Question: Amazon com became the world s largest e book seller by offering new
Amazon.com became the world’s largest e-book seller by offering new bestselling books for a fixed price of $9.99 regardless of the fame and popularity of the author or the prestige of the publisher. But some publishers have balked at Amazon’s e-book pricing strategy. They believe that over time, the $9.99 price will create a ceiling for consumer price perception about the value of new books. If consumers believe new books from famed authors and top publishers are worth no more than $9.99, the publishers’ ability to price their products at what they believe them to be worth will be undermined or destroyed completely. In early 2010, five publishers, including Macmillan, one of the largest and most prestigious book publishers, refused to offer their books through Amazon’s Kindle e-books and instead decided to distribute their e-book list through Apple’s iPad, which allows the publisher to set the price. Some of the e-books distributed through Apple will be priced at $14.99. Who do you think should control the pricing of e-book best sellers in the marketing channel? Why?
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