The Kindle ecosystem - how big is it really? Analyst takes a guess.

[fjtorres]

Originally Posted by TadW

It looks as if Amazon generates more revenue selling Kindles than selling digital wares (including e-books). On the other hand, I have no doubt that earning margins on e-books are a lot higher.

The guesstimate says as much.
Unavoidable, since the average ebook price is a dozen times lower than even their cheapest reader. They would need an attach rate of over thirty to match the revenue from the average Kindle gadget, which is skewed high by the FIRE line.

[Andrew H.]

Originally Posted by Alexander Turcic

$5.5 billion a big number, but not that big if you keep in mind that, in 2012, Amazon's total revenue was a whopping $61 billion, with forecasts for 2013 somewhere

I disagree; I think that's a *huge* number. Amazon sells a vast quantity of items, and if almost 10% of those items consist of tablets and e-readers, that's a very large amount. It probably also bodes well for Amazon that these devices encourage the purchase of more products from the Amazon *ahem* ecosystem.

Originally Posted by Rizla

Ecosystem. Noun. Pity ecosystem, a case of what happens when good words fall in with a bad crowd. Rebecca Greenfield explains, "This reasonable science-related word has been co-opted by the tech writing community, which has senselessly ravaged it. The true meaning of the term translates to a 'biological community of interacting organisms and their physical environment.' As in, the place where living things live together. To tech writers, however, ecosystem involves a lot of non-living things that just happen to share characteristics. The Android ecosystem, the app ecosystem, the tablet ecosystem, the digital ecosystem, the start-up ecosystem — it's not like at the end of the day all the little gadgets go home to their gadget neighborhoods and hang out."

Greenfield is an idiot. Her first assignment is to look up the word "metaphor."

Have I missed her earlier pieces on how tech writers are misusing the term "walled garden," which can only refer to an area of vegetation enclosed by a masonry barrier?

Or how "Windows" can only refer to a hole in a wall installed for the purpose of letting in light and air?

[tubemonkey]

Originally Posted by Andrew H.

Greenfield is an idiot. Her first assignment is to look up the word "metaphor."

Have I missed her earlier pieces on how tech writers are misusing the term "walled garden," which can only refer to an area of vegetation enclosed by a masonry barrier?

Or how "Windows" can only refer to a hole in a wall installed for the purpose of letting in light and air?

LOL

[fjtorres]

For the record:
http://en.wikipedia.org/wiki/Business_ecosystem

The concept first appeared in Moore's May/June 1993 Harvard Business Review article, titled "Predators and Prey: A New Ecology of Competition", and won the McKinsey Award for article of the year.[2]
Moore defined "business ecosystem" as:
“An economic community supported by a foundation of interacting organizations and individuals—the organisms of the business world. The economic community produces goods and services of value to customers, who are themselves members of the ecosystem. The member organisms also include suppliers, lead producers, competitors, and other stakeholders. Over time, they coevolve their capabilities and roles, and tend to align themselves with the directions set by one or more central companies. Those companies holding leadership roles may change over time, but the function of ecosystem leader is valued by the community because it enables members to move toward shared visions to align their investments, and to find mutually supportive roles.”[3]
Moore used several ecological metaphors, suggesting that the firm is embedded in a (business) environment, that it needs to coevolve with other companies, and that “the particular niche a business occupies is challenged by newly arriving species.”[4] This meant that companies need to become proactive in developing mutually beneficial ("symbiotic") relationships with customers, suppliers, and even competitors.
Using ecological metaphors to describe business structure and operations is increasingly common especially within the field of information technology (IT).

That is twenty years ago and the term has been bandied about in the media since at least 1995 to explain how Windows steam-rolled OS/2 and the other contenders for the desktop.

[Alexander Turcic]

Originally Posted by fjtorres

That is twenty years ago and the term has been bandied about in the media since at least 1995 to explain how Windows steam-rolled OS/2 and the other contenders for the desktop.

OS/2!!!!!!!!! I loved that OS. Real multitasking as opposed to the flaky cooperative "multitasking" of Windows 3.1. (real OT, I know)

[fjtorres]

Originally Posted by Alexander Turcic

OS/2!!!!!!!!! I loved that OS. Real multitasking as opposed to the flaky cooperative "multitasking" of Windows 3.1. (real OT, I know)

It was a real OS but IBM marketed is a Desqview competitor (a system integration tool) instead of as a desktop OS. The DRAM cartel's price fix also screwed them over big time.
By the time the feds busted the cartel, MS had NT 3.5 and a fully fleshed out Win32 ecosystem.

Understanding the needs of the end user is as critical for computing platforms as for content platforms. Amazon obviously learned the right lessons from those that came before and fell flat on their face by not building a solid ecosystem.

(See? Not off-topic.)

[Synergi]

Originally Posted by ucfgrad93

When lawmakers start writing a coherent tax code.

I think he means when do we in non taxed states have to pay.

Everyone seems to think it will be an even playing field if Amazon has to charge taxes. I'm betting it won't. Amazon is busy investing in its infrastructure, that little thing most companies, cities, governments cheap out on.

Best buy wants to charge me how much to deliver my uber 80" TV? What's that you say? Amazon will overnight it for 4 bucks if your prime or two days (sometimes still faster then best buy delivers) for free? And soon that may be free one day deliver. If they pay tax they will start opening warehouses all over.

