“One defends when his strength is inadequate, he attacks when it is abundant.”—Sun Tzu, The Art of War
The Apple iPad isn’t even available yet, but already it is forcing Amazon to respond in a variety of ways to protect its competing Kindle eBook business. Amazon just snapped up a touchscreen technology startup, presumably to update the already ancient-looking Kindle. Emboldened book publishers are pushing back on Amazon’s $9.99 pricing now that they can sell the same eBooks on the iPad for $14.99, and Amazon is capitulating. And the Kindle team at Amazon, which once had an arrogant approach towards publishers when it was the only game in town, is now bending over backwards to solicit their loyalty, says one editor at a publishing company who has noticed the change in tone.
The coming battle between Apple and Amazon will occur on many fronts, but place where Apple can really hurt Amazon is on pricing. Just as Apple initially did with 99-cent songs on iTunes, Amazon imposed a uniform $9.99 price on bestsellers in the Kindle Store. A single price helps to establish markets for new product categories, especially when that price is at a discount to the physical alternative. While the 99-cent strategy worked well for Apple in digital music, in books Apple doing a jujitsu move on Amazon by allowing publishers to have more control over the pricing. Now Macmillan is demanding that Amazon sell its eBooks for $14.99, and News Corp’s Rupert Murdoch is making similar grumblings about HarperCollins.
Even before the Macmillan dustup, on the day of the iPad launch Steve Jobs predicted (in this video with the Wall Street Journal’s Walt Mossberg that Kindle and iPad “prices will be the same. . . . The publishers are actually withholding books from Amazon because they are not happy with it.” And voilà! All of Macmillan’s books disappeared from Amazon, to the great joy of Barnes & Noble. The books will be back soon at the higher price, but the pressure from other publishers to follow suit is already growing.
Simply by allowing a $14.99 price on the iPad, Steve Jobs destroyed Amazon’s $9.99 price advantage. At first glance, it might seem that Amazon will actually come out the winner here, since it was losing money on each $9.99 bestseller and now will be making money on those. For instance, it currently pays publishers 50 percent of the list price for bestsellers, which is typically $28. Thus it loses about $4 on each Kindle bestseller. Under the new agreement with Macmillan, it will pay 70 percent of the new list price of $13 to $15 and pocket about $4 on each sale. Forced to make a trade-off, book publishers prefer to make less on each digital book under the new iTunes economics and keep the list price higher in order to protect sales of physical books.
As counter-intuitive as it may seem, Amazon is actually not the winner because it just lost pricing power to the book publishers. Citi analyst Mark Mahaney explained why in a note earlier this week:
This one is counter-intuitive. Typically, people think of pricing power as the ability to raise prices. With AMZN, it’s the ability to lower prices and to compete on Price, Selection & Convenience. If Amazon is forced to do away with $9.99 pricing on all best-sellers (which typically account for 5% of book retailers’ sales), it will be less able to compete effectively with other eBook retailers.
The economics of eBooks for Amazon just changed. It was willing to take the loss on that 5 percent of sales to win customer loyalty, bring them into the Kindle Store, and buy other titles at a profit. It was a loss leader. Just like Amazon loses money on free shipping or Amazon Prime, it chose to lose money on bestsellers to gains loyalty and market share.
Mahaney estimates that Amazon will sell 3.5 million Kindles this year and 100 million eBooks. He estimates total Kindle hardware and eBook sales (assuming the $9,99 price) to come to $1.9 billion, or 5 percent of Amazon’s estimated total revenue for 2010. If Amazon can’t hold the line on the $9.99 price, it will be harder to sell 100 million eBooks and there might also be less demand for Kindles. (The ability to buy new books at a steep discount is one of the Kindle’s main appeals). Every million Kindles Amazon doesn’t sell will result in a 1 percent reduction in Amazon’s total estimated revenue for 2010. (Barclays analyst Douglas Anmuth estimates only 3 million Kindle sales this year). Will the iPad dampen sales of the Kindle and its eBooks, and by how much?
