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Re: setting the price of a Ford.
Let's use that to understand what was going on. Everyone knows you don't pay the "sticker price" for a car. But depending on your haggling skills and the dealer's need to sell a car -- the price of a car can vary quite a bit.
But WHAT IF -- Amazon Motors started selling fully loaded, brand new, Ford Focus's for $10,000. Even though Ford charges Amazon Motors $15,000 for the car, and it's sticker price is $30,000. Why should Ford care if Amazon Motors is willing to lose money on every car it sold?
Well...consider that Amazon Motors is the largest seller of Ford cars with near universal name recognition and the ability to sell a car to anybody anywhere? Surely people would be in love with Amazon Motors and the $10,000 price for the car.
What about Ford's other dealers? How are they going to feel about Ford allowing this to happen. For this is no "end of the month" sale to meet a sales goal. This is all the top model cars Ford sells -- all the time. How can Ford expect it's other dealers to keep trying to sell Ford cars in competition with Amazon Motors who's willing to lose money?
PLUS -- people are getting the idea that $10,000 is the proper price for a brand new Ford car. Ford would know that it wouldn't be long before all the other Ford dealers were run out of business and then Amazon could force Ford to sell it's car for LESS than $10,000.
Ok. Make it more clear? $10 has not been the price for new release popular books. McMillian isn't trying to "raise the price of a book" -- they are trying to stop Amazon from turning the entire NYT Bestseller's list into a product that customers are only willing to pay $10 for. No one has been complaining that hardbacks are listed at $25 to $30 and sold "on sale" for $18. People know "I'll wait for the paper back". But with ebooks, Amazon was training people to want the cheap version of the book up front -- destroying the pricing levels that the publishers have already established.
Had Amazon not been wiling to change -- the publishers were going to withhold their ebooks just like they withhold the paper backs. The ANGER over this is PROOF that Amazon had indeed been spoiling the market (from the publisher's perspective).
Lee
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