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Marketing price war

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This link, http://www.businessinsider.com/amazon-diapers-price-war-2010-11, leads to a news story about Amazon.com starting a price war with Diapers.com. It is an interesting read. Please comment on Amazon's strategy, and on any steps that Diapers.com might take to fight them off. Do you think this will be profitable for Amazon in the long run?

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The solution comments on Amazon's strategy

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Amazons strategy is to drive out the competitor using their notoriety and their ability to discount prices due to its size. Since Amazon is more popular than most of its competitors, they can afford to decrease their spread since they know they will sell more volume and thus get more ...

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