Back in November 2007, when Amazon released their original Kindle e-book reader, there must have been a fair bit of internal debate as to what to price it at. The Kindle wasn’t the first e-book reader on the market (not by a long way), but neither was the market mature enough to suggest a clear price point. They could also have chosen from a number of different pricing plans which may have worked.
They could have chosen some kind of cell phone type of payment scheme where the hardware price was subsidised by regular monthly payments over a fixed contract length. Some sort of halfway house where there was a charge to download books or access the net would also have been a possibility. Amazon chose to charge the full price for the Kindle reader and to have no monthly fee – 3G connectivity was included in the $ 359 selling price. Neither was there any fee for downloading Kindle books, it was very much an all inclusive package.
The Kindle was pretty well received – Oprah Winfrey declared it to be her “new favourite gadget” – but it didn’t exactly change the world. It was considered to be something of a work in progress – which is exactly what it was. It wasn’t until the launch of the Kindle 2.0 in February of 2009 that the e-book market really exploded. The Kindle 2.0 was also sold for $ 359 and the large display Kindle DX was released in the summer of 2009 with a price tag of $ 489.
The e-book reader market took off and, for a while, it seemed as if every electronic manufacturer either had, or was developing, their own e-book reader. Companies like Sony, Barnes and Noble, Asus, Plastic Logic and a host of others jostled for position and fought for a share of the emerging market. With a 60% market share, the Kindle was the market leader by a long way and was the industry standard which other readers were measured against. Any new reader which hinted at even the slightest potential was immediately given the title of “Kindle killer” – but the fact of the matter was that there was no real credible competition for the Kindle.
However, the launch of Apple’s iPad changed the scene and, not for the first time, the death of the Kindle was widely predicted. However, and also not for the first time, rumours of the Kindle’s impending demise proved to be premature. The third generation Kindle was released in August of 2010 and sold like hot cakes. Shortly after the Kindle 3 launched Amazon were sold out of the new readers and prospective customers were faced with a four or five week wait before their new readers would ship.
In addition to all the usual good upgrades to the technical spec – more memory, faster page turns, smaller and lighter body, higher contrast screen etc. – Amazon unveiled a new entry level Wi-Fi only Kindle with a price of only $ 139. The price of the 3G plus Wi-Fi model was set at $ 189 – a big drop compared to the $ 359 price. More importantly perhaps, the new Kindles are considerably cheaper than even the entry level iPad – and there’s no monthly connection fee to pay.
It seems fairly obvious that the Kindle and the iPad can co-exist. If the same can be said for other e-book readers must be somewhat questionable. The big advantage that Amazon enjoys over some other e-book reader manufacturers is the fact that, being a book seller, it will be able to profit from the ongoing sale of e-books. It could elect to subsidise the sales of its reader hardware using the profits from e-book sales if it wished.
The e-book market is developing very quickly. It seems obvious that hardware prices have still further to fall, and very possibly in the near future. Is it possible that we could even see Amazon, and perhaps Barnes and Noble, giving e-book readers away free in order to secure future e-book sales? Is it beyond the realms of possibility that customers who sign up for Amazon’s Prime membership (premium delivery service) or take out an Amazon credit card could find themselves in receipt of a free, or heavily discounted, Kindle reader in the fairly near future? We’ll find out sooner rather than later.
Learn more about the Amazon Kindle for yourself and view the wide range of Kindle accessories available to help you personalise your reader.
