From a preliminary paper by Michael Baye, Babur De los Santo and Matthijs Wildenbeest:
What it shows is average book prices over time for paperbacks and then eBooks sold under the agency model and the wholesale model. Now I should stress it is average book prices and it is not weighted by quantity sold. As best-sellers are typically discounted this means that the prices involved are likely higher than what we normally observed.
The two relevant dates are when the DOJ first launched its case against the publishers and Apple and then when it settled with three of the publishers. Notice that the wholesale book prices jumped up around the time of the lawsuit. As the major publishers were all apparently operating under the agency model, the movement in wholesale model pricing, this suggests that either/and (a) smaller publishers saw the lawsuit and thought they were under pricing their books or (b) Amazon changed its retail pricing for books under the wholesale model. The latter seems to have a greater likelihood given that the prices then fell when the settlement arose and, in particular, the most favoured nation clauses were struck out.
Importantly, it should be noted that Apple and its actions are not part of any story I can think of for this very sizeable variation in prices observed in this graph. But what the precise story is, seems puzzling and worthy of more thought.