Amazon uses position of power
Amazon is the largest book seller in the United States and that gives it a strong negotiating position which it uses to obtain low purchase prices. These prices are in turn reflected in low consumer prices. According to Amazon’s philosophy, e-books can cost no more than 9.99 dollars, but Hachette found that too low and wanted 14.99 dollars.
The dispute led to the removal of a series of Hachette books on Amazon. Delivery times for other Hachette books increased considerably and/or the books lost their pre-order options. All these measures resulted in a sales slump.
A new commercial deal has restored Amazon-Hachette relations. The latter can now set the prices of its own books on Amazon, with incentives to go cheaper. The sales commission Amazon would get has not been publicly divulged.
