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Originally Posted by Sil_liS
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Originally Posted by leebase
The publishers were responding to a rogue client, Amazon, who was selling the entire best seller's list at a loss in order to dominate the market. It was not in the publisher's best interest for this to continue.
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What makes you think that Amazon was selling at a loss? Amazon is already established in functioning online. They are optimized for this. If they get the books 50% off from the publisher and sell them 30% off, they have 20% of the price to cover expenses and make a profit. Plus, the more ebooks they sell, the more kindles they sell. |
Selling more Kindles is a minor benefit. What Amazon wants is to sell you ebooks. It's why I was unsurprised when the Kindle app for various platforms arrived. The Kindle was priming the ebook pump.
eBooks are a natural fit for Amazon. As you say, they are optimized for online sales. They are the world's largest catalog retailer. They already have a highly developed infrastructure to display items and take orders. Adding the ability to provide fulfillment via an immediate download was a simple extension of existing capabilities. eBooks don't require warehousing, and distribution is a download from an Amazon server.
Amazon uses a proprietary DRM scheme based on a modified version of MobiPocket DRM. The intent isn't so much preventing piracy as locking you in to Amazon as your vendor. If you want to read a published commercial title protected by DRM with your Kindle or Kindle app, you have to buy it from Amazon. You can side load Mobi format books not protected by DRM and read them, but in general, if you're
buying the book, Amazon wants a cut of the sale.
They have pricing and selection sufficient that most Kindle owners don't see vendor lock-in as onerous.
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And why would the publishers have a problem with that? If they really didn't want to work with Amazon anymore, they could just stop using Amazon as a retailer.
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Oh, really? Amazon is probably the single largest book retailer in the world. A significant part of any publisher's revenue will come from sales through Amazon. You
don't simply decide to stop working with them. Depending upon who you are, you may not survive without them.
There was a brief period during the flap that led to the Agency Model when books from publishers who adopted the Agency Model refused to sell books through Amazon - Amazon had raised the stakes by further discounting popular titles to $7.99 from their default $9.99. That didn't last long. There were too many reasons for both sides to reach an agreement and continue doing business.
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Dennis