From the New York Times: “If readers come to believe that the value of a new book is $10, publishing as we know it is over,” said David Gernert, Mr. Grisham’s literary agent. “If you can buy Stephen King’s new novel or John Grisham’s ‘Ford County’ for $10, why would you buy a brilliant first novel for $25? I think we underestimate the effect to which extremely discounted best sellers take the consumer’s attention away from emerging writers.”
Amazon is already sticking $9.99 in consumers' mind with their e-books. I've seen numerous Amazon posters give a book a single star because they thought the ebook was overpriced since it was more than $9.99. Except, A. Authors don't set their prices and B. Amazon is selling their ebooks as loss leaders to get people to buy Kindles.
Read more about this discouraging trend here.