Thread: Death of the agency model?
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Old 04-06-2012, 01:04 PM   #113
Fbone
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Quote:
Originally Posted by Elfwreck View Post
The wholesale model for ebooks didn't require buying in lots and being responsible for unsold merchandise. It had the same pricing system as wholesale for physical objects, but the objects weren't "purchased" until a sale occurred. No risk for anyone, except for the occasional chargeback.

There's no reason ebooks couldn't be run on the wholesale pricing model: author/publisher sets their cut; distributor sets the end price to whatever they like.
Which is why Amazon's refusing IPG's terms didn't make sense. Amazon wanted lower wholesale prices than their competitors (AKA most favored nation) and IPG said no. What risk was there to Amazon? They aren't stocking inventory.

Since there are reports of Amazon demanding and receiving better terms than other retailers now plus with the expected (temporarily) end to agency pricing, what hope does B&N, Sony, Kobo, etc have?
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