Quote:
Originally Posted by Kali Yuga
Because Amazon's managers know how to run a business. 
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The only problem this solves is "how will skinflints get their hands on new books?" |
Correct on both counts.
Just because a customer can be identified for a product/service doesn't mean there is a viable business to be found in meeting that demand.
A good manager understands that some customers are best left unserved or, better yet, redirected to a competitor.
I find amusing the constant carping about the Kindle line's lack of epub, library, and ADE support; as if that were some kind of failing. It isn't. It is a design *feature*. Kindle readers and apps exist, first and foremost, to sell Amazon ebooks; not to meet the needs of readers whose appetite for content exceeds ther willingness to pay (to put it kindly). Making a good reader that sells at a good price is a means to an end, not an end unto itself.
The reason Amazon is so much more succesful than their competitors is because they are cherry-picking the ebook-buying market, drawing in those customers who don't mind buying most of their content and leaving the rest to their competition.
In the video game industry, which ebooks are starting to resemble, there is an important term that exemplifies the fact that not all customers are equally valuable to a platform holder: attach rate. At its simplest, this is the ratio of unit game sales divided by the number of unit consoles sold. This current console generation, the Nintendo Wii has clearly outsold the second place Xbox 360 in total number of consoles sold, yet the 360 regularly ranks way higher in total game sales and has recently been generating more game software revenue than the Wii and Sony PS3 combined. This is due to a combination of factors but it is mostly due to the Xbox managers' relentless focus on marketing the 360 as a gaming platform for serious gamers. Where the Wii drew in buyers who hadn't previously owned game consoles and Sony drew in buyers interested in the PS3 as a bluray player, Microsoft drew in a disproportionate share of buyers who's primary interest was gaming and routinely bought 8-10 or more games a year. In simple attach rate terms, the average Xbox owner has bought 9+ games per console while Sony and Nintendo buyers average more like 6 games. And this in an industry with healthy used and rental businesses on the side.
If Amazon ebook unit sales are outpacing their pbook sales it is because Kindle buyers buy a lot of books, not just because they've sold a Lot of Kindles. (Though it surely helps.) If there were any kind of reliable tracker of ebook and reader sales it would clearly show that Kindle has a higher attach rate than any of its competitors because it doesn't support library access and because you don't need a Kindle to buy and read Kindle books.
It is all to easy to focus overmuch on the Kindle hardware and forget that Kindle is also software. And even easier to forget that the real focus is the books. Amazon management is doing exactly what they set out to do: sell ebooks. Everything else is secondary or irrelevant.