Food For Thought – Guest Blog by Alexis Bonari

Will Competition from iPad and Tablet PC’s Drive Kindle to Go Free?

Certainly we are on the verge of a tablet PC revolution, and it’s already threatening the bustling Kindle market. New screen technologies that bridge the gap between E-paper and LCD displays, along with the inherent multi-functionality of these devices threaten to dethrone the Kindle as current king of e-readers. Amazon’s recent announcement of a discounted Kindle model, although with advertisements splashing the home page, is a direct response to the tablet PC market. We’ve seen this kind of trend before, both in conventional publications and on the internet, so is this a good move on Amazon’s part, or evidence of a dying market?

Ad revenues drive a lot of the publishing world, both online and in print. A major difference between an embedded device like Kindle and these other markets is that people are used to seeing advertisements on web pages and in magazines. They are not however, used to seeing advertisements in books. I can already see the shocked looks on peoples’ faces as they are presented with Viagra ads while reading a romance novel. Well, it’ll probably never get that out of hand, but still, you’re already paying for the book, whose really going to want advertisements to come with it? Of course they aren’t taking it quite that far yet, but the small amount of advertising they are doing also reflects in the price savings, a mere $25.

Considering the hard sell of advertisements, we might see Kindle take another route, the loss leader. Like printers and video game consoles we might see reductions in price in the Kindle hardware to the point where they’re actually losing money selling it, and then make up for it with a rise in the price of the e-books. There is a flaw in this strategy as well, Amazon currently dominates the e-book market, but that might not be the case for long if they increase the cost of their e-books.

More likely than not Amazon will utilize a combination of these two strategies, since going overboard with either one will likely hurt their business. Another mistake a lot of people seem to be making is underestimating why people by a Kindle to begin with. E-books are hardly a new concept, and there are plenty of public domain books you can even download to your computer for free, so why are people willing to dish out money for these? Because they’re simple to use and convenient.

They’re meant to cater to a relatively less technical crowd that doesn’t want the hassle of dealing with a laptop or other multifunction system. Reading through criticisms of Kindle, I constantly run across people denouncing it for its lack of features, such as availability of apps, multiple fonts, etc. I doubt we’ll see Amazon take this direction in Kindle’s development for 2 reasons, because adding complexity to the device will distance it from its core demographic, and second because they want to make it cheaper, not more expensive.

So is Amazon ready to start handing out these babies for free? I don’t think so. They might hand them out for free to certain customers, but I don’t see it happening en masse. More likely what we’ll see are incremental reductions in price along with more advertisements and higher prices on e-books. Likely, most of the back catalogue of e-books will remain unchanged, with the newest best sellers coming up just a tad. Although the iPads will take away some of Kindle’s business, it will be the technologically savvy early adaptation crowd that they grab, and not the people solely interested in convenience and ease of use. I think the Kindle has a lot of life left in it, and not only will it continue to dominate the e-reader market, but it won’t go for free either.

Alexis Bonari is a freelance writer and researcher for College Scholarships, where recently she’s been researching graphics design scholarships as well as gymnastic scholarships. Whenever she gets some free time, she enjoys watching a funny movie or curling up with a good book.