Amazon cannot afford to lose this war. Not so much because of the potential revenue impact this year, but because as digital books become more popular they will become a bigger part of Amazon’s business than of Apple’s. What we are seeing is a fight over who, if anyone, will get to be the iTunes of eBooks. Amazon holds that position today, but book publishers saw how iTunes emasculated the music industry and don’t want to repeat that experience. Perhaps nobody understands that better than Steve Jobs, which is why he is now playing a different game.
Pricing and selection are important, but so is technology/user experience right? People are always complaining about how hard it is to read on computers, and while I haven’t kept up with the specs on the iPad, I imagine it would have the same problem since it doesn’t use e-ink.
And since Amazon just revealed that it’s going touchscreen in the future (via it’s acquisition of a touchscreen startup today), it will not have e-ink either.
The e-ink religion just lost its Pope.
How many Kindles have they really sold? 3 million? 5 million? Even with the Kindle at a cheaper price point, how long before iPad users surpass Kindle users? 1 year? 1.5 years?
If the Kindle is Amazon’s bestselling device in units and revenue and Kindle book sales have surpassed real book sales (super fineprint: only counting the instances where both are available, the Kinle library is vastly smaller), when do we get real numbers as a business unit rather than continuing to say that it is the “most wishe for”?
Amazon sells books. Apple sells computer hardware. The Kindle was just a stopgap until the e-book reader market got established. The only reason Apple sold music is to sell more iPods. I see a lot of iPad users using the Kindle app on the iPad.
Except that Sony Readers and iRex iLiads already have touchscreen layers over their e-Ink screens. E-Ink and touch are not mutually exclusive.
“E-Ink and touch are not mutually exclusive.”
Might as well be. E-ink’s slow refresh rate makes any decent kind of interactive display practically impossible. That’s why the B&N Nook even went to the extreme of adding a second (LCD) screen.
For sure, Apple will not be so dumb not see that Amazon is clinging on to their e-ink, to make their e-book customers, stay. Who knows? Maybe on the 2G iPad, this glare reduction option is available already…
Ah, yes, it really does looks like the comparison has begun.. iPad under fire: http://bit.ly/apple-ipad-scrutinized-details
People who really like to read aren’t going to care about an color or video.
What does matter is readability.
If you like to read, I suggest you do the following before purchasing an Ipad.
1) Google LED eyestrain, then google Eink eyestrain.
2.) Download an ebook, try reading for a 2-3 hour stretch on your computer monitor.
#2 should give you a pretty good idea of what you are up against. I’d hate for you to have fight through headache/eyestrain when you find a book you just can’t put down.
Ebooks didn’t take off until Eink readers were developed, this isn’t a coincidence.
Eink readers are for people who like to read. I suppose the Ipad (Istrain?) will suffice for those who just want to look at the pictures.
Pretty cool quote there General Tzu.
Take this: “War doesn’t determine who is right, war determines who is left.”
Or this: Wife who put husband in doghouse soon find him in cathouse.
Or these:
Panties not best thing on earth but next to best thing on earth.
Man who stutters has a lot to say.
C-O-L-O-R
The books are read are design-focused and have color content. That is why I didn’t buy a Knidle even though I read a ton.
Grayscale doesn’t work for everyone.
Most people like to read things besides picture books and People Magazine, frequently called “literature”. For these people, color means almost nothing.
Much hubbub about nothing!
Since there is already a Kindle Iphone App, and Kindle is currently the largest e-book retailer, it us up to Apple to create a reason for customers to change. Apples iBooks app seems somewhat lame, though it will get better I’m sure.
Amazon can write an iPad app that is superior to Apples, and can work on all devices. If Apple blocks the app, they will be demolished by the media and probably the authorities. The only thing that Apple has going for it is the screen, they will have to give a real reason for consumers (most of whom have bought ebooks from the Kindle store and have already read them on their iPhones) to switch. After all, the only difference to the customer is which little icon they press.
Amazon can compete with Apple on Apple’s own device. The only way Apple wins is if they go with an open standard for their ebooks, making the reader just a front end. And that seems unlikely.
And..I as a reader, will not throw away my Kindle, like everyone predicts. I have an iPhone and will probably buy an iPad, but until they make a transreflective display, I’m not going to give myself a headache to read a book.
Once Amazon creates an Android and OSX app, users will be able to access their Kindle content no matter what device they are using…truly cross platform. Unless iBooks offers a similar solution, all of this Amazon v. Apple stuff is moot. Apple will carve out its niche with the turtleneck crowd, but I don’t think it will threaten Amazon’s core e-book business.
