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Originally Posted by Barcey
Amazon was not the only one that was selling best sellers for $9.99. The other sites were as well. I didn't see Amazon lower the price below $9.99 to respond.
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Amazon
did briefly lower the price of some current titles to $7.99, as part of their tussle with the Agency Model folks.
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Kobo had a presentation where they showed sales volumes at different price point and it clearly showed that the most volume was moving at the $10 price point.
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Because that was what people were accustomed to from Amazon.
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This wasn't about Amazon trying to dominate the market by selling below cost. It was about Amazon demonstrating what the price point had to be and they were willing to take a temporary loss to show the publishers their price had to drop.
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Amazon conditioned the market to a defacto $9.99 price point via their Kindle editions. They didn't demonstrate what it had to be - they generated an expectation among the readers that that was what it
should be.
That was a major issue for the publishers, and the Agency Model is in large part an attempt by publishers to reestablish control over pricing. I'd call the jury still out on whether it is working. Amazon trumpets the higher sales of books that carry their default $9.99 price tag, but that's not conclusive. What we don't know is whether enough people
are buying eBooks from Amazon at the Agency Model pricing to meet the publisher's revenue and profit targets. If they
are, the Agency Model won't go way. The publishers are betting that people want the books badly enough to pay the higher price. Many will. The question is how many.
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Dennis