Opinion: Amazon To Drop Kindle 3 Price At $99 By Holidays

July 29, 2010

The new Kindle will reach mass market status at the magical $99 price point

As Amazon plans to release a cheaper Kindle next month, the smaller, lighter, faster, brighter e-reader will actually reach “mass market” status when its price drops below $100, instead of $139 today (Wi-Fi only).

“That’s the magic price point for consumers,” confirms Netgear CEO Patrick Lo. “Our retail experience shows that consumers are more willing to buy 2 products at $99 than one at $199.”

So my advice to you is that, if you’re not in a hurry to jump in the e-reader bandwagon of course, to simply wait until mid-December, to buy the Kindle 3 at a $40 discount.

That will also give you the time to evaluate other options, such as smartphones and more complete Tablet PCs – like the Apple iPad – that will lets you read e-books, browse the Web, check e-mails and much more.

But at $99, there’s hardly any reason not to treat yourself with one for Christmas!


Apple iPad To Disrupt eReader, Netbook Markets

January 27, 2010

Apple's iPad is a nice PC tablet that outperforms current high-end eReaders at a lower price

Despite all the buzz prior to its unveiling earlier today during Steve Jobs’ keynote (you can watch it here), the iPad is anything but magical or revolutionary as Apple CEO wants us to believe.

Consider the iPad as a big iPod touch or an iPod touch XL or DX (in honour to the large sized Kindle).

Super thin, unbelievably light, reasonably priced

First, the good news. The iPad is really thin (half an inch), super light (1.5 lb) and has a 10-hours battery life and 1-month standby; a great achievement for a device that thin.

At CES, a couple weeks ago, Nvidia showed  a Tegra-powered tablet with 16-hours HD video playback time or  140 hours of audio playback, surpassing the iPad. Note that these numbers were for  tablet prototypes and might be better or worse on the final product.

Starting at $499, the iPad looks cheap compared to the similarly sized Amazon Kindle DX, which sells for $10 more: the iPad has a full colour screen, can browse the Web, read ebooks (with the iBooks app and the ePub format) and run applications (games, maps, social networking…).

All these things that the Kindle just can’t do. But to be fair, we’d have to compare the Amazon device with the 3G data-only connection (and Wi-Fi) iPad version, which then costs a whopping $630, without the optional data plan – but included with the Kindle.

The optional Bluetooth keyboard dock transforms the iPad into an "interesting" netbook

No Flash, camera, USB port and extended storage

Now the bad news.

As its smaller siblings, the iPad still doesn’t support Flash, which makes it a poor device to browse the Web, even compared to other ARM-based tablets – running Linux or Google Chrome OS for example – which offer support for Adobe’s Web video technology.

More surprising is the lack of an integrated camera. Not sure why this design choice, especially as the iPhone has one; making me think that the iPad is really just a souped-up iPod touch.

The lack of a USB port and an extended storage (e.g. an SD card slot) are two additional unpleasant surprises. However, Apple does sell a dongle to copy photos from a camera through a USB connector or an SD card slot.

The iPad is a killer eReader

All in all, the iPad is anything but magical or revolutionary. But I can see it be a cheap Mac (although it can’t run MacOS apps), an Apple version of a netbook, with its optional keyboard.

“Netbooks aren’t better at anything! They’re slow, they have low quality displays and run clunky old PC software. They’re not better than a laptop in anything. They’re just cheaper. They’re just cheap laptops,” Jobs joked.

Moreover, the iPad relatively lower price could very well disrupt the whole eReader market, that is currently inundated with over-priced devices like the Kindle or the $400 Sony Daily Edition. And I’m not sure the sleek Skiff e-reader stands a chance now.


Churchill Club Top Trend: Electronic Displays Will Not Be A Hot Hardware Investment

May 21, 2009

Q&A With Ian Freed, Amazon Kindle Chief On Color, Touchscreen, Web Browsing And More

May 8, 2009
Ian Freed is Amazons vice president in charge of the Kindle e-book reader

Ian Freed is Amazon's vice president in charge of the Kindle e-book reader

I had a conversation this morning with Ian Freed, Amazon’s VP and general manager for the Kindle e-book reader.

