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I was surprised by the following:

The Guild voices some valid concerns, including the fear that publishers might try to prominently position loss leader books in the lending library in order to drive sales of other authors — but this sort of activity is already prohibited by existing clauses and is more an issue between publisher and author than anything that involves Amazon.

Why is such strategy (using a loss leader to sell other stuff) prohibited? What is the rationale?

this is good for overall volume, but if you're the author of the loss leader, you may get significantly less revenue

Ok. That makes sense... I was thinking about supermarkets/grocery stores when I originally asked the question, as they do this all the time. The situation is different when there's an author who'll complain.

More precisely, when Amazon sells a loss leader, they don't pay the author wholesale price. When a grocery sells milk cheap, they still pay full price to the dairy vendor.

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