I’ve just found out, thanks to fellow blogger and FriendFeed Maxine, that the UK office of fair trading is to "investigate" the agency model publishers are using to force Amazon and other book/ebook sellers to charge what the publisher says and not what the retailer (amazon and co) want.
“The Office of Fair Trading (OFT) has announced that it will be conducting an investigation into anticompetitive behaviour by firms with regards to the use of the ‘agency model’ by publishers in relation to the sale of e-books.
Following a number of complaints. the OFT would be looking into whether “arrangements that certain publishers have put into place for the sale of e-books may breach competition rules.”
The investigation will be under the Competition Act 1998 which prohibits agreements, practices and conduct that may have a damaging effect on competition in the UK.
Essentially the agency model means that publishers are able to dictate the prices of ebook products, with firms such as HarperCollins and Penguin able to determine how much consumers pay for their ebooks rather than the vendor, by which the pricing is typically determined having purchased from the publisher.
Does overpricing encourage piracy? Look at DVDs and music, once overpriced and now worthless.”