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E-book price war "absurd"

The e-book pricing war sparked by the launch of Amazon’s UK Kindle e-book store, which has seen the retailer price some bestselling books at less than £3, has been branded “absolutely absurd” by a top publisher.

Concerns have been raised that the UK market could be set for a battle over the headline price of e-books similar to that waged in the US over the past year. However, other publishers claimed the low prices would not affect the future pricing model of e-books.

Amazon.co.uk launched its Kindle e-book store two weeks ago, promising to offer the lowest prices on the market. In response, W H Smith dropped the price of its top 100 fiction e-books to a third of their original level, and then said that it would sell all e-books at a 50% discount.

Amazon has consistently priced some of the bestselling titles in the market at less than £3, leading to publishers and rival retailers accusing it of selling the titles as loss leaders. Stieg Larsson’s Millennium trilogy is among those available at less than £3. Iain Miller, marketing and digital publishing manager at Larsson’s publisher Quercus, declined to comment on Amazon’s pricing tactics.

However, another senior publisher attacked the pricing strategies of W H Smith and Amazon. He said: “It’s absolutely absurd to devalue our product but I’m not surprised because our industry is populated by nincompoops.”
He said Amazon’s move could make the agency model less attractive to publishers. He said: “In this instance, on the wholesale model, publishers are fine because it is retailers taking the pain. If we say a book is £10 and you get 40% discount, we get £6. If the retailer chooses to sell it for £2, we’re still all right.”

A review of e-book prices undertaken by The Bookseller shows that Amazon and WHS are offering the lowest prices. Kindle and WHS e-books are also significantly cheaper than their counterparts on Apple’s iBookstore, where prices are set by the publisher.

Before the Sony Reader launch in 2008, publishers argued that the value of e-books needed to be at parity with the print edition. Some publishers contacted this week claimed Amazon’s move would not lead to expectations of low e-books prices. One said: “It’s a minuscule market and early doors for e-books in the UK. There’s no way the stable door has closed in terms of the size of the business in 10 years’ time.”

Source: http://www.thebookseller.com/
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