Cader: Discounting Could Cost Amazon 65% of 2011 Profits
From Publishers Lunch (What the Settlement Might Actually Cost Amazon and Barnes & Noble):
If Amazon has a market share of 55 percent among the biggest publishers, they are entitled to lose another $113 million selling ebooks over the next year. If Barnes & Noble’s share is 27 percent, if they choose to fully compete on discounts, it would cost them only about $30.5 million. For investors concerned about Amazon’s diminishing margins–$177 million in net income for the last fiscal year–that extra discount comprises roughly 65 percent of last year’s profit.
Read more at Publishers Lunch.