In the 20-minutes or so we had, we covered a lot of grounds, including why he doesn’t think touchscreen and color is ready for prime-time on the Kindle.

Here’s an edited excerpt of our conversation:

What does DX stand for?
It stands for deluxe because it includes a larger screen, more capacity, plus the ability to read documents in their original form (8.5 by 11) or A4 document.

Why did Amazon raise prices on certain e-books?
That’s actually not a correct assumption. We always had variable pricing with e-books since the day we introduced Kindle. So there’s always been a range. We have made a commitment for the New York Times best sellers to be $9.99. But if you look in the catalog, pricing is in different ranges for all kind of different books. And just like in physical bookstores, prices move around a little bit.

Any plans to add touchscreen capabilities to the Kindle?
We thought about touchscreen. Our goal though is to create the best reading experience as possible. But what we’ve seen so far is whenever there was a touchscreen implementation with electronic ink and electronic paper, it degraded the reading experience, because you’re introducing more reflections, more sets of glass between the electronic ink and the customer.

What about color?
When you think about it, most books are actually just fine in black and white. That said, there are a lot of applications like magazines that will look better in color. But if we introduce color that wasn’t “rich color”, I’m not such customers will like it. And so we far we haven’t seen the combination of the grey electronic ink, the electronic paper and rich color. We’ve seen color in labs but it’s just not that rich experience that you expect from color.

Will the Kindle ever be good enough to browse the Web?
When we introduced the Kindle in 2007, we wanted to include a Web browser primarily for being able to read text-focused web sites, like Wikipedia or search results. The nature of electronic paper is great for text-focused content. We’re not attempting with Kindle to build a browser that is great for all kind of websites. It’s great fortext-focused web sites.

Why buy Lexcycle?
We think we’re in the extremely early days in the evolution of digital books. The Lexcycle team were a set of great innovators, really passionate about e-books. And they built some great applications and we went them to join Amazon as part of the team. Our plan is to keep that business run separately – as we often do at Amazon – and that they will innovate in their own ways, separate and distinct from Kindle but with the support of Amazon.

Amazon launched a large screen version of its Kindle, targeting primarly at newspapers and textbooks readers

Amazon launched a large screen version of its e-book reader - the Kindle DX - targeted primarly at readers of newspapers and textbooks

Any plans to open up the Kindle format?
The Kindle format was designed to work seamlessly with Kindle devices and other devices, but to do things customers we think will really like. So for example, with our feature WhisperSync, I can open up a book on my Kindle and start reading it, and later on, open up the same book on my iPhone and it will sync automatically at the same place that I was on, on my Kindle. Same thing for the annotation feature: you can annotate on your Kindle and see the annotations on your Kindle for iPhone application. So our perspective is if you’re focusing on making things really simple for customers, you may need to do things with the format that are specific to those devices and those applications.

Will the Kindle format remain proprietary then?
I think it’s an open question (sic!). We plan to keep innovating on behalf of customers and that innovation may take various form in the future. So it’s hard to speculate about what we might do there. But we have a wide open platform- the digital text platform - for content providers that are free to publish directly in the Kindle format themselves. In that way it is a very open platform.

Why add support for PDF in the Kindle DX?
The main reason is that we heard from many customers that the amount of reading that you do that is outside of books, periodicals and blogs is generally in the form of personal or professional documents that are typically on 8.5″x11″ sheet of paper; and a lot of it is in PDF format. So instead of carrying hundreds of pages of those documents, we wanted you to move it easily to your Kindle and be able to read them. But it’s the combination of having a large screen and the need to maintain the structure of the document – with no re-flows – that really let us to support PDFs.

