01 July 1999

THE WORLD’S BIGGEST online bookstore,, picked-up the electronic gauntlet thrown down by WHSmithOnline and slashed 50% from the prices of its forty best-selling UK titles. Arch-rival [Bertelsmann] declared its intention to follow suit. The price war was sparked by W H Smith, whose internet bookstore discounted its top twenty hardback titles by 50%. Surprisingly, Amazon UK managing director Simon Murdoch insists that his company’s response is part of a ‘long term pricing strategy’ rather than a retaliatory move. Amazon’s strategy here mirrors that of its US parent, which in May introduced price cuts of a similar level [suggesting that W H Smith’s move was a pre-emptive spoiling tactic in the UK market]. If the price war escalates from cyberspace into the high street it could signal the begin-ning of the end for many small booksellers.