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Originally Posted by doreenjoy
Thank you so much for taking the time to share this, Dennis.
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It's my pleasure. I'm in NYC, and the location of the event was in walking distance.
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I think Sony is throwing significant amounts of money at the Reader market. They've seen Kindle do well, and IMO they know they can do it one better with enough investment. Unlike other forms of entertainment, E-books are a growing industry in hard times -- when it's too expensive to go to a movie, folks stay home and read a book.
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Or stay at home and rent a video...
I agree that Sony sees potential in the reader market.
I think Amazon and Sony are approaching it from two different directions. For Sony, it's about the Reader. they're a consumer electronics company, and they want to sell devices -
lots of devices. In order to sell a device that's an ebook reader, they have to have content it can display, so they also had to create an infrastructure around it, including the Sony Store with books for purchase.
For Amazon, I think it's about the books. Amazon is a major retailer, and the 800lb gorilla in the book industry. Selling ebooks is a logical extension of their current business selling paper books, and attractive because ebooks don't require warehousing and shipping, and therefore have much lower costs. Amazon can price most titles at $9.99 and still make decent money.
But selling ebooks to the customers requires devices to read them on, and the Kindle is a means of jump starting the market, and making a bit of money on hardware as well.
My big concern back when Sony and Amazon were first cranking up was longevity. My usual ebook reader is a Palm OS PDA. Once upon a time, Sony was a major player in the PDA market, licensing Palm OS from Palm and producing a well regarded PDA line called the Clie. Many PDA owners considered the Sony Clies the best PDAs made.
Sony pulled the plug on the Clie line and exited the PDA market. The Clie was profitable, but not profitable
enough. Sony management had a fiduciary responsibility to invest corporate finds where they would generate the highest return, and decided the money invested in the Clie line could be better placed elsewhere.
So my question when Sony entered the reader market was "Will they be in it long term?" Sony is a big company, and needs big markets to make something worth doing. It wasn't clear the market for a dedicated ebook reader was large enough for Sony to profitably address.
It would seem Sony sees an opportunity, since they are still out there doing it.
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Dennis