Quote:
Originally Posted by Hrafn
Why? Because they'd still have to pay 70% of $14.99, which is $10.49 to Hatchette, so they'd lose money on each book. Hatchette would still make this same $10.49 per book, but on 74% more books, so they'd nearly double their revenue without having to actually do anything.
Does that sound like sound business practice to you?
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The fallacy in your argument is that you are assuming that Hachette would sell 74% more books. The numbers Amazon gave were over its entire catalog, not just the Hachette catalog, and the numbers only pertain to Amazon's customer base, which does not include all of the other outlets that sell Hachette books.
I suspect that if Amazon were willing to guarantee that increase over the full distribution chain, Hachette would agree. But I also suspect that Amazon is unwilling to even guarantee such a sales increase among its own customers.
As to whether it is a good business plan or not, I cannot say. There is too much missing data that is fundamental to making a sound business decision. I'm surprised that anyone here on MR believes they have enough data to determine who is objectively right or wrong in this dispute.