In Search of Competition For Amazon's Kindle and Sony's Reader

On Saturday, the WSJ published an interesting compilation of celebrity New Year’s resolutions, with major names (Mitt Romney, Martha Stewart, Wolfgang Puck) as well as prominent people who are mostly or entirely unknown to the general public. As they described their goals

For the New Year, The Wall Street Journal asked some influential people three questions: What professional project do you plan to complete in 2009? What personal resolution do you finally hope to keep next year? And what problem should your industry or professional community tackle more effectively?

One that’s directly relevant to readers of this blog (particularly after yesterday’s posting) is this of an Indian expatriate author:

Vikram Chandra, 47
Author, Mumbai and Berkeley, Calif.

PROFESSIONAL: I just started a new novel a couple of months ago, and in a magical, perfect world I'd finish it in 2009. But my last novel came in at 900 pages, so I'll settle for slow, steady progress.
PERSONAL: I'm the father of a 7-month-old baby, so I think it's time for me to get done with my driving lessons and face the terrors of the DMV.
INDUSTRY: I'd love the publishing industry the world over to accept fully and without further complaint that electronic publishing is here to stay, and to provide innovative, sophisticated and, above all, low-priced competition for the Kindle and Sony Reader.

His sense of realism about the future of dead trees is refreshing. His call for open standards (because that’s the only way the Amazon (AMZN) and Sony (SNE) products will get competition) is the first I’ve seen from the content side, although such calls have been common from the consumer side.

Of course, there are two open e-book standards already, .epub and .opf, which are available to the maker of any reader. What’s missing is a content publisher building an infrastructure around distributing a large volume of content in an open file format.

Yes, it seems likely that the next entrant into online ebooks will emphasize open standards. As I noted in a chapter I wrote on open standards (in a 2006 book) on open standards, openness is almost always a challenger strategy — not something firms do if they have a choice, but a weapon they use to gain leverage and increase the odds of success over established (proprietary) incumbents.

On ebooks, publishers probably don’t want Amazon exclusively controlling their channel to American readers, so perhaps (as record labels did for music downloads) they will support a challenger to Amazon.

So to compete with Apple’s (AAPL) iTunes and the lockin provided by its proprietary FairPlay DRM, the iTunes challenger promised in May 2007:

Every song and album in (our) digital music store will be available exclusively in the MP3 format without digital rights management (DRM) software. (Our) DRM-free MP3s will free customers to play their music on virtually any of their personal devices -- including PCs, Macs(TM), iPods(TM), Zunes(TM), Zens(TM) -- and to burn songs to CDs for personal use.

Sounds good? I think so. We could use the same choice for books as well, particularly since there’s only one Amazon reader to date (at least Apple has four different iPod form factors).

How would Amazon feel about this sort of competition? One might argue it should be all in favor of it — since the press release touting open MP3 downloads was to promote the Amazon music store.

But, of course, now that they have a lead and lock-in built upon their market power and proprietary file format, for books (unlike music) Amazon probably considers open standards a bad thing.

Disclosure: None

Comments

[2speed:]

I agree with your point, and I will buy a new Kindle when they are available for under $100. In the meantime, I will continue to use my HP iPAQ 210, with adequate 4” screen to read e-books that I buy directly from Mobipocket.

So currently there is some competition to the Kindle and Sony in the form of PDAs. (And of course you can use your PC.) PDA devices are expensive but they have many other capabilities that help justify the price. Smart phones can be used as well, although their small screens are difficult to read, especially for people my age.

But content for the PDA or PC is more affordable than that available on Amazon. I’m not sure about content for the Sony, but with their history I expect the price is high.

Formats such as Microsoft, Acrobat and Mobipocket are available. I’m not familiar with the open source formats you mentioned, but I will check them out.

Right now, I prefer Mobipocket. They have an extensive, reasonably priced, library. I also read (public domain) classics free from Project Gutenberg, which I convert to the Mobipocket format using Mobipocket’s free utility.

2008 Dec 28 09:49 AM

[Roger Knights:]

I doubt that any large publisher would forgo copy protection --at least on books that are in print. They don't want to release unprotected books and get into the situation the music industry did when it provided unprotected CDs. If publishers weren't worried about piracy, a few of them would have sold their books in an unprotected format long ago, to vendors of the half-dozen or so readers out there. It's not Amazon that is the problem, from their point of view, but the solution.

2008 Dec 28 04:40 PM

[Roger Knights:]

PS: If there's any competition coming, it'll be from Google, in the wake of its agreement with the publishing industry to pay a license fee on the online out-of-print books it makes available. The could be the precursor to an agreement to resell in-print books. But those, I expect, will have to be copy-protected. Else why didn't publishers, or some publishers, agree additionally to let Google offer unprotected in-print books too?

(I probably have a few details wrong about what Google's agreement involved.)

2008 Dec 28 04:45 PM

[Tom876:]

I live in Asia and am read avidly. The makers of ebook readers consistently limit their market to the US and Canada. I've been trying to buy one for years. This is nuts. Anyone in the US or Canada can buy a bushel of books from the Goodwill or Boarders, or check them out from their library. Why would they buy a $300 toy? Why not sell to the huge expat market crying out for one? Also, the sellers of ebooks charge too much (which matters little to a market that largely doesn't exist because there are few devices to download them to). This seem to be a failure of marketing common sense.

Thanks! Tom

2008 Dec 29 10:49 AM

[herb lipton:]

Hello those who wish to make a fortune. Where are you?
The overpriced Kindle that has controls that cause problems, is a big opening for hundreds of thousands of readers that will make a $100,00 investment( like myself).
There must be marketing problem?

Herb

Jan 24 03:13 PM