I'm not defending Amazon. If they want me to defend them they should be pushing for ebooks at a baseline of $4.99, not $9.99.
We seem to have different definitions of baseline: to me, baseline is the expected price for the category. Anybody wanting to go higher would need a very good excuse.
Like in console gaming: $60 is the baseline for AAA XBOX/PS3 titles. A few games come in special editions that run anywhere from $10 to $40 extra, but they have to make a strong case that the extras are worth the premium. Going higher than the baseline is rare.
That is how I read Amazon's statement: run of the mill midlist and even most name author ebooks (which, name or no name, are nothing special) should run at the baseline or lower. The occasional Harry Potter-type event release might command a slight premium but those would be as rare as the $99 console game.