and forty million devices is being “weak,” then how does anyone define “strength”?