The competition is good for everyone. Hopefully Amazon innovates and creates an e-book reader that does more than just reads books, but maintains the simplicity and ease on the eyes.
I pretty much agree with you on the software front.
Kindle could be on every reading platform, iBooks won’t.
But if rumors is to be considered, periodicals and comics could be iBooks’ angle of entrance, the rest will be purely UX to determine the retention rate.
ePub is a good start, and I hope DRM-free ePub will be an option for the publishers & independent authors to choose from.
I think you haven’t read iPad’s spec, its gng to support ePUB for ebooks. which is the universal extension….so I anyone can transfer their ebook collection to iTunes and it will transfer it to ur iPad
Amazon cannot win this war. Here’s the reason:
They are quite used to being the bully and haven’t had to compete with a real tech company for a very very long time. Last time they did was A9 and we all know how fast Udi Manber folded from that deal. FAIL!
I think they have grown accustom to operating from a position of strength. Their culture is not ready for Apple or Google. They are set up to roll over old retailers with no tech smarts.
Bezos cannot win this fight.
Well . . . competition will probably end up benefiting the customer. Really push the innovation.
Too bad I’m not a book reader. I read blogs .. . like ahem. TechCrunch
http://www.traderbots.com/stocks/Stock.aspx?symbol=amzn
My sense is, if they are just now buying a touchscreen startup, that they have already lost the war.
Exactly.
“iTunes emasculated the music industry”
Right, because it’s iTunes that destroyed the music industry, and not free mp3s.
iTunes provided the only effective response to a music industry that ignored their market’s needs. Now the labels are stuck between Apple and other models that provide even less revenue.
Pirating continues to create issues in the market, but I believe that it is also abut providing effective access to sharing of the music experience. Labels continue to make it effectively impossible to share music. We used to have radio, and radio used to be worth listening to. That is sadly, no longer the case.
Tell us how eBooks will be different? The publishers are looking for models that consider the content but not the context. Amazon’s success will lie in sharing and communication as much as eBooks. If you cannot connect like I would at a bookstore in my neighborhood, what is the determining factor? Cost. Any market driven on cost is a dying market.
Yes, iTunes is certainly better than the alternative for the music industry (free mp3s). My only point is that it took pricing power away from them in the bargain.
Isn’t that essentially what Apple and Amazon both try to do–make disruptive business models? Because iTunes basically cannibalizes CD sales the way Amazon killed off Barnes and Noble and Borders. I think Apple will when because of CONVERGENCE–people aren’t going to want a ton of devices in their backpack. Also it seems like Apple’s next target after eBooks could be Nikon and Canon–how many people would buy an iPhone if it had a Zeiss lens with 9 Megapixels and same form factor?
will win*
And just imagine when you’re iphone will wash the dishes, do the laundry, microwave your food, vacuum your room and maybe at some point blow your …. !
Ah Apple is so great !
Apple didn’t destroy the pricing power of the music industry as much as it destroyed the music industry’s pet format, the Album/CD. The music industry had become lazy and thought that consumers would always buy 12 songs when they really only liked three songs. Plus the music industry was able to resell the same music over and over again for several decades as consumers transitioned between LPs, 8-tracks, cassettes and finally CDs. However, with CDs, a careful consumer can rip his music to a computer and keep it forever and listen to it on CD copies, iPod, iPhone, etc.
Also CD prices remain exorbitantly high. Often I can buy a DVD version of the same recording for the same price as the CD version. This makes no sense.
Oh yea, the music industry also screwed themselves by not deciding on a common high quality surround sound format (DVD Audio, SACD, HDDVD) until BluRay finally won. By then, people didn’t care. If record companies start recording HiDef BluRay discs with video, that might be enough of a jump in quality and format to make people buy physical discs again, but I doubt it.
