By Dev Ganesan, CEO, Aptara
Amazon’s announcement of the Fire tablet, and new lower priced Kindle and Kindle Touch eReaders received a lot of attention yesterday, but does it really change anything for publishers? In short, on the technical and production fronts, not significantly, based on what has been announced thus far. However, on the sales and revenue fronts, it may mark a significant change.
For those who haven’t heard, Amazon announced not one, but three new devices. The first is a new Kindle priced at $79 (with special offers, $109 without) is now available. In Amazon parlance, “special offers” means that instead of photos or pictures on the sleep screen, Amazon presents targeted ads to the user, in exchange for a lower cost unit. The second is the Kindle Touch priced at $99 (with special offers, $139 without) available in November. A 3G version of the Touch will also be available for $149 (with special offers, $189 without) in November. And finally, the Kindle Fire tablet will be available in November for $199. The device formerly known as the Kindle is now called the Kindle Keyboard and is now available in WiFi or 3G models for $99 and $139 respectively (with special offers, $139 and $189 without). All the new devices will be able to read users’ current libraries. The ad for the Fire also states that it will come configured with your account right out of the box. The Touch and Fire devices are currently only being sold in the US.
The e-Ink Kindle Touch appears to be a direct challenge to the Kobo Touch and nook Touch released last summer, but at a lower price point. The Kobo and nook are both priced at $139. The Kindle Fire is a 7-inch Android-based tablet that features a highly customized Amazon based interface, rather than the typical Android UI, and seems to challenge primarily the B&N nookColor (priced at $249) as well as other Android tablets appearing almost daily. The 7-inch Android form factor has had limited success in the original Samsung Galaxy Tab and Blackberry Playbook, but it might be Amazon’s media offerings and cloud support that fans the Fire into a commercial success.
Through the Fire device, in addition to books, magazines and newspapers, users will be able to access other media available through Amazon including music, streaming video (through the Amazon Prime membership), and apps (from the Appstore for Android). Since Amazon is running their own app store, they can control what is available, meaning that you won’t find nook, Kobo, Bluefire or other eReader apps on a Fire. Book and media files can also be backed up to Amazon’s cloud servers. Also featured is Silk, which is a new web browser developed by Amazon.
What does this mean for publishers? The Fire does not support EPUB or EPUB 3, so a separate .mobi production stream will still be required, especially to produce more complex and interactive Amazon eBooks with features of the type allowed by the EPUB 3 format. One unanswered question is whether the Fire tablet will be able to access books currently being sold as “Kindle Editions with Audio/Video”. Currently only the Kindle for iPad/iPhone app is able to read these files and a quick check of the web site doesn’t give any indication that the Fire can. This new tablet, if so enabled, could be a unique opportunity for Amazon to support enhanced titles, opening an array of new possibilities within the Amazon eBook ecosystem.
What does this mean for the device landscape? It introduces a new concept in reading tablets that will likely spur eBooks sales and give Apple a run for its money as consumers seriously weigh their options between a $200 Kindle Fire and a $500 iPad. It might also cause Apple to reconsider pricing as they prepare to release the iPhone 5 in the coming weeks and the iPad 3, probably next spring. However, the iPad is a more general purpose device and still has capabilities that the Fire doesn’t, most notably, a camera. The connectivity with the Amazon Cloud Service is also very reminiscent of Apple’s iCloud announced earlier this year and due out when the iPhone 5 is released.
For the time being, Amazon will continue to be the sales leader (as documented in the recent results of Aptara’s Third Annual eBook Survey of Publishers) and appears to be directly challenging Kobo and B&N by selling reading systems at a lower cost. The conventional wisdom has posited that $100 is the threshold at which the mass market would adopt eReaders (one for every student in the classroom?). Amazon has now released 3 devices below that threshold, just in time for holiday giving.
As the eBook Survey of Publishers revealed, eBooks are just starting to generate a significant proportion of publishers’ revenues. Amazon’s new low cost products may greatly accelerate this trend – teetering a market on the verge.
Under Dev’s leadership, Aptara is playing a pivotal role in assisting the world’s leading publishers navigate and profit in the digital age. As the former head of both private and publically held companies (Intelliworks, TRADOS, Advanced Communications Systems) Dev’s entrepreneurial drive and long track-record of operational and financial success has resulted in Aptara’s expansion and evolution, from a technology vendor to a solutions partner−one that is helping publishers identify new products and revenue sources–and redefining the ‘book’ in the process.