Barnes & Noble claims elimination of agency pricing will increase prices

An article in the New York Times (June 8, 2012) describes the Justice department’s settlement with publishers to eliminate “agency pricing” which was claimed to enable collusion among publishers for ebook prices. Under agency pricing, five publishers were allowed by Apple to set their ebook prices and pay Apple 30%. The publishers had claimed that this prevented Amazon.com from dropping prices to uncompetitive levels for ebooks, thus stressing hardcover sales. Would elimnation of agency prices raise consumer prices because the supply chain would be less coordinated ? Does Barnes & Noble prefer agency pricing because it would decrease Amazon’s pricing competitiveness ? If the Justice department’s ruling decreases retail prices to make it uncompetitive for writers’to participate, will the supply chain be worse off ?

About aviyer2010

Professor
This entry was posted in Ecommerce, Operations Management, Service Operations, Supply Chain Issues and tagged , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s