Ka-ching! Amazon explains benefits from ebook price-fixing settlement

The direct results of the ebook price fixing scandal between Apple and the five major U.S. book publishers are one-step closer to turning into real money for millions of Amazon customers.

The online retailer recently began sending out e-mail notifications to Kindle ebook buyers telling them how much credit to expect as a result of the payout from the five major publishers.

“While we will not know the amount of your credit until the Court approves the settlements,” Amazon said in the e-mail. “It is estimated that it will range from $0.73 to $3.06 for every eligible Kindle book that you purchased.” An official posting on Amazon’s forum says the payout could be as high as $3.82 per ebook.

Previously, credits to Amazon customers were expected to be between $0.31 and $1.32 for every purchased e-book. The new settlement increase is the result of the final two of the big five publishers (MacMillan and Penguin Group) reaching a settlement with the Attorneys General of most U.S. States over the price-fixing suit.

But don’t expect to see credit rolling out to your account any time soon: The settlement still has to be approved by the court on December 6. If there are no appeals over the settlement and the court gives it a thumbs-up, then ebook credits will be free to roll out.

Credits to Amazon accounts will roll out automatically to eligible customers and can be used to purchase ebooks or physical print books. Anyone who would prefer to receive their credit as a check can also request it at a special Website set-up to handle the fallout of the case.

To be eligible to receive a credit on your Amazon account, you must have a U.S. billing address and purchased a Kindle ebook published by Hachette, HarperCollins, Macmillan, Penguin, and/or Simon & Schuster between April 1, 2010 and May 21, 2012.

Amazon did not provide a time frame of when to expect account credit after the December court hearing. The company plans to send out a second notice to customers once credit is delivered.

In July, U.S. District Judge Denise Cote ruled that Apple and the five major publishers conspired to raise prices of e-books. Apple was the only defendant to go to trial, while all five publishing companies settled before the case went to court.

Although the judge ruled against Apple, the company plans to fight the ruling.

“Apple did not conspire to fix ebook pricing and we will continue to fight against these false accusations,” Apple spokesman Tom Neumayr told our colleagues at Macworld after the ruling. “When we introduced the iBookstore in 2010, we gave customers more choice, injecting much needed innovation and competition into the market, breaking Amazon’s monopolistic grip on the publishing industry. We’ve done nothing wrong and we will appeal the judge’s decision.”

An earlier version of this story’s headline suggested that this payout is related to the Apple ebook ruling; it's been corrected to reflect that the credit issues from the settlement with the publishers.

Ian is an independent writer based in Tel Aviv, Israel. His current focus is on all things tech including mobile devices, desktop and laptop computers, software, social networks, Web apps, tech-related legislation and corporate tech news.
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Microsoft explains the Nokia deal: The phone is key to everything

In a Tuesday morning conference call to investors, Microsoft will justify why it acquired Nokia’s hardware business for a tad over $7 billion: It all starts with the phone.

In its “strategic rationale” explaining the deal, slide 15 of Microsoft’s presentation makes the case that the foundation for Windows PCs begins with Windows Phone, and pushes forward something of a domino effect toward platform dominance. Microsoft’s focus hasn’t shifted away from its “devices and services” message, but the balance of the company’s mantra seems to have tilted toward prioritizing hardware over software.

”Windows: 300M+ devices a year,” the slide notes. “Success in phone is important to success in tablets. Success in tablets will help PCs.” Elsewhere on the page, Microsoft notes that “high value experiences light up on great devices”.

”We will take additional steps to promote the app ecosytem for Windows,” the deck adds.

Slide 15 of Microsoft’s presentation to investors suggests the company is looking to juice all hardware sales with phone buzz.

It firmly cements a drift away from Microsoft’s historical PC-centric focus. But Microsoft’s no stranger to realpolitik: If the market’s moving in the direction of the smartphone and tablet, Microsoft will follow.

The slide deck will apparently be used as the basis for Microsoft’s conference call with Wall Street analysts Tuesday morning, when Microsoft will explain how the Nokia acquisition will fit in with its current strategy.

In July, Microsoft chief executive Steve Ballmer reorganized the company, flattening the company’s organizational structure and pushing technologies, not products, across Microsoft. What Ballmer and Microsoft clearly hope to do is continue that trend, and make the Windows Phone platform the focus of the Nokia deal, not the Lumia hardware. If hardware partners buy that argument, then Microsoft will have won a key battle of perception.

