I think it's the same idea as what happened with the online music market. Initially, it was a niche market that reached a turning point when Napster hit the sce

I think it's the same idea as what happened with the online music market. Initially, it was a niche market that reached a turning point when Napster hit the scene and started offering music online for free. At that point, publishers started taking action and we saw the rise of digital music stores and the complete marginalization/destruction of the previous market with low prices/easy access. In other words, Amazon had a niche market that few people competed in. Hence, price ended up being artificially low (same as the online music market in the 90s). Once people realized they could turn it into another distribution channel, competitors exploded and the price of the good adjusted to a more normalized market value. In economics, a monopoly can go one of two ways. It can either push prices to an extreme high in order to maximize profit, or it can push prices to a low in order to lock competitors out of the market and incentive the purchase of other goods (Kindles in Amazon's case). Once the monopoly broke, the price of the good normalized--which for us means it increased.