Here’s a different take on the Amazon and Macmillan showdown. Nathan Bransford, literary agent, offers a post called The Kindle Missile Crisis. Excellent read.
I think the moral to the story is the consumer will ultimately dictate prices. (After the pirates have filled their pockets on the illicit sale of overpriced digital booty!)
We also can’t forget that if the $9.99 price was offered as a lost leader (where Amazon paid publishers more than they recouped in the sale), after initially selling (and not selling) their eBooks at $14.95 and much higher, then it was in Amazon’s best interest to shake up the market to rearrange things in Amazon’s favor. They needed a new deal to make money in a market that they know will not sustain eBooks over $9.99.
Now that Macmillan’s paying Amazon a larger percentage (Agency rates) for the right to sell their eBooks at a higher price, they’ll also be paying Amazon a larger percentage when the market drives the price of eBook titles down again. I think it’s a cunning win by Amazon. They’ll end up with a bigger percentage of a $9.99 title than they did before the disagreement.
