Nook And Amazon Kindle E-Book Reader Prices Cut In Response To Apple iPad Launch
The Kindle reader seemed to be the ideal product for Amazon. Its dominance of the e-book reader market was complete, it enjoyed approximately 60% of all e-book reader sales, and it was very difficult to see where the competition was coming from. There were numerous predictions of a “Kindle killer”, but despite the release of competing readers by the likes of Sony, Barnes and Noble, Plastic Logic and Bookeen, the Kindle looked very secure in its number one position.
Then Apple launched their long awaited iPad and, although it is a completely different device, it did look set to upset Amazon’s plans somewhat. Apple’s iPad, as many industry analysts have been quick to point out, is not without some fairly major flaws of its own, but the sheer number of consumers who would buy practically anything with the Apple logo on it will be more than enough to make a major dent in the Kindle’s sales figures.
As well as releasing new, sexy hardware, Apple also agreed a deal with many of the major publishers which let them charge whatever they liked for e-books – as long as they weren’t offered for less on any other device – the Kindle in other words. This appeared to scupper Amazon’s plans to price all e-books at $ 9.99 or lower. It certainly seems that e-book prices have been trending up since the launch of the iPad. It does seem a little strange that increased competition should drive prices upwards – but there you have it.
It’s a different story with the actual e-book reader hardware however. The price of the Nook from Barnes and Noble has been reduced to $ 199 from $ 259. Amazon have now dropped the price of the Kindle 2.0 from $ 259 to $ 189 – a very low number considering that it retailed at $ 359 when it was launched in February of 2009. The price of the large display Kindle DX has also been reduced from $ 489 to $ 379, an event which coincides with the device’s first upgrade which includes a higher contrast screen and a new body color.
Even the top of the range DX model is now more $ 100 cheaper than the entry level Apple iPad. Unlike the Kindle family, iPad users also have to pay a monthly fee for their 3G connection. Of course, the iPad is very much more than just an e-book reader, so it may very well be the case that people are happy to pay more for a more versatile and powerful device – even if it does have much shorter battery life and a less “reader friendly” screen (which excels for other applications).
It will be interesting to see if this downward price movement of e-book readers is just a temporary reaction to the iPad or whether it heralds the start of a new pricing policy. It could be that companies like Amazon and Barnes and Noble might take advantage of the trend for higher priced e-books by offering lower priced hardware secure in the knowledge that they will make their profit throughout the life of the device. Or, in Amazon’s case at least, it could be no more than a holding tactic until the next generation color Kindle hits the market later this year.
