Umm...competitors? [Citation Needed]

What I remember is that Amazon created the e-book space, for all intents and purposes.

And the reason they undercut the royalty price was to create that market. People didn't want to spend $20 or more to buy an electronic copy of a book they could buy for less in physical form. People aren't stupid: If they aren't getting a physical item they can then hand to their friends and/or sell, then what they're getting has less value.

Heck, I still get annoyed by crazy-high eBook prices. An eBook should absolutely ALWAYS cost less than the physical copy. If there are 500 copies available used for $0.01 on Amazon, then it shouldn't be more than about $5 (paying a bit for the convenience of having a digital copy -- those $0.01 copies typically add ~$4 in shipping costs), and yet you can find $8-10 price on a Kindle edition. [1]

Amazon has a very strong customer focus. [2] That results in lower prices. It also makes it harder for competition, yes, but that "customer obsession" has become core to the culture at Amazon.

[1] First one I found: http://www.amazon.com/Against-All-Enemies-Tom-Clancy-ebook/d... -- it turns out many of the $.01 books are only $6 on Kindle, which is better than I thought, but it wasn't hard to find one greater than $8.

[2] See the first "leadership principle" on this page: http://www.amazon.com/Values-Careers-Homepage/b?ie=UTF8&node...

What? Dickens wrote every word of his own stuff. And walked something like 20 miles a day, too -- often all the way out of London and all the way back. There was no "fiction factory" about him, just prodigious genius, and a whole lot of the best English ever written.

Adams is talking about stuff like this (chosen at random): http://www.amazon.com/Against-All-Enemies-Tom-Clancy/dp/0399.... Note the critical little "with" on the cover.

Dickens' success as a bestseller proves Adams' point, not yours. If you want an example of yours, pick Stratemeyer.