Apple To Face Antitrust Inquiry Over e-Book Pricing?

Apple may be riding high with iPad selling like hotcakes and iPhone 4G only a few weeks away from making its way to the markets. All is not well for Apple though. The company has become the target of the Feds just recently. The Department of Justice has already opened investigation into Apple’s practices in the music industry. Texas AG’s questioning of publishers about Apple shows that the company may be in hot waters with the Federal government for the foreseeable future.

That’s usually what happens when a company becomes huge in this country. Microsoft faced similar inquiries a few years ago. Apple seems to be the target now. Hachette Book Group and HarperCollins both seem to have been questioned by Texas AG, but the subject of those inquiries are not known. Considering that these publishers started dictating their own prices once Apple entered the market, it’s not hard to guess what Texas AG’s office was interested about knowing.

I do not read much into this inquiry by Texas AG. Amazon has been the dominant player in the e-book market for quite some time now. I doubt Apple is the sole reason publishers are interested in setting their own prices. Of course, you never know with Texas these days.

Some have argued in the past that the agency model adopted by top publishers is anti-competitive. That’s stretching it a bit. Besides, it’s tough to argue that Apple is responsible for that model being increasingly adopted by publishers. At this point, this looks like a witch hunt. We’ll know more if Apple is charged in the future.