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Why the Kindle is doing well—at least for now: Cowan analyst’s reasons
August 10, 2009 | 1:27 pm
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By David Rothman
Yes, the Kindle could lose in the long run if Jeff Bezos sticks with his DRM and eBabel and can’t use subsidized e-book discounts to drive out his biggest competitors.
But for now, the K machine is finding eager buyers. Mark LaPedus has done a good job of pinpointing the reasons for EE Times—via his quote of Jim Friedland, an analyst at Cowan and company:
”We believe that Amazon will continue to dominate the e-reader market because: (1) the company benefits from low customer acquisition costs by promoting the Kindle on the homepages of its 50-55 million active U.S. customers; (2) Amazon offers more titles, as well as newspaper and magazine subscriptions, which are not offered by Sony or Barnes & Noble; (3) Amazon enables users to download books wirelessly via the Sprint 3G network (Sony does not provide a wireless connection; Barnes & Noble is not launching a wireless-enabled device until next year); and (4) Amazon offers more extensive product-related content, including user/editorial reviews,” he added.
(Via KindleToday.)
Update by PB: However this report by Forrester Research is not quite so positive. Sarah Rotman Epps says:
… the types of consumers likely to buy an eReader are changing. While early adopters of eReaders were a perfect storm of demographics for Amazon (they could afford the device, they have a need for the device in business travel and urban commuting, they like technology, and they buy lots of books online), future prospects for the devices look completely different. They’re more likely to be female, less tech optimistic, and they read a lot (on average, 5 books per month) but they buy and borrow books from multiple sources, as opposed to buying lots of books online.
The big takeaway is that this could spell trouble for Amazon, if competitors can move in to better serve the later waves of adopters who don’t have as strong a relationship with the eCommerce giant.
I’ve heard from clients that they’re already seeing this shift–more women buying the devices and shopping for eBooks. Looking forward to continuing the discussion…
Related: Why the Kindle 2 is a useless plastic slab for me—and many others with disabilities, by Robert Kingett, a visually impaired high school student in Florida.
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Comments:
Yeah, and Oprah. She instantly sells millions of anything she shows on her program.
A final point that can be added is simply this: it isn’t just computer platform independent in the typical definition (able to run on Macs, PCs, and LINUX); it is computer platform independent in that it doesn’t need one. This point cannot be overstated. It isn’t a computer peripheral; it is a stand-alone reading appliance.
This allows Amazon to reach more of the market than just the computer-savvy. It reaches older generation readers who are self-proclaimed “computer illiterate” but could benefit from the Kindle’s flexible fonts and large type. It reaches people on-the-go who just want their morning paper or magazine delivered even when they are on the road. It reaches far more than just those early adopters who are willing to put up with clumsy synching and PC-dependencies demanded by Sony.
Amazon has made the Kindle experience so simple that anybody that can master the “Shop the Kindle Store” on the device can use it. With all its drawbacks (price, DRM, product life, etc.) the Kindle still provides the best experience for the mainstream, non-technical public, and those who just want to read. Put simply: my mom could use it. That one fact opens the Kindle market to a far greater audience than its competitors.
I agree with B Scott. One of the hallmarks of the Kindle from the very beginning lay in reports from the first buyers, who said it was so easy and even addictive to buy books on the K. D/L a sample, like it? click a button and within a minute you have bought a book.
Another advantage, I’d say, might lie in how easy it is for small-potatoes publishers and even authors, to publish on the K. This has an effect like the iPhone App Store, but it cuts both ways: self-published works on the Kindle threaten to drown out the big names with a rising tide of low-priced crap.
I still give Amazon the edge for at least 2 more years. It’s early, sure, but it looks to me as though this is a game for Amazon to lose; nobody else is likely to take it away from Amazon barring only one event: if all the monopoly big New York publisher/media companies boycotted the Kindle in favor of other devices and platforms, and if Amazon refused to play ball with them and tried to assert dominance the way Apple did with the music labels and NBC for video.
I think the publishers and Amazon leaders are too grown-up to let things reach that stage, though.
How does Kindle recharge? I have to plug my Cybook into my computer to recharge. I can buy a wall recharger, but it’s an additional item. Is it the same for Kindle?
B. Scott is dead on accurate. The Kindle makes it easy for anyone to use right out of the box, sans any sort of computer savvy.
Christine, the Kindle includes a cord that can connect to your computer for charging and/or downloading. It also includes an adapter that allows you to plug it into a standard wall outlet for charging.
The first Kindle needed to be plugged into an AC charger.
The second and third Kindles could be charged via a USB port or an AC outlet.
Thanks. I never did realize that you really don’t need a computer at all to use Kindle. That is a nice feature. I can see the attraction for people who don’t mind buying all their reading material from amazon.com.
While in theory I could take my Cybook on a week long trip, I can’t imagine doing it without a laptop and expecting it to work the whole time. Not only do I need to charge it (because it stops working anywhere similar to well after 20% of the battery is used), although I can buy a wall charger and thereby get around that problem, but it frequently requires fixing through the computer. For example, just today I had to delete and readd my dictionary because for no reason at all it started rebooting every time I tried to look up a word. The thing is buggy like that. What I don’t know is how that compares to other e-ink readers out there.
The reason I like the Kindle so much is that it doesn’t require a computer at all. You can get your material from Amazon, or you can use the built-in browser and download free stuff from Feedbooks, MobileRead, Gutenberg, Manybooks, etc. It can be charged through a computer, but it comes with a really small wall charger that takes up no room at all in a carrying case.
I have never had a single problem with my Kindle 1 or Kindle 2.