Amazon Cuts Prices in Tiff With Penguin

From the Wall Street Journal:

In the latest round of the book pricing wars, Inc. has begun selling a number of new hardcover books published this month by Pearson PLC's Penguin Group (USA) for only $9.99 amid a dispute between the two companies over electronic books.

Penguin stopped providing digital editions of new titles to Amazon as of April 1 because Penguin and Amazon haven't yet struck an agreement on a new "agency" pricing model, in which publishers set the retail prices of their e-books. Out of the five major publishers that struck an agency-pricing deal with Apple Inc., Penguin is the only one that hasn't yet reached an agreement with Amazon.

Since Amazon can't sell the digital editions of Penguin's books, it is, in effect, showing its customers that Amazon is still the place to go for discount pricing. The low price also serves to put pressure on Penguin, as publishers passionately dislike the steep discounts. Many publishers say a $9.99 price tag on a new hardcover book cheapens the value in the minds of consumers.

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About Nate Hoffelder (11471 Articles)
Nate Hoffelder is the founder and editor of The Digital Reader: "I've been into reading ebooks since forever, but I only got my first ereader in July 2007. Everything quickly spiraled out of control from there. Before I started this blog in January 2010 I covered ebooks, ebook readers, and digital publishing for about 2 years as a part of MobileRead Forums. It's a great community, and being a member is a joy. But I thought I could make something out of how I covered the news for MobileRead, so I started this blog."

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