Publishers still missing the point on e-book prices

[tubemonkey]

Originally Posted by leebase

I left out specific company names to deal with the topic. Price dumping is a predatory practice and is not in the best interest of the consumer. It's not when the subject at hand is foreign steel, it's not when it's ebooks.

Lee

Small stores go out of business because people want them to. No one puts a gun to their heads and forces them to shop at the big box store that just moved in.

[Ken Maltby]

I expect the difference between rural and big city Walmarts, is in the number of stores,
not in their merchandise volume. The towns and cities in the USA are tied to the
transportation network. Perhaps few here remember the term "Whistle Stop". Rural
occupations and industries, like agriculture and mining, all require the means to send the
food stuff and raw materials to the city based processing and consumption. The roads
and rails go both ways.

Luck;
Ken

[anamardoll]

Originally Posted by tubemonkey

Frequently, I'll choose Amazon over Best Buy, Target, Walmart or other local stores for those reasons. Saves me a trip to the store.

I chose them for more complicated reasons -- leaving the house takes a lot of spoons for me. I wish more retailers offered reasonable shipping rates to my house.

[Andrew H.]

Originally Posted by leebase

I left out specific company names to deal with the topic. Price dumping is a predatory practice and is not in the best interest of the consumer. It's not when the subject at hand is foreign steel, it's not when it's ebooks.

Lee

Lower prices are in the best interest of the consumer. Period.

And charging a low price on some goods which is made up on other goods has a long and well established history.

[sabredog]

Originally Posted by tubemonkey

Small stores go out of business because people want them to. No one puts a gun to their heads and forces them to shop at the big box store that just moved in.

No, the gun is not pointed at their heads. The carrot on a stick makes people shop at larger stores.

People shop where they believe they can get a better price. A bigger store with greater purchasing power will offer goods at a better price, conduct more sales and offer a greater range.

Smaller stores cannot do that, or if they try, the impact is less.

Big department store and supermarket chains have seen the end of the small neighbourhood corner store and smaller specialist stores such as electrical retailers.

This is how Gerry Harvey's Harvey Norman electrical and furniture stores have impacted on local businesses here in Australia. He moves into a local area and squeezes out smaller electrical and furniture stores.

Here, Woolworths and Coles supermarkets have a virtual stranglehold. Why? because they offer all that mentioned above.

[GlennD]

I know it's not a popular thought, but "good riddance" to the small stores, in most cases. Given the choice of going to three or four different stores, I'd far rather go to a single stores that beats all of their prices (or at least comes close). I save time, money and gas. For the specialty stores, I'd far rather go to a Barnes and Noble that might have the book I want in stock, rather than a store that will happily order it for me.

I'm not saying the Walmarts of the world don't have their issues, but I'm happy with the efficiency I get as a consumer.

[stonetools]

Well, Amazon was engaging in predatory pricing of ebooks so as to establish a monopoly in the eBook retail market. That's a bit different from just being a more efficient retailer.
That's what the publishers were pushing back against. Now of course, most folk here would like to just skip over Amazon's behavior and pretend that wasn't happening, but this is the publishers' stated reason for moving to the agency model.

[HansTWN]

Originally Posted by stonetools

Well, Amazon was engaging in predatory pricing of ebooks so as to establish a monopoly in the eBook retail market. That's a bit different from just being a more efficient retailer.
That's what the publishers were pushing back against. Now of course, most folk here would like to just skip over Amazon's behavior and pretend that wasn't happening, but this is the publishers' stated reason for moving to the agency model.

That, of course, is not true. If that was all the publishers would care about (avoid predatory pricing), they could have had other ways. Not by pushing the ebook price way over the regularly discounted paperback price.

Originally Posted by HansTWN

That, of course, is not true. If that was all the publishers would care about (avoid predatory pricing), they could have had other ways. Not by pushing the ebook price way over the regularly discounted paperback price.

