When Apple first announced the iPad, there were some people who stated that the iPad spelled the death of the Amazon Kindle and other dedicated eBook devices. It is more than a year later and Amazon, Barnes and Noble, and Kobo are still selling dedicated eBook devices. Amazon is selling a ton of Kindles, and Barnes and Noble has been the surprise, gaining recognition for selling sophisticated devices at reasonable prices.
According to MSNBC, the Apple iPad is being viewed as an underachiever by the book publishing industry. Estimates are Apple’s iBookstore has about 10 percent of the eBook market, while Amazon is believed to have as much as 65 percent, with Barnes and Noble taking the remainder.
Frankly, I am not too terribly surprised to see Amazon and Barnes and Noble successfully selling eBook devices because they have one huge advantage over Apple, price. I doubt that we will ever see Apple sell an iPad in the $140 price range of the Kindle and Nook. Amazon and Barnes and Noble are also not just relying on price to keep them competitive as both companies have innovated to provide more than just eBook reading devices.
The Nook Color has become attractive to the Android hacker community because of the ease at which they can root the device and turn it into a full-featured Android tablet that costs only $249. Just this week Barnes and Noble announced a new version of the original Nook that now has an E Ink touch screen that makes it easier to annotate books, while keeping the price low at $139.
Amazon is selling an advertisement-subsized version of the Kindle for $114, ironically taking a page from Google’s playbook by turning to advertising for revenue. Ads are not the only Google strategy that Amazon has employed as their MP3 Music Store, Android AppStore, and Cloud Drive offerings are only available on Android and have been well received by users. Amazon’s success at building an ecosystem around Android has lead to anticipation that Amazon will be selling Android tablets, which will put it in full competition with Apple.
It may be a surprise that book stores are presenting a bigger risk to Apple than traditional technology companies like Motorola and RIM, but it shouldn’t be. In the end Apple has evolved into a consumer electronics company and both Amazon and Barnes and Noble have always been consumer retailers.