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Originally Posted by Kali Yuga
OK, but... why?
With paper goods, the retailer purchases the book from the publisher and resells it. As such, they have paid for it, they're taking more risk, so if they want to lose on the deal that's their choice. With ebooks, they're more an aggregator. It's a different process, a different relationship, thus a different pricing method.
The publishers are also getting sales figures in almost real time. As such, while the retailer and publisher won't have the same incentives, the publishers can be almost as responsive to sales fluctuations as the retailers.
Also, as mentioned already, when an author or small publisher works through Smashwords or CreateSpace or a similar service, it is that author/small pub that sets the price. Same for the various App Stores, which allow publishers to set prices. How is this any different than agency pricing? It sounds exactly the same to me, except in terms of scale.
In terms of competition:
A big retailer may order 20,000 copies of a new book and demand a wholesale price of $9.00. An indie shop, on the other hand, may only need 2 copies. That results in either paying the publisher full price ($11 perhaps), or working through a distributor who in turn takes a cut.
As a result, the bigger stores can charge less for the same title -- an advantage which results in the big stores getting bigger, and the indie stores closing shop. (Which is exactly what has been going on for the last few years.) Are you sure this is good for competition?
Similarly, Walmart has enough power to "negotiate" (i.e. dictate) prices to its vendors, including major corporations, and demand excruciatingly efficient and precise delivery schedules. In doing so they can dramatically undercut other stores. Is this beneficial or anti-competitive? Or both? Or neither?
Plus, as mentioned, nothing about this prevents smaller publishers from undercutting agency publishers on price.
I do agree that in some cases prices can be too high for some buyers, but that is not a federal crime.
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I agree, If what we want is a direct to reader market, and we all want that right? Who do we expect to be setting the prices in the future?? A global AI that determines the best value to be had for the best Discworld novel? Perhaps, but for the foreseeable future the rights holder should be setting their own prices.
