Ebook Readers: It’s All About Price

[Kris777]

http://mobilitysite.com/2009/09/eboo...l-about-price/

In a recent comment, Doogald mentioned that in his opinion the relatively high price of Ebook Readers was keeping them from being more widely adopted….now there is data to back him up.

In a recent survey, consumer product researchers Forrester asked a straight forward question…"At what price would you consider an electronic book device/eBook reader expensive but still purchase it?" The answer was not really surprising, but very very clear. The graphic above speaks for itself. Once you drop below that magical 99 Bucks price point, people interested in buying EReaders effectively doubles. More importantly, once you get less then 99 dollars, more than half of all online adults and about three quarters of upper middle class, frequent book readers would be willing to at least consider the purchase.

That $99 Dollar price point also tends to be the magic number for phones and MP3 players as well…it just has that combination of feeling like an affordable splurge, I suppose. At this point, Ereaders start at around $199 for the Sony Pocket and go up into the mid $400s for the Kindle…but with these kind of numbers there is clearly a market need for a cheaper, well designed, widely distributed model. Whoever gets it out to consumers FIRST will have the chance to be to EReaders what Apple was to MP3 Players, or at least what Asus was to Netbooks…that is, the market will be theirs to lose.

Alright vendors….GO.

[GA Russell]

I've felt from the start that the concept of paying big for both the reader and the books was asking too much from the public. Either the reader or the books should be very, very inexpensive.

I wonder how little the industry a year from now could sell a device with no bells and whistles for; for example, something to read novels on. No pdf requirements, no photos and graphs, no wireless, no TTS. I would have the SD card capability, however, and I like the Jinke and Netronix user-changeable batteries. How low a price-point would that have?

[Kris777]

Originally Posted by GA Russell

I've felt from the start that the concept of paying big for both the reader and the books was asking too much from the public. Either the reader or the books should be very, very inexpensive.

I wonder how little the industry a year from now could sell a device with no bells and whistles for; for example, something to read novels on. No pdf requirements, no photos and graphs, no wireless, no TTS. I would have the SD card capability, however, and I like the Jinke and Netronix user-changeable batteries. How low a price-point would that have?

I think many eBook readers will be available for FREE (same as cell phones with one or two years plan now) very soon.

[Jellby]

I would create the "Internet Dollar" (IDO), and make it 1 IDO = 3 USD. Now they could advertise a $299 device as "only 99.7 Internet dollars!!!"

[kennyc]

Originally Posted by GA Russell

I've felt from the start that the concept of paying big for both the reader and the books was asking too much from the public. Either the reader or the books should be very, very inexpensive.

.

Yep. It think that is where Sony is trying to go with the PRS 300, but not to the level indicated in the research yet...

I'm a recent ebook convert - Sony 505. And the thing that pushed me over the edge was the freely available classic literature (much of which is on my reading list), the somewhat reasonable price of some ebooks (e.g. < $10 U.S.), and the ability to electronically check out books from my local library.

So for me it was the (cheap) content that justified the purchase of a "single function" $300 device.

[Sweetpea]

Can somebody explain the last two blocks?

Once you go over the 300 dollar mark, the first column (I'm planning to buy one) rises again...

[kennyc]

I think it's the typical "bell curve" type thing. Likely those are specialized users/usages where price likely doesn't matter.

[Andybaby]

the $99 reader.

I dream of one, but who do you think will make it? I don't see Sony doing it. but they did surprise me with the price of their 5" at 199. I expected them to put it for 250.

the third party readers seem to be priced way above the competition. and amazon is still liking its expensive kindle.

hmm its hard to see into the future. christmas '10 might be the time we see a $99 reader I expect. but really. its so close I'm not really sure.

the average cost of a reader has only dropped by about 25% in the last few years. so it would be hard. I would Not be surprised if it takes another 2 years for a reader to drop below the $99 mark.

Besides old devices. I expect the Jetbook to fall below 99 bucks soon(within 9 months). but I'm talking about new devices being sold for less than 100. not price drops.

[Crowl]

Until the rate of sales growth slows down in the existing market, there's just a compelling reason for the hardware makers to cut their profit margins significantly and when there's only one real option for screens thats another obvious reason why prices are staying fairly stable.

If pixelqi or somebody else can get out another competitive screen anytime soon then thats going to have a significant influence on prices.

[JSWolf]

Whoever setup the number did it rather poorly.

Under $98 should have been under $100. Why do you think Sony priced the 300 at $199.99. They did it because it's under $200.

[Abecedary]

Originally Posted by JSWolf

Whoever setup the number did it rather poorly.

Under $98 should have been under $100. Why do you think Sony priced the 300 at $199.99. They did it because it's under $200.

Except the whole point of this study is for market research purposes. When doing market research, you want to remove things like "psychological effects" (e.g., a $199.99 price) from the results. For this study, they've done that by lumping the $199 price point with the $200 price point, where it belongs.

To put it another way, if someone says they'll gladly pay less than $100 for something, they're not saying "I'll jump on it if the price is $99.99"—rather, they're saying "I'll buy it if it's a decent amount under $100."

Then again, I'm sure you know far more about this sort of thing than a highly-regarded research firm that's been doing this for decades.

[Floeee]

maybe the prs300 could make this way

so in europe, the prices are the same at america, but in euro
so if something costs 300$ its here at about 300 euro, which is dramatically more

but i think the first reader who could reach the magical 100 mark is maybe the prs300 when he is getting outdated, the prs505 has also fallen for about 50$ in price and a 50$ book gift, so it dropped for about 100

maybe we can see prs300 for about 150 with a gift certificate for about 50$ again in the end of 2010 when the colored displays are getting close to come out (irex wants to release a colored display in 2011)

[fugazied]

After hearing the Asus announcement recently, they are obviously the company most closely poised to release a super cheap reader device.

They already have the infrastructure and have worked with open source (free) software before. Their entry into the market might be $200 but they have a great advantage (as a hardware manufacturer) to get the cheapest touch devices into the market.

[carlobee]

this is so true. makes me think about the law of supply and demand during my Economics class when I was still in college.

[Kris777]

Originally Posted by Floeee

maybe the prs300 could make this way

so in europe, the prices are the same at america, but in euro
so if something costs 300$ its here at about 300 euro, which is dramatically more

but i think the first reader who could reach the magical 100 mark is maybe the prs300 when he is getting outdated, the prs505 has also fallen for about 50$ in price and a 50$ book gift, so it dropped for about 100

maybe we can see prs300 for about 150 with a gift certificate for about 50$ again in the end of 2010 when the colored displays are getting close to come out (irex wants to release a colored display in 2011)

If e-ink display alone cost at least $60 what is the total price that Sony pays to produce PRC-300 model? I guess more than $100. If so they can't sell this model for $100 or less...