Quote:
Originally Posted by HoraceWimp
Quote:
First, there’s the wholesale model, the way that book publishers have sold printed books to bookstores and other outlets for years. The publisher sets a cover price for a book, sells it to a retailer at a discount (typically 50 percent) and then the retailer can sell the book to consumers for whatever price it chooses.
The other method of selling books is via the agency model, which means, essentially, on commission. The retailer offers the book to consumers at a price the publisher sets and gets a percentage of whatever sales are made. It’s rare for print books to be sold in this way, but it’s the method Apple uses to sell content like music and apps in its iTunes store.
Until 2010 — as Andrew Albanese explains in his admirably lucid “The Battle of $9.99: How Apple, Amazon and the ‘Big Six’ Publishers Changed the E-Book Business Overnight,” a new “e-single” published by Publishers Weekly — book publishers had been selling e-books to Amazon using the wholesale model. They’d simply adapted the system they were already using to sell print books to the online retailer. This, they would soon realize, was a big mistake.
The wholesale model is widely seen as an odd way to sell e-books, since what the purchaser buys is “licensed access” to a digital file, rather than a physical object like a book. But what would torment publishers most about this arrangement was the freedom the wholesale model gave to Amazon to set the prices of e-books.
Source: http://www.salon.com/2013/07/01/ever...ook_price_war/ |
I fully understand the difference between the wholesale and agency models.
However, even with both on the wholesale model, there is no evidence whatsoever that the price Amazon pays for an eBook is based off the price of the paper edition, making your previous contention that the much lower price of the Kindle edition in comparison to the paper edition was predatory pricing somewhat difficult to defend.