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Originally Posted by pilotbob
Although I don't know how amazon taking a loss is going to hurt the publishers or change their minds. Unless he figures the other ebook retailers that don't want to take a loss on these books will together put pressure on the publishers buy not selling these books, or whatever.
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Amazon is all about market share. In an economy devoted to the quick return, Amazon had the courage to base their strategy on the long term. They have taken enormous flak from investors and commentators over their low margins and small profits. And each year their share of the market has grown because their stuff is cheaper and their service is better. Their profits are still pitiful for a concern of their size but who cares, they are gradually putting everyone else out of business.
I assume they will not change the business model for ebooks – in fact it works even better. They own the most popular format and their hardware standard will soon be the main game in town. So they have a few loss leaders. Who cares? We will all soon be locked into their format. Compared to the competition that Amazon have already trounced, the ebook retailers are extremely small beer.
It is the publishers who should worry. Ask yourself what would happen if Amazon set up their own publishing house and signed a basketful of the world’s top authors. Would anyone (in the real world) actually notice that Random House, for instance, had disappeared?