On Tue, Mar 30, 2010 at 7:21 AM, aki
<aki275@googlemail.com> wrote:
By RACHEL METZ, AP Technology Writer Rachel Metz, Ap Technology Writer
– Mon Mar 29, 4:00 pm ET
SAN FRANCISCO – Amazon.com, which has dominated the young but
fast-growing electronic book market for the past few years with the
Kindle, could get its biggest threat Saturday, when Apple releases its
iPad multimedia tablet. The Kindle starts at $259 and is designed
mainly for reading text on a gray-and-black screen. The iPad starts at
$499, but with the higher price comes more functions: a color touch
screen for downloading books from Apple's new iBookstore, surfing the
Web, playing videos and games and more.
It will take time to determine whether the iPad causes a tremor in the
e-reader market, a high-magnitude quake or something in between. But
in the meantime people who read electronic books or are considering
buying a reading device will find their choices getting more
complicated. If the Kindle e-reader falls out of favor with people
drawn to Apple's offering, there could be a very thick silver lining
for Amazon: It sells e-books that can be read on many kinds of
devices, including the iPad and other Apple gadgets. That means the
Kindle could fade and Amazon could still occupy a profitable perch in
e-books. However, Apple could find ways to tilt the field in its
favor. At least for now, both the Apple iBookstore and the Kindle
service will be accessible in much the same way on the iPad — as
"application" icons that users can click. Eventually Apple could give
its own bookstore and reading program more attention on the iPad.
Apple also could try to curry favor with publishers in a way that
matters to consumers, perhaps by securing exclusive titles.
Publishers' relationships with Amazon have been strained by Amazon's
insistence on charging $9.99 for some popular e-books. Publishers have
complained that it is an attempt to get consumers used to
unsustainably low prices. Amazon takes a loss on some books at that
price, and the publishers fear that if the $9.99 tag sticks, Amazon
will force publishers to lower their wholesale prices, cutting into
their profits. The iPad gives publishers an opportunity for a new
pricing model. Some e-books will cost up to $14.99 initially, and
Apple is insisting that publishers can't sell books at a lower price
through a competitor. The iBookstore is launching with titles from
major publishers such as Penguin, Simon & Schuster, HarperCollins,
Hachette Book Group and Macmillan. One big publisher, Random House,
has not yet struck a deal with Apple.
Amazon declined to comment on the iPad's release. Although Amazon has
tried to snag as much of the e-book market as possible since launching
the Kindle in 2007, the company has never revealed how many Kindles it
has sold. Analysts estimate it has sold 3 million. (Analysts believe
Apple could sell that many iPads in the product's first year). Amazon
has offered only sketches of the Kindle's effect on its business, such
as by saying that when books are sold in both hard copy and the Kindle
format, it sells 48 Kindle books for every 100 hard copies. Compared
to the Kindle, the iPad would seem to have some disadvantages. The
entry-level model is nearly twice the price of the Kindle, yet it
can't download books everywhere. It can do that only where it is
connected to the Internet over Wi-Fi. At 1 1/2 pounds, it is more than
twice as heavy as a Kindle. And its battery lasts for just 10 hours,
compared with up to a week on a Kindle when it has its wireless access
on.
However, among the elements in the iPad's favor is a touch screen that
is 9.7 inches diagonally, compared with 6 inches on the Kindle. Ron
Skinner, 70, who lives in Las Vegas and bought a Kindle last February,
says he has ordered Apple's product because he thinks it will offer a
better reading experience. Skinner, an Apple investor who reads about
three books a week, says the contrast between the text and the
background is too low on the Kindle's "e-ink" screen, and reading on
it bothers his eyes. The difference between the Kindle screen and the
iPad screen "is like daylight and dark," Skinner says.
Tim Bajarin, an analyst with Creative Strategies Inc., says the iPad
signals the start of a larger shift away from static digital versions
of books and magazines. Eventually e-books will be expected to have
multimedia dimensions, with video and interactive elements, he says,
which calls for something more like Apple's tablet device than
something that is largely dedicated to reading. The main question then
would be whether Amazon wants to try to soup up the Kindle to be more
like a tablet, or whether it will remain content to offer something
more specialized. Consider that the Kindle also can surf the Web, but
it's not a feature that's highlighted or encouraged much.
Amazon stock has risen about 11 percent since Apple unveiled the iPad
in January, while Apple shares have climbed 13 percent. But it's
possible that investors haven't seen many risks yet for Amazon because
it's not yet clear how people will see the iPad. People might not want
it as an alternative to the Kindle and a laptop, says James McQuivey,
a Forrester analyst. Instead, he says, they might see the iPad mainly
as a big iPod, leaving room for other kinds of devices. And the hype
surrounding the iPad may help Kindle sales with consumers who want a
less expensive digital reading experience. "The iPad will bring all
kinds of consumer benefits that the Kindle can't even pretend to
attempt," McQuivey says, "but at the same time the Kindle solves a
very focused consumer need in a way the iPad can't do well."
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