Thursday, December 6, 2007

Is Kindle going to kindle your reading?

Ever since Amazon released their Kindle reader I have been wondering why Amazon went into the hardware business. Amazon's core is their service offering, be it their online merchant services or cloud computing/storage services, and this move into hardware is a pretty far adjacency to the core. Move into far adjacencies (in this case, hardware) is always fraught with risks, especially when you don't have Jonathan Ive on your design team.

First of all, Kindle is not a replacement to a computer or a PDA or a web connected phone. One should realize that neither is the opposite true. Kindle is conceived to be purely a physical book replacement.

There are two parts to what Amazon has released:
- EVDO service to dole out the eBooks
- Kindle, the reader

In the first case, Amazon is trying to provide a direct wireless service to download books directly to the reader. No need to download to a computer and then transfer it into the reader. This is an excellent move from a services POV.

In the second case, Amazon has failed to produce a reader that is sexy and attractive to a sophisticated book lover. It has produced a reader with a lot of room for improvement.

The book market is $24 Billion a year in the US alone. This includes all categories of books. The eBook market $54 Mil annual and growing. This is a good market to be in, and Amazon has made a good move.

eBooks initially failed in the market because they were too early in their intro. Akin to Newton for PDAs. Newton failed mainly because the market was not ready for its acceptance, and the interface sucked. Its form factor sucked, and Apple learned a great lesson from this failure. Newton's hand writing recognition was flawed, but the main reason for its failure was the market timing. The same is true for the eBooks.

Until now.

Amazon is trying to copy Apple's model of creating their own mp3 players and selling them for a premium. Unfortunately, this only works if your hardware has the oomph to command a good market. Like this blogger, I also feel that opening up Kindle to be a platform and letting other developers come up with hardware will give Amazon the best bet in succeeding in peddling their eBooks.

DRM and activation requirements can kill the eBook. Books bought on Amazon cannot be read on other readers, and vice versa. Why not make it similar to a physical book. A physical book can be loaned to a friend. Why not do the same with an eBook. As long as there is only one copy floating around, there shouldn't be any problem. As soon as the book is transferred to my friend's reader, I can no longer read it on mine. Come up with a handshake transaction mechanism to move the book around. Make it simple for people to do with eBooks whatever they are used to doing with a physical book. And, remember, the best marketing for a book is to be read. If no one reads your book, it doesn't get sold.

One thing that Amazon needs to consider is the cost of the eBooks. They need to choose a pricepoint that will spur the eBook sales. I don't have any data on how many they have sold after the introduction of Kindle. But, I have a feeling that $9.99 is not a sweet spot for eBooks.

They could also look into the advertising model when it comes to periodicals and blogs. The time commitment for a book is huge compared to a blog posting or an article in a periodical. So, the Ad model might work when it comes to blogs and periodicals. I would never (directly) pay to read a blog.

Another point to consider is the service's longevity as this author points out. What if I plunked $400 on a Kindle, and the service shuts down in a few years? This hits upon the price point of the reader itself. Introduce an inexpensive reader, and once the service takes a good foot hold, introduce better models with more features, AND charge boo-koo bucks for it. Prove yourself first, and then milk the market.

Some things that would make an eBook successful can be learnt from the successes of the iPod:
- Interface - simplistic interface with minimal buttons that just did its job: Dole out music.
- Design - Need great industrial design
- Brand marketing
- Integration and connectivity of the player, computer, software (This has been solved with the EVDO delivery)
- Windows support (No need of platform support)
- iTunes store (Amazon store)
- Form factor
- And last but not the least is Accessories - Sleeves, jackets, the most expensive ones are cars!

Something that the Kindle could benefit from is style. And, a water tight case.

Some of the benefits of eBooks/Kindle are:
- A great boon for independent freelance writers. Akin to music and blogs, everyone of us could write a book and publish it!
- No worry about the book spine and closing books.
- You can also upload your documents to the reader to read them.
- They are green. They do not waste paper or other natural resources.
- Convert any book to large print automatically.
- Take up space of one book, but can hold thousands.
- Random access and searchability.
- eInk technology is cool and makes a great reading device.

Will be really cool if they can add a "reader" to it and make it an audio book. That would have to wait for good text to speech technology, though.

Look at what the MP3 player did to your record/CD collection. Books are going the same route. Of course, this will take a generation to happen, since the older generation is tightly knit with the physical book concept. The older generation did not grow up with computers. The new generation is growing up with computers and MP3 players and what not. They are more prone to adopting the eBook than anybody else.

In this day and age of access anything anywhere, eBooks are here to stay.