Quote:
Originally Posted by KenJackson
I think the free market can solve this fairly easily. Agency pricing should be outlawed. If a grocer can sell ketchup at a loss as a leader to get you in the store, then ebook sites should most definitely be allowed to sell big names of their choosing at a loss to draw you in too.
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Hmmm!? Agency pricing seems like a bad, non-free-market thing, so I'm against it. But I was very surprised to read what Smashword's
Mark Coker had to say about it. I'll have to think about this.
Quote:
If agency pricing is limited or overturned, it would allow Amazon to price ebooks at below cost and effectively eliminate the profitability of all its competing retailers. This would also discourage the formation of new competitors. It's ironic that the EC and US DOJ are pursuing these ill-advised campaigns that could lead to less competition in the ebook market, not more.
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Despite fears to the contrary, we see evidence at Smashwords that agency pricing might actually encourage lower book prices. Indies, which are enjoying great benefits from the agency model (Smashwords only distributes to agency retailers), are using agency to offer customers lower prices, not higher prices. The average ebook at Smashwords is priced under $5.00, and we have over 15,000 books priced at FREE. Why do indies price their books lower when they have the freedom to charge anything they want? The reason is that indies realize that consumers value fair prices, and as a result these lower prices give indies a competitive advantage over the large publishers.
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