The US Justice Department has filed a competition case against Apple and publishers over e-book pricing.

Before the introduction of Apple's iPad in April 2010, online retail giant Amazon, maker of the Kindle e-book reader, sold electronic versions of many new best sellers for $9.99.

But Apple forced a change in pricing for e-books when the iPad emerged as a rival e-book reading platform.

It moved publishers to a so-called "agency model" which calls for them to set book prices and for Apple to take a 30% cut.

European competition officials announced in December they were conducting a probe into Apple and the five publishers to determine whether they had struck illegal deals to fix the prices of e-books in Europe.

But Apple has received support from the Authors Guild, which contends that Apple helped boost competition against Amazon, which had dominated the market previously.

The five publishers believed to be under investigation were CBS Corp's Simon & Schuster, Lagardere SCA's Hachette Book Group, Pearson's Penguin Group (USA); Macmillan, a unit of Verlagsgruppe Georg von Holtzbrinck, and HarperCollins, a unit of News Corp., which owns The Wall Street Journal.

Apple's market value hits $600 billion

Apple, already the world's most valuable company, hit the $600 billion level for the first time yesterday.

Only one other company has been worth $600 billion - Apple's old sparring partner Microsoft.

It reached that valuation for 13 trading days in 1999, at the peak of the tech stock mania.

At its highest level, on December 30, 1999, Microsoft's valuation was $619 billion. It is now worth about $255 billion.

General Electric came just short of reaching a $600 billion valuation in August 2000.

Apple shares hit $644 in morning trading yesterday, up 1.2% from Monday's close. At that price, the entire company was worth $600.4 billion. By midday, the shares had retreated and the the stock closed at $628.44, down 1.2% from the day before, putting the value below $600 billion again.

Apple's stock is up nearly 60% since the start of the year, an indication that investors are catching up to what analysts have been saying for a while - that despite its enormous market capitalisation, Apple's stock has been undervalued relative to its even more enormous profits.

The rally has also been fueled by the report of another strong holiday quarter, and the announcement that Apple will start putting its $97.6 billion cash hoard to use this summer by paying a dividend and buying back shares.

Apple's market capitalisation had hit $500 billion on Febuary 29. That, in itself, was a rare achievement: Only five other US companies have ever been worth that much.

China's largest oil company, PetroChina, was briefly worth $1 trillion after it listed on the Shanghai stock exchange in 2007, but only based on its price on that exchange. Its shares also trade in Hong Kong and on the New York Stock Exchange. Based on trading there, its market capitalisation has never reached $500 billion.