Comments on: Publishing Insider Tipped Law Firms About E-Book Price Fixing Conspiracy

By: Sue

Sue — Sat, 14 Jan 2012 20:37:21 +0000

Before Apple/publisher price fixing I bought an ebook for 4.39. After the price fixing, the same ebook is now 8.99.

By: Bob

Bob — Wed, 04 Jan 2012 12:40:44 +0000

Steve, if Amazon set their prices “all over the map”, then why do they place
This price was set by the publisher right underneath the price?

By: Lucian Armasu

Lucian Armasu — Wed, 21 Dec 2011 09:18:29 +0000

Why do you keep calling it a conspiracy if a publisher tipped the law firms? It’s not much of a “conspiracy” when someone from the inside confirms it, is it?

By: Steve

Steve — Wed, 21 Dec 2011 00:59:23 +0000

Amazon chooses the price every book sells for to optimize profits for Amazon. Amazon’s prices are all over the map depending on what price will drive the most volume in their opinion. Many higher end publishers won’t touch Amazon because of this.

By: Rift

Rift — Wed, 21 Dec 2011 00:44:18 +0000

Except that’s the opposite of what happened. Amazon was the one trying to standardize 9.99 as the price for new e-books. Apple worked with the publishers to implement the agency model, where the publishers were able to set whatever price they wanted.

By: Steve

Steve — Wed, 21 Dec 2011 00:23:38 +0000

Amazon’s pricing strategy is to give away the razor handle and sell the blades. Hence they can sell Kindle’s including the new Fire at a loss.

Ignore all the reports they are selling the Fire at cost. Those morons don’t understand that products sell for far above the price of the parts because real businesses have to cover the cost of sales & marketing, general overhead, support, and so on.

Amazon’s strategy is to seed the market with low cost devices so that consumers will buy their overpriced content.

Apple’s strategy is to sell world class products at a profit and make a small profit on every piece of content.

Apple didn’t force Amazon to do anything. They simply called the bluff on their strategy.

By: crescentmage

crescentmage — Tue, 20 Dec 2011 23:09:17 +0000

There is a lot more to the story. Amazon initially sold ebooks under a wholesale model, where publishers sold them to Amazon for a price, and Amazon could set its own price to end users, even if that price was lower than the wholesale price.

When Apple entered the ebook market, Apple worked with the publishers to adopt an “agency model” and force vendors to sell ebooks at prices set by the publisher rather than the eseller. Apple’s market power was enough to force Amazon to give in to the publishers and adopt this model as well. I’m not familiar enough with anti-trust law to know if they crossed a line, but I don’t know that things are as clear-cut as you make them sound.

By: Steve

Steve — Tue, 20 Dec 2011 18:54:42 +0000

Let me preview Apple’s defense:

This is exactly the same approach we took with pricing songs for iTunes. We found a price that worked for each of the major publishers and worked with each of them to end at $9.99 for consistency in our store.

We did not collude to set the prices of books in the Amazon Store, the B&N store, the Google store and so forth.

There is no crime here. Merely good business negotiation tactics as one of many competitors in a crowded space.