But that’s a long shot. Microsoft will have its work cut out to convince companies like HTC that they still have a place at the Windows Phone table. The smart money says that Microsoft may not bother: According to AdDuplex, Nokia’s phones represent under 10 percent of all Windows Phone ad traffic, and they’re declining. Nokia owns 85 percent of the Windows Phone market, and its own share is heading up.

”My take on the slide overall is highlighting the halo effect and leverage,” Reticle Research and former NPD analyst Ross Rubin said via a Twitter message on Monday night.

The conclusion, then, is that Microsoft plans to go it alone, and with its own hardware. And why not? Microsoft’s Xbox dominated the U.S. game console market for over two years, with Microsoft’s brand on the box. The Xbox One hopes to continue the trend. Although Microsoft will continue to sell Nokia’s branded featurephones, it’s a likely bet that it will facilitate a quick transition to smartphones as fast as it can. And if Nokia’s engineering teams can build a tablet, than the Surface may gain some competition.

Consumers haven’t shown that Microsoft’s operating system platforms will make them open their wallets. But the Xbox, Xbox One, the recent Nokia Lumia 1020, and (to a far lesser extent) the Surface tablet show that consumers are still interested in Microsoft-branded products, as long as they’re great devices.

”My take on the slide overall is highlighting the halo effect and leverage,” Reticle Research and former NPD analyst Ross Rubin said via a Twitter message on Monday night. “[It] addresses oversimplifying critics who might say, oh, you’re going all in on phones so PCs are dead, right?”

Microsoft certainly isn’t ignoring the patent portion of the deal. After all, that’s what the conventional wisdom says drove Google’s purchase of Motorola. But Microsoft’s concerns are far more practical: It just has to sell devices, period.

If phones are what consumers are buying, not PCs, then Microsoft can move to where the puck is. But Microsoft’s entertainment (Xbox) business isn’t a money-maker; its business and server businesses are. At this point, putting more devices in consumer hands is paramount, regardless of those devices’ use cases and form factors. Devices are what consumers are buying, but services are what Microsoft wants to sell. As long as Nokia’s phones can run Office in some fashion and connect to a server, Microsoft appears to be happy.

Will Wall Street buy that argument? We’ll find out later on Tuesday.

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NSA-dodging mail service explains why email can never truly be private and secure

Earlier this month, Lavabit and Silent Circle—two privacy-minded email providers—decided to shut up shop rather than give the U.S. government the chance to access to their customer data. Shortly thereafter, Lavabit owner Ladar Levison told Forbes, "If you knew what I knew about email, you might not use it."

This weekend, Silent Circle's Louis Kowolowski dropped the cryptic comments and explained a major, inherent vulnerability with email: metadata.

While encryption technologies like PGP and SMIME can be used to obscure the actual contents of a message, assuming you use a desktop program that supports encryption software, current email protocols don't allow you to secure the "header" metadata details that are used to shuffle email from point to point. The sender, recipient, subject, date and time, and even server path information is all sent along in clear text.

That's enough to be a liability to people who truly need privacy, according to Kowolowski.

If your goal is to not have metadata leakage in your otherwise secure communications, you may wish to avoid email altogether. Email leaks the information about who is communicating, and how often. This information may be just as damaging as the content of the email.

Snowden's leaks have shown that the U.S. government is aware of the power of metadata. The NSA collects Verizon's phone records to examine metadata and analyze call patterns, and the government does not need individual warrants to do so, as courts have classified metadata as "transactional data" rather than actual communications. Again, here's Kowolowski:

With the tapping of backbone internet providers, interested parties can now see all traffic on the internet. The days where it was possible for two people to have a truly private conversation over email, if they ever existed, are long over.

Since text, video, and messaging communications don't suffer from the same header needs as email, they're able to be secured from end-to-end, with all encryption and decryption handled on the client machines—and indeed, Silent Circle still offers "Silent Phone," "Silent Eyes," and "Silent Text" services that do just that. Check out our guiding to protecting your PC from Prism surveillance for more privacy-minded tips and tricks, or if metadata security means less than the message itself, read PCWorld's guide to securing your email.

Brad Chacos spends the days jamming to Spotify, digging through desktop PCs and covering everything from BYOD tablets to DIY tesla coils.
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