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Amazon is no innocent in this. There's a big difference between Walmart buying 2 million copies of Harry Potter and selling them as loss leaders -- and selling EVERY NYT best selling book as a loss leader -- all the time.
But Amazon did have a practical monopoly on ebook distribution. The arrival of the iPad changed that. However, change was coming regardless.
Amazon had a choice. Either allow the agency model pricing -- or settle for having the ebooks delayed like paper books. With Apple going with the agency model, it was not possible for Amazon to accept the delay.
That said -- I am baffled by Penguin's pricing. I've never worried about agency pricing as the market will speak and pricing will come in line. I think Penguin's about to learn that lesson.
Lee
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