"Publishers didn’t like the fact that Amazon.com started selling e-books for $9.99 each. (They thought that was too cheap, if you’re wondering.) It didn’t affect publishers’ margins, nor authors’ royalties, since Amazon.com was selling below cost to promote its Kindle platform. But still, publishers were uncomfortable with the idea of books being that cheap. So they went to war and forced Amazon.com to bump up prices to $13-$15, in exchange for taking a lower royalty on each sale.
Let’s review. Amazon.com was eating it in order to allow you to buy books for ten bucks, instead of twenty or thirty, while paying authors the same royalty. Publisher intervenes, and now books are more expensive for you, while the author gets less. Also, the publisher gets less. Oh, and I didn’t mention this, but during the war, Amazon.com took down all the “Buy” buttons for Macmillan books, so you definitely couldn’t buy them no matter how much you wanted to and nobody made any money at all. "
I thought these companies love saying how they have an obligation to make their shareholders money?
The appearance of a significantly "cheaper" version of the product cheapens the brand, and makes customers wonder why they are paying so much. Potentially killing the rest of the product line-up. It has happened to every industry several times before, including the book industry.
Yeah but in most industries it's illegal to control the price that retailers distribute your product at. This was temporary pricing anyway to encourage interest in the online platform over the longer term.
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[ 3.4 ms ] story [ 16.7 ms ] thread"Publishers didn’t like the fact that Amazon.com started selling e-books for $9.99 each. (They thought that was too cheap, if you’re wondering.) It didn’t affect publishers’ margins, nor authors’ royalties, since Amazon.com was selling below cost to promote its Kindle platform. But still, publishers were uncomfortable with the idea of books being that cheap. So they went to war and forced Amazon.com to bump up prices to $13-$15, in exchange for taking a lower royalty on each sale.
Let’s review. Amazon.com was eating it in order to allow you to buy books for ten bucks, instead of twenty or thirty, while paying authors the same royalty. Publisher intervenes, and now books are more expensive for you, while the author gets less. Also, the publisher gets less. Oh, and I didn’t mention this, but during the war, Amazon.com took down all the “Buy” buttons for Macmillan books, so you definitely couldn’t buy them no matter how much you wanted to and nobody made any money at all. "
I thought these companies love saying how they have an obligation to make their shareholders money?
The customers were not told the price was temporary, just that it was the default. The customer's perception was what mattered to the publishers.