In the original Newsweek article on the Kindle, the author suggested that Amazon was taking a loss on many kindle-editions to maintain the low price. Since the record labels are on record as saying Apple doesn’t charge enough for iTunes songs, it might be that Amazon is operating their mp3 division at a loss, to build market share.

Amazon has another advantage here too: the many people who have bought low-price CDs from Amazon will have Amazon accounts already, so buying the mp3’s won’t involve setting up a new account. The only onerous thing about it would be downloading the special application Amazon uses to co-ordinate buying all the tunes on an ‘album’ of songs.

This is all serious snacking for book publishers to consider when thinking of ebooks. I have little doubt that publishers (who were already fretting over Amazon’s discounting policies regarding pbooks) are nervous, very nervous, over the threat that the Kindle will monopolize the ebook world the way the iPod has the portable media player world.

So going no-DRM, and cutting prices, would be levers to work back against the looming power of Amazon.

Personally, I don’t see the publishers succeeding. They have up till now demonstrated the same head-in-sand, ignore-future, rely-on-last-century’s-business model, that the record labels have. They don’t release ebook editions; when they do, they price them comparably with pbooks (hardcover pbooks) so as to preserve their bookstore sales; then they lard on DRM and only release for a few devices, and so on.

I don’t know what the answer is for publishers, but the case of recent Harry Potter books indicates that the only thing stopping widespread piracy and the utter destruction of publishers’ business models is the twin saving ‘graces’ of:

1. Americans don’t read books anymore
2. The Americans who do read books, are even more backward-looking than the publishers.

But these two anomalies cannot long endure.