Let’s remember a big reason why Apple won the music wars: Apple was the first company to offer the music companies a revenue stream, at a time when free .mp3’s were all the rage. Apple offered the music industry “a deal they couldn’t refuse”, that is, a way to make actual money. The widespread illegal copying of their music had completely destroyed their sales. Apple came along and offered iTunes as the ONLY way for them to make money. All the record companies jumped at the chance to have Apple ride in a the white knight. Books are a different issue. Amazon was already in place. If anything, this upwards bidding war will only end when Amazon or Apple make one bid too high, and the market decides to patronize the second best price, since it would be cheaper. The second most expensive price will win the day, and the market will flock to that provider and leave the highest price provider to flounder. A completely different situation to what was the situation in music when Apple rode in on their white horse…
Great article. Apple certainly has a leg up since they are melding all forms of content (music, video, text) through one platform (iTunes+iBook+apps).
http://tropicalgringo.com/Jipn
These are all irrelevant issues as to which device will emerge the premier e-reader or become the “iTunes of eBooks”. If we’re talking about reading books, then what matter is the reading experience (not have 5M unrelated apps or tapping on a screen like an infant). That boils down to Kindle’s eInk experience versus iPad’s backlit LED screen. The former is the closest digital equivalent to a real book while Apple’s display reminds us why people don’t read books on their monitor. The tech press has been remarkably off the mark in how it compares the Kindle and iPad from the standpoint of the quality that matters most: the reading experience.
I just dim the brightness on my iPhone when i’m reading something.
e-ink = not a big deal
Dimmed brightness LED != e-ink. It is a big deal, if you’re any kind of serious reader. In the long run, the eye strain difference is huge, as is overall readability of material and speed of reading.
Amazon apparently doesn’t think e-ink is a big deal either — after harping on that for years, they’ve gone out and bought a touchscreen startup… They’re gonna be building aPads (amazon) in the future, not e-ink black-n-white Kindles that look like 20 year old PCs.
I kinda like it. Gives it a “retro” feel that is easy to read. I look at computer screens all day and looking at eink is much easier on the eyes.
don’t lie to me romero!
Well, most people haven’t even seen the quality of the iPad screen, it’s better than most laptop screens.
I realize that some people have a problem staring at the computer screen but many of us do it for more than 8 hours a day without any problem whatsoever.
I think part of the eye fatigue problem is that there are some really crappy laptop screens out there and people aren’t very careful on the lighting conditions when they look at their laptop screen. I also think there’s a psychological aspect related to looking color LCD screens, that is, LCD screen => similar to work environment => feels like work => do not like.
I agree completely. I think people just have to wait for the iPad to actually be released, try it out for a few months, and then realize that it isn’t in fact the “Kindle Killer” that some seem to predict it will be.
I’m speaking only about the usability experience here, like you. I can read for hours and hours at a time on a Kindle — but ask anyone who works in an office all day staring at a computer screen and they’ll tell you exactly how much of an eye-strain that is.
I’ve tried reading books on my computer — with that Kindle PC application — and I just can’t do it. Well, not for any prolonged period. Perhaps it is due to already wearing glasses, not sure. My eyes are just much more comfortable reading off paper or eInk screens (and I’ve owned a Sony Reader as well, so I’m not necessarily talking about a Kindle when I say that).
regardless its a proven fact that e-ink is better for your eyes, and all you have to do is search the apple forums of people complaining about the eye strain caused by mac book pros. http://discussions.apple.com/thread.jspa?threadID=1677617&tstart=0
its like saying, yeah you can eat a huge steak every night , and you might not clog your arteries.. in the same case why put more strain on your eyes in the first place.. just to own a cool iPad.
I bought a kindle 2 weeks ago. One of the primary reasons for doing so was the price of books. Most of what I’ve bought has been below $7. I can’t see spending $15 on something I can’t resell, trade or lend out. It has to be proven that people are willing to spend $15 on an eBook. I think this will backfire as people will not be willing to spend $15 on eBooks.
Music is a different story. Music is something you listen to over and over again, but a book is something that you may read once and then move onto something else.
Amazon could really do well i think if they kept with there base ideas on the kindle but revamped the design with an e-ink touch screen that maybe supported color. None of this, does everything crap, make it a media reader, books, magazines, blogs etc and price point it lower than the ipad. Im glad that amazon is forced to consider redesign of the kindle cause it was pretty fugly…
Amazon will find other ways to entice users to stick with them on the pricing front. Just like they do with video games. It’s called store credit. And it sounds like they’ll have $5 per title to play around with. Not to mention, Kindle for iPad will allow you to have the best of both worlds. E-ink Kindle and the same books on the iPad when you don’t feel like carrying both around. Also…no one knows exactly how well iPad is going to sell and then how many of those sales translate to book sales. Remember, it’s primarily being touted as a media center device, not a reader.
