Lower Kindle cost thru cell phone adoption model - Page 2

Thomas Ryan · 03-04-2009, 09:31 AM

Quote:

Originally Posted by scotty1024

I personally liked the Softbook Reader model. They sold me the Softbook Reader for $200 and I agreed they could charge me $19.95 a month for two years in book store credits. If I didn't use all of my $19.95 it rolled forwards. If I spent more than $19.95 they charged it.

Worked great.

Assuming Amazon did a similar deal, it sounds like you would be willing to pay $200 + ($19.95 * 24) = $678 for the device, plus a two year commitment, and an assumption that you would find and buy $478 worth of material during the next two years. Instead of paying a simple $360 you would create an obligation/liability for yourself of another $318. I find that curious.

Is it a cash flow win (you only have $200 in your pocket and you want it now)?
Assuming you set aside the $20/month, you would have to wait eight more months to accumulate the one-time $360. Is that the trade-off?

Would you pay $678 up front and agree to buy $478 worth of content over the next two years? Help us understand how this works for you.

Alisa · 03-04-2009, 12:39 PM

Quote:

Originally Posted by Thomas Ryan

Assuming Amazon did a similar deal, it sounds like you would be willing to pay $200 + ($19.95 * 24) = $678 for the device, plus a two year commitment, and an assumption that you would find and buy $478 worth of material during the next two years. Instead of paying a simple $360 you would create an obligation/liability for yourself of another $318. I find that curious.

Is it a cash flow win (you only have $200 in your pocket and you want it now)?
Assuming you set aside the $20/month, you would have to wait eight more months to accumulate the one-time $360. Is that the trade-off?

Would you pay $678 up front and agree to buy $478 worth of content over the next two years? Help us understand how this works for you.

The piece missing for me here is what kind of price savings folks got on the books if they signed up for the $20/month subscription. If that saved them money over what they would have spent without it, then it could be a good deal depending on how many books they bought.

lilac_jive · 03-04-2009, 01:13 PM

Quote:

Originally Posted by Thomas Ryan

Assuming Amazon did a similar deal, it sounds like you would be willing to pay $200 + ($19.95 * 24) = $678 for the device, plus a two year commitment, and an assumption that you would find and buy $478 worth of material during the next two years. Instead of paying a simple $360 you would create an obligation/liability for yourself of another $318. I find that curious.

Is it a cash flow win (you only have $200 in your pocket and you want it now)?
Assuming you set aside the $20/month, you would have to wait eight more months to accumulate the one-time $360. Is that the trade-off?

Would you pay $678 up front and agree to buy $478 worth of content over the next two years? Help us understand how this works for you.

I can put my two cents in. For me it wouldn't be an issue of getting the cash for the device, but to be rewarded for using their store. I wouldn't want to pay it in a lump sum, but monthly, just like a cell phone. I already buy $30 in books or more a month. Maybe not a lot of people would go for it, but it sounds pretty easily executed.

pilotbob · 03-04-2009, 10:40 PM

Quote:

Originally Posted by Alisa

The piece missing for me here is what kind of price savings folks got on the books if they signed up for the $20/month subscription. If that saved them money over what they would have spent without it, then it could be a good deal depending on how many books they bought.

So you want a $200 Kindle AND you want to pay less for books.

People, Amazon is in business to make money, not give stuff away. They are selling the things out at the current price, and 10% of their books sales are Kindle books.

BOb

Ervserver · 03-04-2009, 11:27 PM

The market will determine pricing strategies and it could become very creative, hopefully.

Alisa · 03-04-2009, 11:30 PM

Quote:

Originally Posted by pilotbob

So you want a $200 Kindle AND you want to pay less for books.

People, Amazon is in business to make money, not give stuff away. They are selling the things out at the current price, and 10% of their books sales are Kindle books.

BOb

Dude. I was agreeing with you back there. This post was just about wondering how the subscription plan worked. Sheesh.

pilotbob · 03-04-2009, 11:31 PM

Quote:

Originally Posted by Alisa

Dude. I was agreeing with you back there. This post was just about wondering how the subscription plan worked. Sheesh.

No worries. I didn't mean anything personal in any way.

BOb

rlsquires · 03-06-2009, 08:54 AM

Liked the SoftReader approach mentioned here - buy on a low monthly installement and get credit on dollar of books bought. Basic rule of product development is the higher the volume the lower the unit cost. In these tough economic times, they will have to be creative to accelerate volume after the "early adopter" buy phase.

Making the Kindle format available for iPhone is also a good idea. As a new author I'm all for it :-)

galavanter · 05-07-2009, 12:52 PM

Quote:

Originally Posted by Alisa

That all sounds great but it's not very sustainable at the moment. The Kindle is a fairly expensive device to produce. The e-ink screen and the controller aren't cheap. Amazon's taking very little profit and possibly a loss on many of the $9.99 new releases and best sellers. I think eventually the business will be able to support these kinds of pricing models but I doubt Amazon could sustain the business as it is right now if they did that.

Just reading this thread and thought I would toss this in if you don't mind (I hate being called dude

).

http://www.engadget.com/2009/04/22/i...net-says-shhh/

dmaul1114 · 05-07-2009, 01:06 PM

I don't think a subscription model would work very well. At least not if that was the only way it was available. As that would limit sale even more to only avid readers. I got a used Kindle 1 in early March and I've read 4 books so far and two of those were free books. Obviously any kind of monthly fee that was high enough to make it worthwhile for Amazon (say $20 or more) wouldn't be worth it for people like me.

The fact is that it's just a new technology and it will take a few years before prices drop and get to a level more acceptable in the mainstream. $200 was my absolute upper limit, and that's what I paid for my used Kindle.

