Thread: Stars fall in Amazon protest about ebook prices
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Old 11-10-2010, 02:14 PM   #179
Kali Yuga
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Quote:
Originally Posted by Barcey View Post
Companies don't normally enter into anti-competitive business practices to lower prices. If you have any examples I'd love to hear it.
Uh... it's not that you "illegally collaborate with the intent of making prices lower." It's that you "lower prices with an anticompetitive intent."

You also have situations with "predatory pricing," where a company will intentionally lower prices in order to eliminate the competition -- which is pretty much what Amazon was doing prior to the agency model. However, it is worth noting that this is a very expensive strategy, and as such rarely works.


Quote:
Originally Posted by Barcey
The retail marketplace is built on competing with price and service and restraint of either is anti-competitive.
Not necessarily. That was the point of the Leegin ruling.

If you can prove in court that your actions end up offering an overall benefit to competition, then it is legal. E.g. offering every retailer the exact same costs and prices does prevent retailers from using price to compete against one another -- but it can also be seen as leveling one playing field, and leaving it to the retailers to compete on other grounds like customer service, advertising and so forth.

In addition, the publishers are not using agency pricing to restrict the competition of the non-agency publishers. E.g. Penguin is not pulling its books with the demand that Apple refrain from selling O'Reilly titles.


Quote:
Originally Posted by Barcey
If they want to fix the prices then sell direct. Don't pretend there is competition. If you want to leverage the retail chain then let them compete.
Oh?

Remember travel agents? They do not set any prices, and are not subsidiaries of the vendors they offer. Yet their existence was not evidence of "anti-competitive behavior" on the parts of the airlines, cruise lines or hotels. You could go to 2 different travel agents and wind up paying the exact same cost for the same itinerary.

Plus, the retailers still benefit. Not only do they get their cut, but they are now in direct competition with the publishers -- as evidenced by Amazon cutting deals directly with authors.

Should Amazon strictly act as a retailer, and not try to become a publisher as well...?
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