Quote:
Originally Posted by bookwerm
The $9.99 (or $9) price point is Amazon (and Wal-Mart's) use of a loss leader strategy, where the retailer sells a product below their cost to acquire that product in the hope that consumers will buy the discount product AS WELL AS other products in the store.
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I agree that Amazon isn't planning on loosing money in the long term, and may not be loosing money overall today on ebooks (or on ebook-buying customers). The issue, though, is whether an ebook issued 4 months after a hardcover is a "leader", and therefore worth Amazon's time to deeply discount it. If not, how many $25-30 ebooks are these publishers going to sell.
I am also ok with the 4 month lag, if this implies a lower cost (lower list price). With the possible exception of audio books, this is the way it typically works in book publishing. Paperbacks cost less than trade paperbacks which cost less than hardcovers, and this is partially an indication of the reader's impression of quality but much more an indication of release date.