Slow_hand · 05-07-2009, 04:19 PM

Those cost of materials are so meaningless, for one thing there is no cost of anything else, like the overhead just to keep a company running, which includes the lawyers, the IT guys, the accountants, the administrative staff, designers. Also the cost of making the product has almost no relationship to the cost of sale. It's how much people are willing to pay for a thing or service. When the Star Trek was first made available on consumer video, it sold by the episode, and people bought them. When the seasons became available on DVD, they were priced many times higher than other shows, but sold like hotcakes. Look how much people were willing to pay for Wii's.

If a business sets a price based only or even mostly on it's own costs, it's probably setting the wrong price.

Slow_hand · 05-07-2009, 04:21 PM

Duplicate

jwilker · 05-07-2009, 05:44 PM

To me an optimum solution would be a combination. Since I'm now paying .30 a day for kindlefeeder feeds, I'm already paying a monthly fee. Just not to Amazon. If I could get a kindle for $200, and a 2 year contract at something not huge for either unlimited date or a useful amount, I'd probably be ok with it, and make more use of my @kindle.com vs. my @free.kindle.com address

I wouldn't want a subscription for books. I like ownership, i want to own my music and my books (preferably DRM free, but it's not a perfect world).

$360 isn't super steep, but I think they'd fly off the shelves faster under $300. The combo of $360 and books only being slightly cheaper, means I'm buying a lot of books before I see the cost savings in owning a Kindle (i'm not address convenience, that's a win already)

krazy4katz · 05-07-2009, 08:21 PM

I personally prefer to pay the costs up front and not have a subscription. It is too difficult to regulate spending and ultimately more expensive with a subscription.

Alternatively, they could have a book club for kindle users for discounts on books. I wouldn't buy into it, but people who purchase lots of books might like it.

03-06-2009, 08:54 AM	#23
rlsquires Author Posts: 3 Karma: 10 Join Date: Mar 2009 Location: Murrells Inlet, SC Device: Kindle	Creative model to increase sales and help customers Liked the SoftReader approach mentioned here - buy on a low monthly installement and get credit on dollar of books bought. Basic rule of product development is the higher the volume the lower the unit cost. In these tough economic times, they will have to be creative to accelerate volume after the "early adopter" buy phase. Making the Kindle format available for iPhone is also a good idea. As a new author I'm all for it :-)

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03-04-2009, 11:27 PM	#20
Ervserver Wizard Posts: 2,624 Karma: 1008294 Join Date: Dec 2007 Location: Iowa, USA Device: Nook Simple Touch	The market will determine pricing strategies and it could become very creative, hopefully.

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dmaul1114 Wizard Posts: 2,300 Karma: 1121709 Join Date: Feb 2009 Device: Amazon Kindle 1	I don't think a subscription model would work very well. At least not if that was the only way it was available. As that would limit sale even more to only avid readers. I got a used Kindle 1 in early March and I've read 4 books so far and two of those were free books. Obviously any kind of monthly fee that was high enough to make it worthwhile for Amazon (say $20 or more) wouldn't be worth it for people like me. The fact is that it's just a new technology and it will take a few years before prices drop and get to a level more acceptable in the mainstream. $200 was my absolute upper limit, and that's what I paid for my used Kindle.

05-07-2009, 04:19 PM	#26
Slow_hand Groupie Posts: 190 Karma: 326 Join Date: Jul 2008 Location: Baltimore Device: Amazon Kindle 2	Those cost of materials are so meaningless, for one thing there is no cost of anything else, like the overhead just to keep a company running, which includes the lawyers, the IT guys, the accountants, the administrative staff, designers. Also the cost of making the product has almost no relationship to the cost of sale. It's how much people are willing to pay for a thing or service. When the Star Trek was first made available on consumer video, it sold by the episode, and people bought them. When the seasons became available on DVD, they were priced many times higher than other shows, but sold like hotcakes. Look how much people were willing to pay for Wii's. If a business sets a price based only or even mostly on it's own costs, it's probably setting the wrong price.

05-07-2009, 04:21 PM	#27
Slow_hand Groupie Posts: 190 Karma: 326 Join Date: Jul 2008 Location: Baltimore Device: Amazon Kindle 2	Duplicate

05-07-2009, 05:44 PM	#28
jwilker Connoisseur Posts: 97 Karma: 1940 Join Date: Apr 2009 Location: Denver, CO Device: Libra H2O	To me an optimum solution would be a combination. Since I'm now paying .30 a day for kindlefeeder feeds, I'm already paying a monthly fee. Just not to Amazon. If I could get a kindle for $200, and a 2 year contract at something not huge for either unlimited date or a useful amount, I'd probably be ok with it, and make more use of my @kindle.com vs. my @free.kindle.com address I wouldn't want a subscription for books. I like ownership, i want to own my music and my books (preferably DRM free, but it's not a perfect world). $360 isn't super steep, but I think they'd fly off the shelves faster under $300. The combo of $360 and books only being slightly cheaper, means I'm buying a lot of books before I see the cost savings in owning a Kindle (i'm not address convenience, that's a win already)

05-07-2009, 08:21 PM	#29
krazy4katz Addict Posts: 367 Karma: 1552656 Join Date: Feb 2009 Device: [Kindle 1, Kindle 3 (KK)], Kindle Voyage, iPad Pro	I personally prefer to pay the costs up front and not have a subscription. It is too difficult to regulate spending and ultimately more expensive with a subscription. Alternatively, they could have a book club for kindle users for discounts on books. I wouldn't buy into it, but people who purchase lots of books might like it.

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