Quote:
Originally Posted by kilron
there's no anti-trust issues in agency pricing. the publishers own the content and they can sell it for whatever they want. its that simple. your correlation to physical goods doesn't work (clothes, appliances, etc.) because physical goods are much more complex, but if they wanted to, manufacturers could do that as well. its just that with very small data sized electronic content, the agency model is ideal. but there's no anti-trust issues there. if you own something that is for sale, you're entitled to sell it for whatever price you want. period.
|
Yet agency pricing in a "new market" will mean a huge inflexibility on the part of the publishers in even experimenting with lowering the book prices to see if the volume increase weighs up against the lower profit/item. The reason this model is stupid is because it assumes Publishers have perfect information wrt interest, sales, etc., and will be able to respond quickly to changes in the market. This is one of the major reasons why retailers have a role to play in this process. From now on, you won't even see temporary price reductions any more.
Yet because the publishers currently seem to think that the market is still so new that they can get more of what they claim is 'competitive rent', due to some sort of silly first-mover advantage.
Only because there is a legal monopoly at work, there is no downward push through new entrants. Which means that it may very well be that they will in the end make more profits from the increased volume from selling at a lower price point, but they have no incentive whatsoever to see if this is 'already' the case.
Basically, competition is a joke here. And it saddens me to no end that this is all pushed and even actively made possible by the paragons of "free market capitalism".