Amazon is getting serious about getting its way with ebook pricing, threatening to do what they did to Macmillan (pull physical and digital books) unless publishers agree to certain demands.
Among Amazon’s requirements is that publishers enter into a three-year deal so that no other distribution method (read: Apple) will be able to get lower pricing. This is the same thing Apple is requiring publishers do as well, so if both camps play hardball, publishers need to price books exactly the same with the exact same deals on both platforms. Publishers, since the ebook industry is so new, don’t want the three year contracts since they feel it hampers any manoeuvrability they need as the industry matures.
As background information, here’s how Apple screwed Amazon over during the iPad announcement, Amazon’s subsequent (pretty much immediate) phone calls to publishers, and Apple’s further hatred in the MP3 pricing.
The bottom line is, Amazon is threatening two major publishers (not sure who exactly), but if they’re pulling out the nuclear option, it means they are desperate, and really, really serious about this price war. [NYTimes]