Ebook Monopolies How Likely Are They?

1829 Words8 Pages
EBook Monopolies: How Likely Are They?
As demand for technology increases, many companies have begun to transfer every day items and tasks to an electronic version of the same program. A specific type of product that has been altered to be more compatible with growing technological demand is books. Before technology was popular, books were available as paperback and hardback copies only. However, as consumer demand for technology increases, tablets are becoming an asset to a person’s work materials. To accommodate for this shift in consumer wants, eBooks are created; these make up for the technological improvement and produce a cheaper alternative to actual books. The possibility of an eBook monopoly is steadily increasing and is already high
…show more content…
According to Boundless, “… (T)he optimal decision for all firms is to equate the marginal cost and marginal revenue of production” (Boundless.com). Monopolies are focused on maximizing profit price and output. This can be done by graphing the marginal revenue, demand curves, and marginal cost of the firm, identifying where marginal revenue and marginal cost curves intersect, determining the output level at that point, and using the demand curve to find the price charged at this output level. Essentially, monopolistic firms are focused on maximizing price and output like competitive firms, however, they are able to change market price based on their production levels unlike competitive firms. Electronic publication monopolies will mainly focus on the highest price they can charge a customer for an eBook, the smallest price they can pay the publishers for the books without getting in trouble, and how many eBooks the company can produce in order to make the most money off of them.
If Amazon becomes an eBook monopoly, the price of eBooks would steadily increase. This is because this approach is the approach Amazon was taking before Apple tried to stop them with the publisher-distributor contract. As Amazon puts companies out of business and competition goes away, the price per eBook will increase so Amazon can make the most money for the production of the product. In the end, publishers would not be paid a considerable amount for providing their books and customers would be charged too much for each eBook they

More about Ebook Monopolies How Likely Are They?

Get Access