On Fri, 18 Feb 2011, Darrell Fuhriman wrote:

> On Feb 17, 2011, at 12:22, Ed wrote:
>
>> "and to agree not to sell their books anywhere else for a lower price"
>> is illegal restaint of trade and will get you busted by the feds (when
>> they are doing their jobs)
>
>
> OK, at the risk of adding to an already long thread, this is patently 
> false, and is in fact a standard part of many wholesale contracts, 
> though it's usually framed as "If you sell the product at a lower price 
> to anyone else, you have to give me the same price." Of course, it's 
> likely only the big retailers that can successfully demand such a 
> clause. But restraint of trade it isn't.

for wholesale contracts where you buy the product at one price and then 
decide what markup to add to it when you resell it, I don't have a big 
problem with this sort of 'most favored nation' contract.

I wouldn't even have a problem with this if it was just referring to the 
retail price of electronic goods being sold to a particular platform.

but when you then add the demand for a percentage of the retail price you 
are going too far.

in other words, if apple wanted to have a 100% markup on all amazon books 
purchased through the iphone, they have the perfect right to do so, but 
they don't have the right to both set the amount of profit they make _and_ 
demand that the retail price be the lowest available.

David Lang
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