Funny thing: ophthalmologists tell us that there’s effectively no difference between reading from paper or from a lit screen, provided your room is properly backlit. (In fact, they recommend visually-impaired folks read from screens because they’re actually less straining in some ways than paper.)
I have a lot less eyestrain from my iPod Touch than I did from the Sony PRS-700 whose touch-sensitive layer gave it major glare problems.
People who actually give it a shot may discover reading from the iPad isn’t so bad after all.
Kindle doesn’t have any glare at all. I definitely prefer it over an LCD screen. Plus it’s lighter than iPad (talking 6″ here, I think the DX is dead man walking). Makes it easier to read for long periods of time, while exercising, etc.
Nevertheless, Amazon the Company will come out of this just fine. Even if they stopped making the kindle tomorrow I could still buy e-books from them and put them on the iPad with their Kindle App.
3 letters = DIM
Dirty in Man?
thanks for trying to prove your argument with a blog spam/post that you wrote. seems like a credible source /sarcasm.
There’s been little word from Amazon since that strange, buried post on the Kindle forums this weekend, and Macmillan books still aren’t available for sale except by third parties. I think it’s a bit early to say definitively that they’re capitulating, though many news outlets keep reporting it as if it’s already happened.
Also, to imply that Macmillan is withholding it’s books from Amazon is a bit twisty. Amazon made that decision, not them.
Here’s one thing I’m confused about: are you sure that Amazon pays publishers 50% of the print bestseller price for eBooks or they pay 50% of the eBook price? If Macmillan sets it’s price at $15 and Amazon sells it for $10, they still have to pay $7.50, yes? So they keep $2.50. If Macmillan sets the price at $10, Amazon sells it at $10, then Amazon keeps $5, they don’t lose. If the price goes up to $15, Amazon keeps $7.50.
When the split changes to 70% to the publisher, Amazon gets $4.50 if a book sells for $15 and publishers get $10.5, so how will publishers make less on each digital book?
Bah, this is the same crap the Music Labels already went through. I think Apple set back the industry by several years with their ebook store by raising the price of each book. We were finally getting close to forcing the same thing to happen with books that happened with music(DRM-free all around and at lower prices) and then Apple stepped in and trashed all that, giving the power back to the publishers. It’ll likely still move that way anyway(everything will), but now it’ll just take longer.
I would say that one issue would be e-book price relative to hard-copy price. It would be interesting to see the demand curve for e-books as average price moves from 9.99 to 14.99.
Also – why wouldn’t Amazon consider taking their loss on the hardware end and lowering the price of the Kindle? As the price disparity grows between a Kindle and an iPad – it increases the likelihood that someone would own both – and dedicate their reading to the Kindle side.
E-Books aren’t even worth $5 let alone $10. Over valuing your digital product will only encourage piracy.
Consumers will set the price of ebooks. Apple can try to sell ebooks for prices higher than Amazon charges – and then consumers will buy fewer of them. Sooner rather than later, ebook prices are headed down, because publishers will come to realize that, like it or not, to sell them in volume, they’ll need to cut prices drastically.
Completely agreed. Seems like the publishers want both the lower production costs of e-books and a higher than normal (so far) margin.
In the end the consumer loses.
I’m agree with you and Andy. No one see that we lose with higher prices.
Thanks Apple, you announced the iPad a week ago, and haven’t even entered the market yet, but you’ve already jacked up the price of eBooks. It’s bad enough that you gouge your customers, but why should the rest of us have to suffer?
Sorry folks, if I’m going to make a lifestyle transition from my paper materials to a digital reader, e.g. newspapers, magazines, books, textbooks, notepads, periodicals, comic books – I’m just going to buy and just carry around one device.
iPad is going to dominate.