Will the Kindle really be the savior for newspapers?
It think people have been concerned about newspapers for a number of reasons. Our goal is to provide a great reading experience for customers, in some cases that with newspapers, magazines, highly formatted books and professional documents (PDF). Newspapers have been available on Kindle since we launched on November 2007 and customers love it. Kindle newspaper subscriptions are among the best sellers on Kindle.

This week, the CEO of the Dallas Morning News said Amazon takes a 70 percent commission on newspaper subscriptions through the Kindle. That seems really high, isn’t it?
I don’t want to speculate on what somebody said, and I’ll leave it at that.

When Kindle be available outside the U.S.?
We’re absolutely looking forward serving our international customers with Kindle devices. But just like with the original Kindle, that took us 3 1/2 years before we introduced it, we are focus to create a great experience before launching the Kindle internationally; there’s just a lot of things to work on before that happens.


The $359 Kindle 2 Costs Amazon $186 To Build

April 22, 2009

Nice markup, ehh?

According to a product tear down by iSuppli, Amazon’s new Kindle 2 has a 48 percent gross profit on its material and manufacturing costs.

The Kindles E Ink display module costs $60, or 42% of the total

The Kindle's E Ink display module costs $60, or 42% of the total

The popular ebook is constructed from parts costing $176.83, and its manufacturing and battery add another $8.66, bringing the total to $185.49.

Not included are costs for intellectual property, licensing fees – and, of course, sales efforts, marketing, shipping, etc.

The markup still is attractive given the normally slim margin retails operate with.

About $60 of the material costs go to E Ink for the display module at the heart of the product. The display uses an electrophoretic bistable technology that allows it to show an image even when it’s not drawing power, said Andrew Rassweiler, principal analyst at iSuppli.

The next most expensive component is the wireless broadband module from Novatel Wireless at $39.50. Qualcomm supplies a baseband processor priced at $13.18.


With Jobs On The Sidelines, Apple Has Something To Prove

April 7, 2009

The Apple rumor mill has been strangely silence.

Of course there is some chatter. Pundits expect two new iPhones by midyear, one, a cheaper model with less storage and the other perhaps an upscale version with a video camera. Snow Leopard, the next version of the Macintosh operating system OS X, will almost certainly be the focus of the June developers’ conference in San Francisco.

Jobs probably still has his fingerprints on new products, but where are they?

Jobs probably still has his fingerprints on new products, but where are they?

And new iPods should hit the ground in August, when the line is normally refreshed, with the iPod Touch perhaps getting a camera.

But what about the bigger questions? How will Apple capitalize on the rapidly expanding netbook market? How will the company respond to Amazon’s Kindle? And what is its next step into the digital living room?

With CEO Steve Jobs at home recuperating, Apple needs to show it is firing on all cylinders, as the Wall Street analysts love to say. Apple insists Jobs is playing a role. But the company needs to show it can find the next category killer, or creator, at a time when its leader is not 100 percent.

Tom Bajarin, the president of Creative Strategies, says Job’s fingerprints are likely on any product in the pipeline – now and for at least the next two to three years.

“Remember, they started work on the iPhone in 2004 and it did not come to market until 2007,” says Bajarin. “So his influence is still far reaching and could extend for many years, even if he is not involved full time.”

Any yet the rumor mill has dug up no solid report of a netbook, or mobile device that would change the current thinking about mobile computing.

Bajarin reasons that Apple may not enter the netbook market with a low-cost product that cannibalizes their laptop sales. “That is why I think that if they do respond to the netbook threat, it could be in some type of form factor that is very different than what we have now,” he says.

We are waiting. And we are anxious to see what product perfectionist Jobs and his crew unveil.


Amazon Releases Free Kindle App For iPhone

March 4, 2009
The Amazon Kindle comes to the iPhone... free!

The Amazon Kindle comes to the iPhone... for free!

Amazon released today a free ebook reader application for the iPhone and iPod touch.

The Kindle for iPhone can download and read any books released for the Kindle.

