The interest of authors is very clear: sell as many books as possible. They are paid a meagre sum per book (a dollar, maybe?) so they really don't care about the price other than that it is as low as possible to stimulate sales, but they have no control over pricing regardless.
Hachette, meanwhile, needs to keep prices up since any reduction would come directly from their margin, given that they pay authors a very low and fixed sum.
Amazon of course, as any other distributor, wants to get better conditions from Hachette and naturally uses its customer base to put weight behind what they are asking for. When the deal failed, they presumably had to continue buying books under, to them, unacceptable conditions, so they did two things to consolidate their losses:
1) slash discounts from Hachette books 2) buy less Hachette books
I'm not including the recommendations for other books, because if you have used Amazon at all in the last 10 years, this is just how their website functions regardless if the product at hand is a book from Hachette or a sponge.
If you want to blame someone here, blame Hachette or the relationship between traditional publishers and authors. As I've pointed out above, the interests of the two parties are not well aligned at all. Maybe it is true that Amazon pushes for deals hard to swallow for publishers, but if they are paying authors a dollar on a $10 book sale, that is hard to believe. If their overhead is that large, capitalism demands they are put out of business, and this time it is just Amazon picking up the slack, when it could have been any distributor.
