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Apple and Amazon in German investigation over audiobooks

Henry Mance and Tim Bradshaw
German anti-trust authorities look into Apple and Amazon
German anti-trust authorities look into Apple and Amazon

German antitrust authorities are investigating Amazon and Apple for an agreement about selling audiobooks, targeting two companies that usually find themselves on opposing sides of competition battles.

Amazon, through its subsidiary Audible, is the exclusive provider of audiobooks to Apple's iTunes store in Germany. Together the two companies account for about 90 per cent of audiobooks sold in the country, according to industry estimates.

"Both companies hold a strong position in the market for digital audiobooks in Germany," said Andreas Mundt, president of the Federal Cartel Office. "We therefore see ourselves obliged to examine more closely the agreement between these two competitors."

The Federal Cartel Office opened the investigation after receiving a complaint from the German Publishers and Booksellers Association, which alleged Apple and Amazon were "on the way to establishing a monopoly".

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The complaint, made public in September, has also been sent to the European Commission, which is investigating separate allegations of market abuse by Amazon in the ebooks sector.

The publishing industry has seen several competition investigations, as Amazon, Apple and other companies battle for sales in the digital market.

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Apple and Amazon are typically publishing competitors, and have found themselves on opposing sides of investigations.

In the US, Apple lost an appeal this summer against an antitrust verdict that found it conspired with publishers to raise ebook prices in its iBooks store, in a partnership aimed squarely against Amazon's Kindle ebook reader.

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Earlier this year, the European Commission began an investigation into Apple's deals with the music industry, as it prepared to launch a new subscription streaming service based on its $3bn acquisition of Beats last year. However, Europe's antitrust investigators have not found evidence of wrongdoing.

German consumers are among the world's biggest buyers of audiobooks, in a global market estimated to be worth around $2.5bn a year. In March, Rakuten, the Japanese ecommerce group whose Kobo ereader competes with Kindle and iBooks, paid $410m to acquire Overdrive, a US-based distributor of ebooks and audiobooks.

Amazon bought Audible for $300m in 2008. Audible became the exclusive provider of spoken word content on iTunes in the US in 2003, and subsequently in Germany, France and the UK in 2004.

Apple and Amazon did not immediately respond to requests for comment.