Amazon vs. Macmillan: the e-book revolution

I heard on NPR this morning that because of the release of the iPad (a stupid name in my humble opinion that brings images of electronic maxipad to mind), Amazon is now fighting with Macmillan, a big publisher, about e-book prices. Up until the iPad, the Amazon Kindle had a pretty good monopoly over the e-book business, and Amazon chose to set the prices of all e-books at $9.99, which is way less than some books run, especially hardcovers. Publishers like Macmillan haven't been able to do much about it so far, but Apple's policy is to let the publishers set their own prices, so now Macmillan is also demanding that Amazon let them pick their own prices as well. After initially refusing to agree to those terms, Amazon removed all Macmillan-published books from their site, but that only caused buyers to go through third parties, so eventually they caved into Macmillan's demands and will allow the publishers to set the prices.

This presents an interesting example of the way that the internet and electronic media can complicate IPR-related situations, such as who has the right to set the prices when the publisher sells an electronic version of a book to be distributed to a distributer like Amazon or Apple? It seems that once the publisher's sold the rights to distribute, that the distributer then has the right to choose how much to sell the product for. On the other hand, the reason why Macmillan was so upset is because selling all books at $9.99 obviously discourages some people from going out and buying a hardback copy for three times that price. Is it right to undersell the publisher? On the third hand, if I had one, having an electronic version of a book isn't necessarily as valuable as buying the actual book, especially since the distributer has the right to remove the purchased book from your Kindle/iPad at any time, so in a sense you're only renting an e-book. Some food for thought.