Day 5 of the Apple ebooks trial: Publishing execs testify; Rupert Murdoch’s role

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U.S. vs. Apple  resumed in New York Monday after a three-day break. Amazon executives, plus Google’s Tom Turvey, had testified Thursday; Monday brought testimony from HarperCollins CEO Brian Murray and Macmillan CEO John Sargent, both appearing as government witnesses. A roundup of the day’s proceedings:

  • The day “provided more examples that publishing CEO’s are not necessarily very helpful or illuminating witnesses for the government,” Publishers Marketplace notes. HarperCollins CEO Brian Murray said without pressure from News Corp executives (as a reminder, News Corp is the parent company of HarperCollins), he likely would not have signed an agency agreement with Apple in January 2010 before the iBookstore launched: “If I was making this decision at this point in time for only HarperCollins, I would not sign the deal. I would have waited and continued to negotiate…I thought the best chance of me getting good terms with Apple was if I was able to engage Amazon or Barnes and Noble in a conversation at the same time, and both of them had told me they were not ready to begin a discussion.”
  • One of the government exhibits was an email exchange in which News Corp CEO Rupert Murdoch told Murray he wanted to “screw Amazon,” after Amazon announced that it would offer authors a 70 percent royalty through Kindle Direct Publishing (essentially the same terms as an agency model). “That move infuriated a number of publishers,” reports Publishers Weekly, “including Murdoch, apparently, who saw the move as a threat from Amazon and more proof that Amazon would one day seek to woo publishers’ authors directly.”Screen Shot 2013-06-11 at 8.44.15 AM
  • HarperCollins negotiated an “Author Outs” provision with Apple, reports the New York Post, “which meant not all new releases would sell under the agency model” if an author didn’t want to, but it’s unclear whether this option has ever been exercised.
  • Macmillan CEO John Sargent told DOJ attorney Mark Ryan ” he never believed Sony could compete, doubted whether Barnes & Noble could succeed as a device-maker, and said that Google, while great at search, is a terrible retailer,” Publishers Weekly reports. And “Sargent also made no bones about what Macmillan hoped to accomplish with Amazon. ‘Typically one party controls price, and one party controls availability. Amazon wanted both. And we were going to force them to choose one or the other.'”

On Tuesday, Sargent will complete his testimony, followed by either Hachette CEO David Young or Apple director Keith Moerer. On Wednesday, the government’s expert witnesses are expected to testify, and Apple SVP Eddy Cue is set to take the stand Thursday.

If you want some separate background reading in the meantime: Gordon Crovitz has a Wall Street Journal editorial that describes the ebooks case as “Exhibit A in the case against market meddling,” and The Verge profiles Apple’s lead counsel Orin Snyder, writing, “Snyder is not yet the household name that David Boies or Alan Dershowitz are, but he’s speeding in that direction.”

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