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Amazon's prices on p-books are still lower than list. I think you're right that some of the more marginal sellers of ebooks are going to have trouble with Amazon putting price pressure on, but overall I think this is going to force publishers to lower the list prices of ebooks, and I think that's a good thing for everyone (including the other ebook vendors). Ebooks are on their way to becoming a commodity product, so ultimately, survival should be based on what the ebook vendor brings to the process. Currently, that's very little in most cases. Amazon has customer reviews, book recommendations, and the "search inside" feature in addition to ease of use and low prices. I'd like to see some of the other ebook vendors think about adding features to their sites if they want to compete. For example, someone could implement a DotReader-like book club discussion system, or try to get individual authors on board to write blogs (though Amazon does this, too), or --gasp!-- drop DRM in an attempt to be more competitive. This is what the market needs, I think.
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