It seems as though ever since Amazon first started selling the Kindle there has been speculation about how the company might come up with ways to make the device affordable if not free. One idea that I heard is that Amazon would create a monthly book club were you commit to buying a certain number of books per month, which subsidized a discount on the Kindle. Another idea is that Amazon would provide free, or heavily discounted, Kindles to Amazon Prime subscribers. It appears that Amazon has decided to try advertising as a means for lowering the price of a kindle.

Amazon has announced a new version of the Kindle that costs $114, which is $25 cheaper than the WiFi version of the Kindle. The new version will display ads, or what Amazon is calling “special offers,” in specific parts of the UI. Amazon says that it will not be embedding ads within books. Amazon will also be pushing special offers directly to the Kindle, like offers on Amazon gift cards.

My reaction when I heard this news is that the $25 discount would not be enough to get me to pick it over the current $139 ad-free version of the Kindle. I have grown so frustrated by the intrusion of advertising in almost everything that I would gladly pay $25 not have to ever deal with it on my eReader. However, I understand the thought behind this discounted Kindle. I suspect it is born from observing that people will not pay $.99 for an Android app without ads over a free version of the app with ads. I am one of those people who buys apps, but I know that I am in the minority.

It will be interesting to see how many of the ad-supported Kindles Amazon will sell, particularly given that they have already sold so many for $139. I expect this is an experiment by Amazon to see how well they do, which could lead to more generous advertising rates for them and deeper discounts down the road.