Pricing: It’ll be slow at first, but once 2nd, 3rd generations come out and when the price drops for the first generations (e.g. iPhone 3G can be bought for $99, refurbished for $49 – down from $199-$299 less than two years ago), unless Kindle drops prices drastically, there won’t be much pricing difference that outweighs the benefit of an e-ink reader to the general public.
Apps
Just give it time and the big companies + software developers will release some truly amazing apps, making use of the larger screen. Kindle has their “app store” but can’t imagine something too exciting with a black and white screen.
It’s inevitable – Apple will win out on this.
I want to know the percentage of Amazon’s total sales depend on books and eBooks nowadays before subscribing to the “war Amazon can’t afford to lose” theory.
Of course, a revamped Kindle would probably be a multimedia device — music, video, etc. — that would make Amazon’s existing services all the more enticing.
Interesting times!
But that means Kindle would be competing in a space that Apple already has 10+ years (even more if you count general computing) of experience, esp. with iPod + iPhone. It’s an uphill battle.
One argument is for Kindle to just stay put where it’s at and just compete in the e-ink reader, etc market and own that. But with the recent purchase of multi-touch company and their app store, they’re obviously trying to expand…which won’t work cause it takes years to perfect the user experience through software…ask Microsoft.
As far as I’m concerned Amazon should just port the Kindle app to the iPad and be done with it.
Getting into the electronics business might have been necessary to kick-start things, but they’re never going to be able to compete there.
Port the Kindle app, get the Stanza guys involved so the Kindle app is way better than the rather bare-bones iBooks app, and then get down to selling ebooks.
Lots and lots of ebooks.
Jeff Bezos looked at Apple’s margins and got blinded by the glare of all those numbers to the left of the decimal point. So he decided Amazon was going to become a hardware player. That is a pipe dream. There is no way that Amazon can compete against Apple in the hardware department. They had a nice run with the ungainly, utilitarian Kindle. It was a nice concept demo for a new product category. Now the big boys have taken a look and decided to get in on the action. It’s time for Amazon to run for the hills. Stick to their knitting. Instead of wasting their resources tilting against the Apple windmill, they should be working to develop the best eBook app on all mobile devices out there. Apple cannot stop them. The feds will be on Apple’s tail one second after they block the Amazon eBook app.
Ditto. As I said above, port the Kindle app to the iPad, and get the Stanza guys involved so the Kindle app is way better than the rather bare-bones iBooks app.
Apple will never allow all of the user-friendly font and page customization tweaks that’s second nature to the Stanza application.
Next, make it easy for ANYONE to publish a book through the Kindle ecosystem and make money.
Amazon needs to focus on becoming the “app store” of the ebook world.
This comment is just wrong.
Amazon is by far the 95% dominant player in the e-ink e-reader industry. And ipad’s backlit LCD will simply not even change any of that. Nobody will ever read a book using a backlit LCD.
I’ll take a “we’ll see” on that…
One year after the iPad goes on sale, let’s revisit this idea with 12 months of data behind us.
I read books on my iPhone all the time, and when I last checked, it had a backlit LCD.
Stop buying into the e-ink marketing materials…
“Nobody will ever read a book using a backlit LCD.”
Considering how many people use Stanza on the iPhone (hint, lots), this is factually incorrect.
I myself have been using Stanza and my iPhone to read in the neighborhood of 175-200 novels over the last two years.
Once you reverse to white on black, adjust font size with a pinch, and tweak the brightness with a swipe up or down… it’s perfectly comfortable to read in any situation, even bright sunlight. I read with it every day.
I personally don’t care for the e-ink screens because of the very poor contrast ratio. It’s not black on white, it’s dark grey on lighter grey. It doesn’t work well for me.
Reading on the iPad: light text on dark background or pleasing color schemes like sepia.
Multi-purpose devices are going to dominate dedicated ebook readers.
But not the IPad. It will have a certain level of success, but not for long, IMO.
Full tablet PCs that can actually play Flash and accept USB memory sticks are going to overrun the IPad. Readers will be able to read their ebooks with Barnes & Noble’s reader software or Kindle for PC.
If Amazon can get onboard with PC/tablet manufacturers, who would dearly love to destroy Apple, Amazon is going to be just fine.
Is Google going to launch a “virtual” library, where I can borrow books (including new ones and best-sellers) for a week or two against a monthly (or annual) fee ? I always here they scan millions of books.
