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Old 03-21-2012, 05:44 PM   #13
geoffwood
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I suspect Amazon are also seeing diminishing returns and reduced revenue per device.

With each price drop they lower the barrier to entry to the world of e-readers, but I suspect that the newcomers also read correspondingly fewer books. if they read more they would have been with the early adopters. So the newer users are more casual, less frequent users. If that is the case, not only is Amazon getting less upfront revenue per device, but also less recurring revenue from book purchases. Maybe they have scooped up all the additional users attracted to the $79 price tag and won't see another large sales spike until they drop the price again?
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