Penguin Reaches Deal With EU To Drop Apple E-Book Pricing

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The European Commission announced today that it has reached a deal with publisher Penguin regarding the e-book price fixing charges raised by the EU back in 2012.

Like the four other publishers charged with colluding with Apple to fix the price of e-books, Penguin has agreed to ditch Apple’s agency model for e-books that let publishers set prices for e-books while distributors like Apple, Amazon or Barnes & Noble get a cut of the sale.

Apple and the four other publishers struck a deal with the EU earlier this year similar to the one Penguin has reach. The new deal will allow retailers to set their own prices and discounts for the next two years, and they’ve also agreed to suspend “most favored nation” contracts for the next five years:

The Commission has concluded that, taken together, the commitments offered by Penguin, complementing those made binding by the Commission on the other four publishers and Apple, will contribute to creating a favourable environment for a reset of the competitive conditions in the e-books market during a sufficient period of time.

First, Penguin will terminate its relevant agency agreements with retailers Second, the two year “cooling-off” period during which retailers will be able to discount e-books will now also apply to all Penguin e-book titles. Third, the price MFN ban will apply to agreements renegotiated between Penguin and any other retailer (not only to agreements renegotiated between Penguin and Apple).

Apple’s headaches with e-book pricing aren’t likely to go away anytime soon. The iPad-maker was found guilty of e-book price fixing in the U.S. earlier this month, with initial estimates on pegging Apple’s settlement bill somewhere near $500 million.

About the author

Buster HeinBuster Hein is Cult of Mac's Senior News Editor and lives in Phoenix, Arizona. Twitter: @bst3r.

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