Agency pricing (so-called because the publisher sets the retail price and the retailer acts as an agent of the publisher, taking a fixed percentage of that as his profit) removes the ability of retailers to compete on price.
Does it? The retailer can still compete by lowering his profit percentage (30% is ridiculously high anyway and 50% for books over $10 is daylight robbery) of the final sales price. He can also negotiate a lower publisher price based on volume sold (just like traditional retailers). Amazon's $10 and lower price only for digital books is stupid, fascist and evil.
it's hard to see why you should pay $12.99 or $14.99 for the latest Stephen King or James Patterson from Apple when you could get exactly the same thing for $9.99 or less from Amazon.
That $9.99 is due to amazon's de facto monopoly, bullying publishers and authors. Amazon takes a whopping 65% cut for ebooks priced over $10 and only around 30% for books below $10. Distributors and retailers are mere channels between producer/manufacturer and users. They should have no right to set the base selling price of any item they sell, instead they should just add a markup percentage to whatever is their purchase price. We don't want another Apple appstore type pricing where everything is priced $1 to $2, because the quality of end product will really suffer.