[SensualPoet]

The Kindle/Gillette model - No, the Amazon's e-readers are not the razors and their e-books are not the blades. Some folks insist e-readers are being sold below cost but there is no evidence of that. In fact, the large number of players and wannabes with devices in market suggests e-readers are being sold to generate profit. In a nascent industry, lots of players make mistakes, are under-funded, fail to execute, fail to make business relationships to open sales channels, etc. And some prosper.

The model to look at is iPod/iTunes. Apple is making lots of money, thank you, selling iPods ... but it's because they can sell volume and build brand loyalty thanks to iTunes. Lots of other companies make mp3 players, but they lack the iTunes link. Even when iTunes content is DRM free ... iPods have the upper hand. They have made the acquisition of content and playback painless. Amazon ought to be selling mp3s by the billions yet they are a blip in the music market. For e-books, Amazon has taken the iPod/iTunes model as a starting point. Yes, Amazon sells Kindles which talk to the Kindle store seamlessly ... but it's also extended its reach through apps for computers, mobile phones and the emerging tablet market. In a recent statement, Amazon revelaed 25% of Kindle content buyers do NOT have a Kindle. It's not about the razor -- it's about seamless acquisition and playback.

Sony as an electronics company - Yes, they are CE (consumer electronics) experts and produce a wide range of handsome equipment. They have missed the boat with e-readers, in spite of being early leaders because they failed to deliver the seamless experience. Hobbyists will diddle with Calibre; mainstream consumers will graviate to Amazon's single device: search for it - sample it - buy it - read it model. There is room for ADE in all this but unless it's as seamless as Amazon's flow, its will lose ultimately. Sony is treading water where it used to be leading. That is Sony's corporate choice.

The other players - Nook in the US, Kobo in international markets, and a plethora of other players, some with strong regional strengths (ie Pocketbook). With Sony, many share something in common: DRM ePub running Adobe ADE. A little consolidation, some prudent alliances, and a sensible content strategy -- there is lots of room for multiple players led by one of the current larger players. Amazon is strong in English speaking content -- esp in the US -- and you can expect it to use ebooks to expand into other regions and languages. Yet ePub is really strong in many markets outside the US -- this is the opportunity every wannabe has ... how many will step up?

The elephant in the room is Apple'siPad - No, it's just another player and it's not a very good e-reader if that is the primary reason to own it. If there is an elephant it might be Android-based devices and both Amazon and Kobo are poised to pounce ... leaving consumers with DRM azw and DRM epub choices ... on a single device. And that is exactly why DRM ceases to be a bugaboo: consumers can be terrifically happy with Amazon as sole content provider; or Kobo and other DRM ePub vendors as content provider; and be able to choose a device that plays both, or a modestly priced dedicated device that does one or the other.

Finally, those who want to scribble in the margins: the academic community. So, ok: no current device meets the needs of this group yet, in functionality or price point. It is smaller market than e-readers are aiming at: Forrester suggests 10% of Americans buy 2 or more books a month and this reader decile is where the dedicated devices are aimed. But, see, that's only 30 million Americans -- and lots more "read". For them, the non-dedicated platforms are acceptable and that expands the market hugely. Now look at world consumption. There is a very bright future for e-readers, dedicated and part-time; and an even brighter future for those who figure out how to drive content to all of those devices seamlessly.