Sony's announced deal with News Corp. to port content from the Wall Street Journal, MarketWatch and the New York Post onto its e-readers marks a further escalation in the holiday battle between various manufacturers pushing mobile reader devices. At the same time, Amazon.com has announced that its Kindle line is experiencing its best sales month so far. Despite earlier analyst predictions that e-readers would remain a niche product and a slow seller in 2009, the massive hype surrounding the Kindle, Nook and other devices suggests that they could be experiencing much more rapid mainstream adoption.
Sony announced on Dec. 17 a deal with News Corp. that would make content
from the Wall Street Journal, MarketWatch and the New York Post available on
its e-readers, in another sign that the battle between various companies over
the electronic book market is intensifying as 2009 comes to a close. Amazon.com
and Barnes & Noble already offer periodical content on their respective Kindle
and Nook lines, while other companies such as Plastic Logic are reportedly in
talks with publishing companies.
According to Reuters,
Sony will offer monthly subscriptions to the Wall Street Journal for $14.99,
MarketWatch for $10.99 and the New York Post for $9.99.
Meanwhile, Amazon.com claimed that December was the best sales month so far
for the Kindle line, and said it would ship the device on an expedited basis to
customers for free. However, the online retailer continued its tradition of
refusing to break out exact sales figures. Amazon.com CEO
Jeff Bezos has previously been quoted as saying sales of the Kindle and
associated e-books account for roughly 35 percent of the company's book-related
A Dec. 1 research note by financial advisory group Collins Stewart estimated
could sell as many as 550,000 Kindle devices in 2009.
The note's chief
author, Sandeep Aggarwal, broke that down as 450,000 Kindle 2 devices and
100,000 Kindle DX devices, although there was no mention of how those figures
Overall, Aggarwal predicted about $301.4 million in Kindle revenue in 2009,
increasing to $671.4 million in 2010, $1.2 billion in 2011 and $1.8 billion in
Earlier in the year, a report from Forrester Research predicted that about 3
million units would be sold in the United States
in 2009, although that was before the introduction of Barnes
& Noble's Nook
and the massive holiday-related marketing push by
Amazon.com. The increased competition between device makers has been driving
the price of e-readers down, with Amazon.com reducing the price of the Kindle 2
to $259 to match that of the Nook. Sony's e-readers retail roughly within that
and Barnes & Noble have also been introducing applications that port their
e-reader functionality onto devices such as the iPhone
in an attempt to
gain a little more market share and mind share.
"The cost of the display component is high and sales volumes are still
modest, yet consumers demand and expect ever-lower prices," Sarah Rotman
Epps, a Forrester analyst, wrote in the Sept. 1 research report. "The
bottom line: E-reader product strategists will have to educate consumers and
innovate to bring prices down. Even if they are entirely successful at both
these feats, e-readers will never be mass-market devices like MP3
If manufacturers want e-readers to become ubiquitous within the marketplace,
Epps added, the price will have to come down drastically, perhaps even to as
low as $50. At that point, though, the relatively high cost of components would
become a larger factor, possibly forcing manufacturers to seek what Epps
referred to as a "subsidy."
Amazon.com was initially helped in its market penetration by a series of
high-profile launches for each successive device, including a Feb. 9 event for
the Kindle 2 involving a reading by horror maestro Stephen King. Since then,
though, a number of new e-readers have made the marketplace more crowded.
Smaller companies such as Plastic Logic have attempted to carve off a piece of
the market by announcing that their e-readers will be targeted toward specific
customer segments, such as business users.
Although Barnes & Noble experienced a good deal of publicity when it
announced the Nook in October, early reviews from the Wall Street Journal and the
New York Times have suggested that the device needs further refinement. Barnes
& Noble has claimed that massive demand has delayed shipments of the Nook
to both stores and customers until the first week of January.
It will likely be much longer than early January, though, before solid
figures emerge to back the various manufacturers' claims about their products'
sales. Until then, the hype surrounding e-readers seems to be shouting down
those earlier predictions that the devices will remain a niche product.