Quote:
Originally Posted by Kingston
Bottom line: Sony's ereader division is a tiny portion of this great companies revenue. Bezos and Amazon have a much greater stake in making the Kindle a long term winner. Sony can bow out gracefully in a few years, just as they did with their TiVo and WebTV. They will probably offer a Reader for years to come, but don't expect them to fight a losing battle against Amazon when it is not in Sony's best financial interest to do so.
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I don't own a Sony Reader, and wouldn't take it as an insult if I did.
My reference point is the Sony Clie line of Palm OS PDAs. They were innovative and popular, but Sony folded the line and got out of the PDA market. The Clies made money, but they didn't make
enough money. As you point out, Sony is a major corporation with a bottom line orientation. Senior management at places like that are custodians of Other People's Money. They have a fiduciary responsibility to invest corporate funds where they will generate the best returns. Sony management looked at the Clie line and decided they could get a better return on the investment putting the funds in other areas.
Whether Sony will continue to support the reader depends on how well it does. Sony is a large company, and needs a fairly significant return to justify the investment. If they can make the reader a mainstream product and get that sort of return, they may be in it for the long term. If not, they may abandon it. It's too early to say right now what may happen.
Sony has tended to shoot itself in the foot with a bad case of "Not invented here", and an insistence on proprietary technology. Remember the Memory Stick? Instead of using something like Compact Flash or Secure Digital formats for expansion media, Sony chose to develop and use their own proprietary format. Sony is the only one that used it, and even they have finally decided to use SD in various products. The Sony LRF ebook format is a minor example. Why Yet Another Ebook Format?
Will Amazon win with the Kindle? Hard to say. Amazon's strength is the vast amount of content they can make available. Sony needs to increase the available content and address pricing to be competitive.
But Sony's strength is as a manufacturer of consumer electronics. They've had a lot more experience in designing, making, and selling devices to play content. If it should become possible to view AZW files on a Sony Reader, a lot of Amazon's advantage in content goes away.
And Amazon is not a consumer electronics manufacturer. This is a new area for them. They are also a large corporation with a need to generate a suitable return on an investment, so they will face the same pressures that Sony does in making their device a mainstream product. If they can't expand the Kindle beyond a niche market item, they too, may choose to fold the product and put their money elsewhere.
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Dennis