The E-Book Market Is Going To Be Huge - Will Amazon Continue To Dominate?

It's pretty clear that the Amazon Kindle is the current “must have” gadget on the market today. It seems very much as if the Kindle ebook reader is an idea whose time has come – and the Amazon Kindle is undoubtedly the best example of such a device on the market right now. It is also, and let’s make no bones about it here, cool.

The Kindle has often been compared to the Apple iPod - which now has a kindle application that permits you to read kindle books on it – by a number of industry watchers. Indeed, going back to the initial launch of the Kindle (November of 2007), Steven Levy’s article in Newsweek suggested that the Kindle was the “… iPod of reading”. Two and a half years later it seems that drawing parallels between these two devices might go some way towards understanding the current success of the Kindle – and perhaps even give some indication as to what might happen in the near future.

Amazon head honcho Jeff Bezos is quoted as saying, again back in 2007, that “This [the Kindle] isn’t a device, it’s a service.” - and that is absolutely fundamental to understanding why the Kindle works so well in Amazon’s business model.

Some criticisms have been directed towards the Kindle’s high price – the Kindle 2 currently sells at $359, slightly reduced from the original Kindle price of $399. The original iPod was priced at $399 when it was released – prices have fallen as the product was first accepted, and then passed through mainstream to practically ubiquitous. At the same time functionality has increased.

Apple is, and has been for some time now, synonymous with music downloads and has increased the available range of products to include videos, games and a host of applications for the iPod. In a very similar way, Amazon is strongly linked with books, making the Kindle the perfect choice of product for them. The recent announcement of the larger Kindle DX is noteworthy, not purely because of the various technical enhancements that it offers, but because it improves Amazon’s capability to deliver newspapers, magazines and even academic textbooks to its consumers.

It would be wrong to discount the technical aspects of the Kindle series of readers completely of course, but it seems that, for Amazon, the technology is a means to an end rather than the end itself. The fact is that, when it comes to e-book reader technology, Amazon are pretty late entrants to the market when you consider that there have been contenders such as the Franklin ebook (no longer being developed but still available from some sources) kicking around since 1999, and Sony have been selling ebook readers for some time. There are a number of others, some of which have already died a death, others are struggling on without, currently at least, attracting anything like the type of interest which the Kindle enjoys.

Another key advantage enjoyed by Amazon at this time is the 3G wireless technology used to enable Kindle users to download their ebooks in less than a minute without the use of a computer or an internet connection – and without being tied in to a monthly contract or having to pay a download fee. It’s a perfect example of the clever way that Amazon have utilised technology to provide a very real benefit for their customers.

No recurring monthly fee and no download charges means that Kindle users don't feel tied in or committed to the Amazon service, an important consideration given the relatively high price and the current economic downturn. Of course, whilst customers will be able to purchase ebooks elsewhere for use with their Kindle, it is still going to be a lot easier for them to buy from Amazon’s large, and ever expanding, selection of Kindle friendly books. Amazon are going to enjoy a lot of repeat business – in exactly the same way that Apple do with their iTunes store.

Drawing upon the iPod experience to predict the Kindle’s possible future, it seems unlikely that the Kindle will have it all its own way. As mentioned earlier, there are already a number of existing alternative ebook readers on the market – the Sony PRS is probably the best known contender aside from the Kindle at the moment, but there are others. These will either need to improve in order to competitie with the Kindle or they will simply disappear from the marketplace.

It's also worth remembering that there are a number of new readers currently in development. Plastic Logic, has a Kindle DX sized reader under development which is scheduled for release in 2010. Rumours abound concerning the release of a new Apple tablet based computer, suggested to be aimed at bridging the gap between an iPod Touch and a full blown MacBook. It would not be too fanciful to imagine that Apple might expand their iStore to include ebooks just as they expanded it to include videos after the release of the iPhone and iPod Touch.

And it’s not just stronger competition based upon improved reader technology that Amazon might have to face. In March of 2009 Google and Sony announced that Google’s enormous library of public domain e-books would be made freely available for Sony’s reader. That’s a grand total of 600,000 titles (which is increasing all the time) and is a clear signal that the lucrative ebook reader market will be fiercely contested in future.

At the moment Amazon is in a very strong position. It has a large number of ebooks in its library, it has the wireless technology to provide fee free downloads and, most important of all – the Kindle is cool. Whether or not it develops into a ubiquitous iPod type product or not in the face of what will likely be fierce competition only time will tell. Amazon have been more than smart so far, so it seems likely that they will be a major player in this emerging market for a long time to come.

One thing seems sure, we will are all going to have the option to read books, magazines, newspapers and even textbooks using portable digital readers in the near future. As competition, economies of scale and further advancements in technology combine to bring prices down this will become an increasingly popular choice for many, quite possibly even the majority of, readers. It seems that the way we read is about to change, possibly faster than you might think.