Barnes and Noble’s Nook Sales Hurt by Amazon’s Lower E-Book Prices

Brad Stone, writing for Businessweek:

Some of the blame here lies with the U.S. Department of Justice. Its successful lawsuit against Apple and major book publishers, for conspiring to set fixed, industrywide prices on e-books, now allows Amazon to set its own often ridiculously low prices. “The Justice Department came in at a time when agency pricing was weakening Amazon’s hold and dispersing the e-book market,” says Mike Shatzkin, CEO of the Idea Logical, a book industry consultancy. “By eliminating fixed prices for e-books, they have handed the advantage back to Amazon. Now everyone else is losing share.”

So the result of a successful DOJ antitrust case is that the undisputed market leader, Amazon, is better able to destroy smaller competitors through predatory pricing. Got it.

Thursday, 9 January 2014

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