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Originally Posted by BuddyBoy
Not undercutting your dealer is not an issue of supply, it's an issue of business survival. Trust me, you do not want to undercut the people who are selling your product for you or they will simply stop carrying your line. It's one of the ultimate no-nos in business. The only way you can ever do it without burning your bridges is by "fencing" your deal so that casual customers are unaware or ineligible. And that can offend customers. Ah life!
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There is a reason that Disney is the only studio selling movies on iTunes, and the grapevine says that reason is called "WalMart". If by selling a few million on iTunes you give up selling tens of millions at retail, you're gonna go retail.
Furthermore, has anyone done any market studies to see if reducing the price of ebooks would actually increase sales? Sounds counter-intuitive, but I'm willing to bet that if the current $25 hardcover best seller were sold for $1 as an ebook, there would be a big discussion about what under-valuing a product does to its market perception.