Amazon is showing once more that it’s willing to use its online retailing might to try to get what it wants from its publisher partners.
Back in January, Amazon removed all titles from publisher Macmillan after the two companies had a disagreement about the pricing of e-books in Amazon’s store. (Amazon later said, “We will have to accept Macmillan’s terms.”)
Now, Amazon has reached agreements with four of the five major publishers on an “agency” pricing model for e-books, where the publishers set the prices. Details of the agreements haven’t yet been disclosed, but Penguin has refused to sign on. It was the lone holdout. As a result, Amazon had to stop selling the publisher’s e-books as of April 1. The retailer appears to be retaliating, as first reported by The Wall Street Journal — not by removing books, but by dramatically lowering the prices on hardcovers. Amazon is taking the loss of revenue, but the Journal says publishers hate those price cuts, because they lower the value of the book in the eye of the consumer.
For example, the hardcover of Roger Lowenstein’s “The End of Wall Street” has a full price of $27.95, and Barnes & Noble’s website is selling it for $15.37. On Amazon, it’s $9.99. Or there’s Anne Lamott’s “Imperfect Birds” — $25.95 full price, $18.68 on Barnes and Noble, $9.99 on Amazon.
The Journal says neither Amazon nor Penguin is commenting on the story. We’ve emailed Amazon as well, but have not received a response.