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Originally Posted by curtw
Amazon's $9.99 price was *only* designed to eliminate the competition, no matter how much you feel it benefited you, the customer.
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No, it was designed to get people to buy e-book readers in the first place. Amazon made e-readers mainstream by providing both an e-reader and a well-stocked store. That's what gave them their initial 90% marketshare - the fact that there was no real competition.
And note that the $9.99 price was applied to NY times bestsellers - a group of about 40 books out of the million or so books offered.
The Nook was the first real competition to the Kindle, using a similar model plus (initially) cheaper hardware prices. The Nook quickly took about 1/4 of the market. By the time the iPad was introduced, Amazon was down to about 65% of the US e-book market. Note that agency pricing hasn't really reduced Amazon's marketshare (it may be 60% now), but it has driven a lot of independent competitors out of business.
Apple's claim that they were fighting an evil monopoly is basically just self-serving hot air. While I think it might be more difficult to pin price fixing on Apple as opposed to the publishers, they certainly weren't doing consumers any favors.
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In the long run, if Amazon had been able to establish a monopoly in e-books, how much do you think books would cost?
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They would cost exactly the same. If Amazon (or any company) is able to successfully get 90% of the market by charging low prices, they aren't going to start charging high prices and lose market share.
There is this tinfoil-hat conspiracy holding that it's bad for a company to offer low prices because then they will outcompete the competition and, when they are gone, raise prices. However, this *never* happens. People have been claiming this about Walmart for decades, and we're still waiting for them to raise prices.