Yes it is true. It's called a loss leader and it's actually quite common. Retailers play that game for many reasons. In all probability Amazon is playing it to push publishers out of the picture. After all, Amazon has taken over many of the functions of a traditional publisher. Amazon is very effective at getting products into market channels (they are the market channel), they are the 'printer' (when it comes down to ebooks), and they are very effective at marketing. Customer reviews also take over the 'filtering' role of publishers. For simple books, the author is effectively taking care of typesetting. That doesn't leave very much for the publisher to do.

[sabredog]

Some people also conveniently forget that Apple also had a hand in orchestrating agency pricing as well.

[stonetools]

Originally Posted by HansTWN

That, of course, is not true. If that was all the publishers would care about (avoid predatory pricing), they could have had other ways. Not by pushing the ebook price way over the regularly discounted paperback price.

Other ways like what?

You do know that in many industries, manufacturers dictate prices and that the courts have explicitly allowed this?
Look up "resale price maintenance".

[cHex]

Monopoly? Again? Just because a company (whose investors waited years and years for profit) took measures to gain market share?

1. Numerous brick-and-mortar bookstores exist in competition to Amazon.com, with several significant advantages over an online-only company.

2. Services exist which will convert any book into an eBook for $1.

3. Anybody with a scanner and OCR software and the time to spare can convert any book into an eBook.

4. Libraries make books, including eBooks, available for free. Used bookstores offer used books for sale, sometimes at a steep markup but more often at a significant discount.

5. Numerous other online channels for purchasing books exist in competition to Amazon.com. Calling whichever happens to offer the lowest price to consumers for eBooks a "predator" set on "establishing a monopoly" is premature.

Amazon.com had a new, more efficient, and definitely better-conceived business plan. It had every right to expect to steal market share. (As far as I know, "market share" has not yet been claimed to be an actual stealable possession yet.) Authors, previously published by the traditional publishers that justified higher prices for eBooks than for paperbacks "in order to cover expenses," are finding they can make a bigger profit publishing their books through Amazon and selling them for $0.99.

I believe it is clear that the old publishing models are outdated. I believe Amazon.com saw this earlier than most. While I believe the demand for pBooks will continue for many many years yet, I believe 10 years from now they will be published under quite some different model than the publishers are defending right now--unless they succeed in establishing legislation that artificially constrains the market.

Finally, should Amazon.com ever decide they have achieved a monopoly, and "cash in" by raising the prices on their goods to gouge consumers, I believe any number of new competitors will step forward with cut-throat "predatory pricing" intending to "establish monopolies" of their own.

[HansTWN]

Originally Posted by stonetools

Other ways like what?

You do know that in many industries, manufacturers dictate prices and that the courts have explicitly allowed this?
Look up "resale price maintenance".

We are talking 5 publishers coming together and institute a new system (that raises prices by about 50%) on the very same day. Anyway, prosecutors are working on it.

And as for your example, have you ever heard of grey imports? Yes, manufacturers can dictate prices. But separately.

Now imagine, Toyota, Ford, GM, VW, Hyundai, etc got together and decided to dictate enduser prices to their dealers starting May 1st, 2012 --- enduser prices that are, on average, just 15% higher than current actual sales prices (let us not go all out like the publishers). What would happen?

Sure, Saturn did it many years ago (they allowed absolutely no discounts). But 80% of the industry, starting the same system on the same day?

[stonetools]

Amazon.com had a new, more efficient, and definitely better-conceived business plan. It had every right to expect to steal market share. (

Wait a second, what's so new about using ebooks as loss leaders to increase traffic ? Walmart has done that for a long time ( and supermarkets before them).
Anyway, what's sauce for the goose is sauce for the gander? If Amazon can use the loss-leader strategy as part of its business plan to monopolizethe market, the publishers have every right to use countervailing strategies to block Amazon.

[CyGuy]

Originally Posted by HansTWN

We are talking 5 publishers coming together and institute a new system (that raises prices by about 50%) on the very same day. Anyway, prosecutors are working on it.

I am certain that they will be found guilty of price fixing and will not be allowed to get away with this for much longer, at least I hope not.