The free app includes Amazon’s Whispersync technology which allows to seamlessly switch back and forth between an actual Kindle and the iPhone while keeping your bookmarks and the reading location where you stopped at.

The Kindle App can not access the Kindle Store!

However, there is currently no way to buy and browse new ebooks from within the application. Instead, you’ll have to go to the Amazon Kindle Store with the iPhone web browser, buy a book, which then shows up on the iPhone.

Amazon confirmed that it will support other devices in the future, probably Google’s Android phones, as well as most of the large screen smartphones.

Although the Kindle app cannibalizes the sale of the $359 Kindle 2 ebook reader, Amazon hopes it will help boost the sale of ebooks to compensate the loss.

The Kindle app release may also signal the beginning of the end for the many publishers that have developed an ebook reader application for the iPhone like eReader or Stanza.


Amazon Whispersync + iPhone: A Kindle Killer?

February 10, 2009
Stanza transforms the iPhone/iPod touch into an Amazon Kindle-like e-book reader

Stanza transforms the iPhone/iPod touch into an Amazon Kindle-like e-book reader

When it launched the Kindle 2 yesterday, Amazon upgraded its wireless technology, Whispersync, to automatically sync the original Kindle with the latest device, making for a smooth transition to the new e-book reader.

Amazon also said that with the new Whispersync, Kindle 2 could sync with a “range of mobile devices in the future”, leaving the door open to some kind of Kindle application for other hardware platforms, such as PCs, Macs or smartphones.

So Kindle on an iPhone or iPod touch? Maybe. But you don’t have to hold your breathe until Amazon decides to open up the Kindle book format and its store for Apple devices.

For example, Oregon-based startup Lexcycle released its free iPhone/iPod touch e-book application, Stanza, which was downloaded more than 1.1 million times. Stanza is still limited to DRM-free e-books which are mostly not the contemporary book titles.

But that might change soon as publishers become uneasy with Amazon’s e-book monopoly and increasingly unfavourable terms.


Why Slimmer Kindle 2 Will Flop

February 10, 2009
Can Amazon's Kindle 2 sell in a recession?

Can Amazon's Kindle 2 sell in a recession?

As widely anticipated, Amazon launched the second iteration of its electronic book reader.

The general feeling is that in spite of the thinner design, the Kindle 2‘s $359 sticker shock is simply too high of a price, especially in these recessionary times when retail spending is falling like a rock (at least 30% to 40%).

Among the Kindle 2 features:

  1. A new controversial Text-to-Speech feature that can read every book, blog, magazine, and newspaper out loud. Book publishers likened this feature as an audiobook which requires a separate license. But I think there are wrong as text-to-speech is a standard feature in operating systems like MacOS or Windows;
  2. Built-inOxford American Dictionary with 250,000 word definitions
  3. More memory (but still just 2GB) that holds over 1,500 books, compared with 200 with the original Kindle;
  4. 25% longer battery life and 20% faster page turns.

Despite already selling more than 500,000 Kindles and the huge Kindle Store, that holds more than 230,000 books, plus newspapers, magazines and blogs, I just can’t see – unlike Citi analyst Mark Mahaney – how Amazon’s latest Kindle will fly off the e-shelves, Oprah or not!


Analyst: Amazon Kindle Could Hit $1.2 Billion In 2010

February 4, 2009

Citigroup analyst Mark Mahaney thinks the Kindle is outpacing Apple’s iPod early sales.

As Amazon prepares to roll out on Monday the next-generation of its electronic book reader, Mahaney estimates that the Seattle company sold 500,000 Kindles last year for a total revenue – including both the devices and the books – of $158 million; and that sales could reach $1.2 billion by 2010.

However, to keep up with this rapid pace, Amazon will have to significantly lower the $359 sticker price of the current Kindle as it faces accrued competition from Sony’s Reader Digital Book and other low cost e-book readers, as well as various iPhone applications.


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