This would really “emasculate” the book industry
And btw, what is going to happen with our beautiful and useful libraries when Apple and Amazon will sell 90% of the books and most of them in numerical format ?
I think some other point is important here. Apple is more adapted to new, frenzy economy where nobody knows what will happen to their business a year from now or so. Apple is simply opening his own blue oceans (uncrowded business spaces with scarce competition) and is counting on Probability Law. Some of those businesses will fail, but some will be stars (like iPhone and iTunes). I think Jobs actually really doesn’t care which of them will suceed, he simply made calculated risk, similar to those of Venture capital firms when making investments.
On the other, riskier side of business are companies like Amazon that are specialized for some niche (in this case book selling). As someone mentioned here correctly, Amazon cannot afford to fail at his core business. Unlike Apple, Amazon doesn’t create its own uncrowded blue oceans, but is swimming in his only, red (overcrowded, full of sharks/competitors) ocean.
It puts Amazon at quite big disadvantage, and is making Bezos et all nervous. Best advice for Amazon would be to adapt new business tactics which would transform Amazon into lean, swift (some call it Protean) Company which would change shape as new market opportunities emerge. That is exactly what Apple is doing now.
It doesn’t need to re-invent whole company. It would suffice to establish R&D arm which would act like independent Company described above.
Ebooks is by far the best digital reading experience imo but in the long wrong it might now matter. I feel people these days are reading books less than before (thanks to more distractions like the web) and in the long run people aren’t going to want to own a kindle if an ipad/ipad like device is priced about the same and does so much more.
People are reading again thanks to the Kindle.
Nobody will read any books on the ipad.
Again, “we’ll see”…
Two things: iPad’s LCD vs. Kindle E-Ink is, at best, a straw-man issue. iPad is a general multi-purpose device with a great screen; Kindle a single dedicated one with matte-paper-like feeling but an annoying pageturn flicker. iPad will win this one, comma period. Kindle has never been anything but stopgap solution for Amazon anyway, which is in content-selling, not hardware-making business.
Second: you are all forgetting (or, more properly, never seem to question) that the $10-15 e-book pricing model is not sustainable in the long run, not even in the short run. All it’ll take to crumble is a critical mass of iPads –and iPad-lookylikes with aped content-access models– that’ll be attractive enough for publishers, first smaller, then major ones, to experiment with other content/ distribution schemes. The present one, in which e-books are priced on a par with hardcover- and trade paperbacks, is loopsided, and will not stand the pressure from the marketplace.
Once a major publisher realizes that hitherto-deadweight backlists and out-of-print titles can be made to pay for themselves provided they’re sold off in aggregated lots of low-low unit prices (think all Victorian Crime 1850-1918, some 200 titles that are barely read now, but of great potential interest to crime.lit afficionados [of whom there are plenty] were it to be available as a package – for, say, GB£99, i.e. effectively less than $1/a title), the process of decoupling e-book production costs from paper-borne ones will begin. Fine, bestsellers and harrypotters will still sell for $15, but other books will be priced acc. to degree of public demand. REMEMBER WHERE YOU READ IT FIRST: HERE.
Apple is actually going to get their device in the hands of every person, and then force publishers to lower the price. Either they lower it, or they’ll be at the mercy of lower sales. When you have millions of people using it for games, email, web browsing, etc., reading will just be a very natural extension, and I think we’ll see publishers eventually give into lower prices.
Disney owns Marvel.
comic books on the iPad = kick ass
The ipad is not for reading books until Apple uses a Pixel Qi screen: http://armdevices.net/2010/01/08/charbax-tests-pixel-qi-at-ces-2010/
Nobody will ever read books on backlit LCD screens, the text is just not readable confortably for hours and hours. Only for reading few emails and blog posts. Even for that, Pixel Qi is much better than regular LCD screens.
Seriously guys, stop confusing all screen technologies. E-ink is not the same as a backlit LCD.
“E-ink is not the same as a backlit LCD.”
No, e-ink is a low-contrast, low-resolution, low-refresh-rate, B&W (actually gray and gray) solution in search of a problem — any problem — to solve.
I’m not confused, e-ink sucks.
And nice link back to your personal opinion site…