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ExtraBITS for 16 April 2012

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The Department of Justice antitrust lawsuit against Apple and six major publishers weighed heavily in our reading this week, with two pieces standing out: Charlie Stross’s deconstruction of Amazon’s ebook strategy and Nilay Patel’s look at the actual lawsuit. Also this week, Facebook acquires Instagram for $1 billion, and some TomTom GPS devices lose their way.

Monopoly, Monopsony, and the DOJ Ebook Price-Fixing Suit -- Author Charles Stross deconstructs Amazon’s ebook strategy. Along the way, he provides useful background about the differences between monopoly and monopsony, and offers interesting speculation about the future of digital rights management in the wake of the Department of Justice’s antitrust lawsuit against Apple and six major publishers.

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The Verge Analyzes the DOJ’s Ebook Price-Fixing Case against Apple -- The United States Department of Justice (DOJ) has filed an antitrust lawsuit against Apple and book publishers Hachette, Simon & Schuster, Harper Collins, Pearson, Penguin, and Macmillan. The suit claims that the publishers — with significant assistance from Apple — colluded to raise prices and force the industry to adopt the “agency model” that allows publishers to set their own prices and gives Apple a 30 percent cut of each sale. (Three publishers — Hachette, Simon & Schuster, and Harper Collins — have already settled, while Macmillan and Penguin have opted to fight the suit. Apple commented to Macworld that the DOJ’s accusation is “simply not true.”) The Verge’s Nilay Patel, who has a background in law, looks at many specific aspects of the government’s case, pointing out why the DOJ believes the actions undertaken by the publishing companies constitute open collusion (including actual back room deals and conspiracies).

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Facebook to Acquire Instagram for a Billion Dollars -- In a blog post, Kevin Systrom, CEO of the photo sharing service Instagram, announced that his eight-person company will be acquired by Facebook. Facebook CEO Mark Zuckerberg chimed in on his own timeline, adding, “For years, we’ve focused on building the best experience for sharing photos with your friends and family. Now, we’ll be able to work even more closely with the Instagram team to also offer the best experiences for sharing beautiful mobile photos with people based on your interests.” Facebook says the transaction will be valued at $1 billion. We hope the owners of Instagram will share some of the windfall with their tiny, but effective, staff.

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It’s 10 O’Clock. Does Your TomTom Know Where It Is? -- GPS manufacturer TomTom revealed that a “leap year” bug in a number of models prevented the units from finding their locations. Starting on Sunday, 1 April 2012 (ouch!), the glitch left some users stranded in unfamiliar locations without navigation assistance. TomTom’s support page lists affected models (including several Go, Via, and Start models) and provides instructions for using the MyTomTom desktop software to install a fix for the problem.

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