The blogosphere is abuzz with the news that Amazon (s AMZN) is cutting the price of the Kindle by $40, to $259. Being an early adopter, I paid $399 for the device, which most of the time sits gathering dust, but is a constant companion when I am traveling, both locally and internationally. Sure, Amazon has brought down the price, but I still think the device is too expensive and needs to be cut by another $100, to $150, in order to make the reader truly affordable and mainstream.
Maybe that will happen sooner than later. Amazon says it’s going to start selling the device internationally and this new version will be able to download books in 100 countries. Some analysts have estimated that there will be about 6 million Kindles in the hands of consumers, and with these new international devices, that number could go up sharply, giving Amazon the scale it needs and thereby allowing it to bring down the price.
Forrester Research today increased its forecast for e-reader sales in the U.S. to 3 million units, up from a previous forecast of 2 million -– with 900,000 of them seen selling during the holiday season. “Lower prices, more content, better distribution, and lots of media hype are contributing to faster-than-expected adoption of eReader devices in 2009,” Forrester analyst Sarah Rotman Epps writes in the new report.
“We expect sales to double in 2010, bringing cumulative sales of eReaders to 10 million by year-end 2010,” she continues. “If the category expands beyond E Ink-based displays in a substantial way, 2010 sales can easily surpass this projection.” Forrester estimates that Amazon will account for 60 percent of the e-reader market share, followed by Sony (s sne), with 35 percent, while other device makers like Foxit, Interead and IREX will account for approximately 5 percent of U.S. e-reader sales.
The new international version of the device is going to use AT&T’s (s T) 3G network, which utilizes the more popular GSM-based technologies. So far, Sprint (s S) has been the connectivity provider to Amazon’s WhisperNet and the company will continue to use Sprint for its U.S.-only edition of Kindle. There is a battle brewing between the carriers when it comes to providing communications for machine-to-machine networks. (Related Post: Amazon Kindles Good for Telcos, Bad for ARPU.)
I bet Amazon is going to see a big bump in the number of books downloaded over Kindle as a result of this global edition. Amazon CEO Jeff Bezos tells the New York Times that when both physical and digital copies of book became available, Kindle took in 48 percent of total book sales vs. 35 percent last May. “This has grown much faster than any of us ever anticipated,” Bezos told the Times. Amazon, it seems, is Netflixing (s nflx) its rival, Barnes & Noble (s bks). (Related reports from GigaOM Pro: Evolution of the e-Book Market & How Barnes & Noble Can Avoid Getting Netflixed.)
When I was in New York recently, I met with many large media houses, and they have all embraced the Kindle. In fact, e-books/e-readers are being viewed as a panacea for the beleaguered publishing business. As more content becomes available, the utility of e-readers is only going to increase. But as we have said in the past, standalone e-readers are a bridge to newfangled, all-purpose Internet devices that will do everything.
I can wait and give my mom one of those new super devices. Or I can bring her a Kindle the next time I go to see her in New Delhi!