Amazon furious after publishers undercut its book prices online

An online price war between Amazon and some of the UK's largest publishers is expected. Penguin, Bloomsbury and other publishers are discounting books on their websites encouraging customers to buy direct from the publisher rather than use an online retailer. For example Bloomsbury offer a 25% discount and free post and packing for orders over £20. This has angered Amazon who may retaliate by paying publishers less. Amazon's contract with publishers stipulates an agreed discount to the recommended retail price (RRP). However Amazon may choose to define the RRP according to the publishers online discount price rather than the full price. This according to publishers is unfair, which could ultimately increase prices for consumers.

Amazon also faces increased competition from high street booksellers such as Borders and Waterstones, who are increasing their online presence.

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