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Originally Posted by RWood
Doubtful as this would add additional sources outside Sony for purchase of current material. This in turn would lead to a possible decrease in revenue through the CONNECT store.
Most companies make a small (if any) profit on the base unit and reap the big rewards from the ad-ons and continuing purchases. It is a lot like the razor blade market wherein the original purchase is break even but they earn substantial profits from the on-going blade sales.
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I'm going to sound like a broken record, but it really begs the question: What does Sony want to do with the Reader?
They seem dividided between profit on books vs. profit on the Reader itself.
According to Steve Jobs, the "make money off add-ons" is actually the
opposite model for the iPod. As Jobs has stated, the iTunes store exists solely to sell iPods.
Of course, a Reality Distortion Field Detector comes in handy around anything Mr. Jobs says.
In all seriousness, taking Mr. Jobs at his word (mostly), it's a good business model. They make a gajillion dollars off iPod sales, and the iTunes store acts as an easy-to-use way to get music onto said iPod. They charge a relatively small sum per song to encourage/keep iPod sales high. And while there is a large market for iPod add-ons, AFAIK Apple only makes one -- that "audiophile" (Reality Distortion Field Detector pegs hard on 11) speaker thing. That's beside adapters and cables of course. That alone says something about their business model.
Sony charges a relative arm and a leg for books on the Connect Store. You save about $1.00 on books over Amazon, vs. iTunes which garners about $7.00 savings per album over Amazon. Looks like Sony is
not using the iPod model for sales... and much to their detriment IMHO.
Alternative formats and inexpensive eBooks will encourage sales of the Reader. And that's what Sony needs most right now. After all, if the Reader isn't in users' hands, there's no profit off add-ons.
I personally love the LRF format, now that I have a way to convert text to it. But there's still like 8 other e-Book formats out there, and NO indication as to which will become the defacto standard. If Sony
just supported .lit, for example, it would open up tons of additional oppurtunities for content. (Yes, I know you can crack .lit, but the average person doesn't want to
need to.) Same for encrypted PDF.
Other formats
should top Sony's list of features. They need to sell the Reader, and allowing other formats is the second-best way to do this... since lowering prices on the Connect Store is probably too much to ask.
-Pie