Prices weren't lower because of Amazon's leverage over publishers. They were lower because Amazon was willing to lose money to build a platform and a market. Re

Prices weren't lower because of Amazon's leverage over publishers. They were lower because Amazon was willing to lose money to build a platform and a market. Remember, pre-agency publishers made more money along two dimensions: 1. Wholesale prices were often higher than their share of an agency price. 2. Since the prices to end-users were lower sales were higher than they otherwise would have been. And don't forget, publishers had a much simpler, pro-competitive response if they were afraid of Amazon's dominance: drop the DRM. Then they could have sold ebooks to all of Amazon's customers (including Kindle device owners) without Amazon.