[doctorow]

Originally Posted by Synergi

Everyone seems to think it will be an even playing field if Amazon has to charge taxes. I'm betting it won't. Amazon is busy investing in its infrastructure, that little thing most companies, cities, governments cheap out on.

You're totally right.

Did you know:

In the UK alone, Amazon made £4bn in revenues in 2012. In contrast, for the same fiscal period, they paid a total of £2.4m in taxes. That's £0.1m short of the government grant they received to expand the company's warehouse operation in Scotland. Linky

[jersysman]

Originally Posted by Synergi

I think he means when do we in non taxed states have to pay.

Everyone seems to think it will be an even playing field if Amazon has to charge taxes. I'm betting it won't. Amazon is busy investing in its infrastructure, that little thing most companies, cities, governments cheap out on.

Best buy wants to charge me how much to deliver my uber 80" TV? What's that you say? Amazon will overnight it for 4 bucks if your prime or two days (sometimes still faster then best buy delivers) for free? And soon that may be free one day deliver. If they pay tax they will start opening warehouses all over.

Amazon has already started the tax thing in my state. They do have a warehouse here, but I think I would still forego not being charged taxes than getting the occasional item in 1 day. But, I'm not complaining. Still better than most other alternatives.

[pilotbob]

Originally Posted by jersysman

Amazon has already started the tax thing in my state. They do have a warehouse here, but I think I would still forego not being charged taxes than getting the occasional item in 1 day. But, I'm not complaining. Still better than most other alternatives.

I don't mind paying sales tax, but it I think it should be equitable. Either they charge everyone sales tax, or no one.

BOb

[JAcheson]

Originally Posted by Alexander Turcic

OS/2!!!!!!!!! I loved that OS. Real multitasking as opposed to the flaky cooperative "multitasking" of Windows 3.1. (real OT, I know)

I was a big fan of OS/2 as well. I especially remember the widget that let you download apps for it, which was a solid decade ahead of its time.

[WillysJeepMan]

Originally Posted by fjtorres

It was a real OS but IBM marketed is a Desqview competitor (a system integration tool) instead of as a desktop OS. The DRAM cartel's price fix also screwed them over big time.
By the time the feds busted the cartel, MS had NT 3.5 and a fully fleshed out Win32 ecosystem.

Understanding the needs of the end user is as critical for computing platforms as for content platforms. Amazon obviously learned the right lessons from those that came before and fell flat on their face by not building a solid ecosystem.

(See? Not off-topic.)

We didn't market OS/2 as a DesqView competitor. Your view of history regarding OS/2, NT, and other systems of the time are quite inaccurate.

[fjtorres]

Originally Posted by WillysJeepMan

We didn't market OS/2 as a DesqView competitor. Your view of history regarding OS/2, NT, and other systems of the time are quite inaccurate.

"A better DOS than DOS, a better Windows than Windows", and an SDK for line of business corporate apps.
No effort to market to end users.
That is exactly what DesqView (and TopDesk) among others, offered.
They may not have realized it but a system integration tool is what they were marketting. And I'm not making that up; that was the consensus post-mortem on OS/2 in the late 90's. And I heard that very phrase from our IBM rep when we bought our first-gen RS/6000s.
MS targetted the needs of end users and IBM targetted the desires of the glass house gang. Unfortunately for them, in the real world needs trump desires, even those of gatekeepers.

We're seeing a replay in trade publishing right now.

[WillysJeepMan]

Originally Posted by fjtorres

"A better DOS than DOS, a better Windows than Windows", and an SDK for line of business corporate apps.
No effort to market to end users.
That is exactly what DesqView (and TopDesk) among others, offered.
They may not have realized it but a system integration tool is what they were marketting. And I'm not making that up; that was the consensus post-mortem on OS/2 in the late 90's. And I heard that very phrase from our IBM rep when we bought our first-gen RS/6000s.
MS targetted the needs of end users and IBM targetted the desires of the glass house gang. Unfortunately for them, in the real world needs trump desires, even those of gatekeepers.

We're seeing a replay in trade publishing right now.

One of my assignments during my career in IBM was as an OS/2 developer. My group worked with the marketing teams and Microsoft liaisons from the late 80's to the mid-90's. I was intimately involved in what went down.

OS/2 was not originally intended to be an end-user OS. It was only after an unfortunate series of interactions with Microsoft that caused us to shift the focus, but by that time too much valuable time was lost. But OS/2 was extremely successful for it's primary target... mission critical business. So much so that virtually all of the banking systems ATMs ran OS/2 at one point in time... there are quite a few that still do and OS/2 continues to be supported (albiet by a much smaller company)

If the lesson you take away from the OS/2 story is that "IBM targeted the desires of the glass house gang vs MS' targeting end user needs" then you learned the wrong lesson.

[fjtorres]

Originally Posted by WillysJeepMan

OS/2 was not originally intended to be an end-user OS. It was only after an unfortunate series of interactions with Microsoft that caused us to shift the focus, but by that time too much valuable time was lost. But OS/2 was extremely successful for it's primary target... mission critical business.

Exactly.
OS/2 was conceived as the cornerstone of SAA to pull desktop computing back into glass house control. It was a mistake to use it for a market IBM had no understanding of.

And whatever the marketing guys thought they were selling, given the paucity of end user apps, what their users were *really* buying was a system integration tool. The marketers aimed at Windows and killed Desqview.

It succeeded at mission-critical systems because that is where the market saw it shine. Because it lacked ISV apps and an end-user grade ecosystem it failed to sell to people interested in end user productivity which just happened to be 95% of the PC business.