Why is there no e-ink innovation in the USA?

[Nate the great]

Originally Posted by Phogg

When overbearing regulation sent manufacturing to Asia, design work followed.

Design work always does, regardless of product category.

That's half the story.

The other half of the story is that this is a niche market, and there's not much money in it.

So:

Originally Posted by cvkemp

It is called being priced out of the market. We cannot compete with the very low labor cost of the Asian countries.

[Nate the great]

Originally Posted by Rizla

Ipads and Iphones are made in Asia, yet they are sold here.

Those are also premium devices sold at premium prices in large volume and thus can fund expensive developers and designers. eReaders are budget devices in a tiny niche.

[ZodWallop]

Originally Posted by fjtorres

(If you need to blame somebody, blame B&N for the 4 hour price war of 2010.)

I went to read up on that. The world described seems so quaint now. $260 Kindles. Nook with 3G. Kobo was an upstart. Borders!

Yet even back then they identified $150.00 as the sweet spot for e-readers.

http://money.cnn.com/2010/06/21/tech..._cut/index.htm

[fjtorres]

Originally Posted by ZodWallop

I went to read up on that. The world described seems so quaint now. $260 Kindles. Nook with 3G. Kobo was an upstart. Borders!

Yet even back then they identified $150.00 as the sweet spot for e-readers.

http://money.cnn.com/2010/06/21/tech..._cut/index.htm

We're not there yet, but both Amazon and Kobo are trying to raise the prices of their mainstream models to where they can generate some profit and, yes, $150 does seem to be where they're headed. Neither seems overly fond of near-cost pricing.

[Pablo]

Originally Posted by HarryT

Will the next upgrade perhaps include apostrophes?

[DiapDealer]

Originally Posted by fjtorres

Eink is a niche everywhere.

I thought about specifying that, but ... I've little knowledge of other markets and the OP was specifically asking about the USA, so I punted.

Besides, I wasn't overly motivated to spend a lot of time responding to Rizla's annual "Amazon is Destroying e-reader Innovation" thread.

[Nate the great]

Originally Posted by DiapDealer

I thought about specifying that, but ... I've little knowledge of other markets and the OP was specifically asking about the USA, so I punted.

Besides, I wasn't overly motivated to spend a lot of time responding to Rizla's annual "Amazon is Destroying e-reader Innovation" thread.

snort

[fjtorres]

Originally Posted by DiapDealer

I thought about specifying that, but ... I've little knowledge of other markets and the OP was specifically asking about the USA, so I punted.

Besides, I wasn't overly motivated to spend a lot of time responding to Rizla's annual "Amazon is Destroying e-reader Innovation" thread.

Annual?
I thought it was quarterly.

Anyway, ebooks themselves are niche products outside NorthAm, UK, and Japan. Possibly Russia and a few small countries here and there.

[Rizla]

Originally Posted by fjtorres

So ereader sales are driven by the nature of the ebook market, not the converse. Most people decide first where they're going to get their ebooks and then look for a reading device that lets them get there.

In the US, that means that 70% of the market chooses Kindle.

Are you saying we see less e-ink innovation in the USA market because of Amazon's dominance?

[ZodWallop]

Originally Posted by fjtorres

We're not there yet, but both Amazon and Kobo are trying to raise the prices of their mainstream models to where they can generate some profit and, yes, $150 does seem to be where they're headed. Neither seems overly fond of near-cost pricing.

Kobo I can understand. Amazon a little less. When you have 70% of the e-book market, I'd think the Kindles could almost be loss leaders. Though I guess profit is always better than not profit.

[ZodWallop]

Originally Posted by Rizla

Are you saying we see less e-ink innovation in the USA market because of Amazon's dominance?

Since B&N stuck their heads in the sand with with the Nook Glowlight, I think Amazon has done an admirable job of pushing the e-reader market forward. The Paperwhite was an improvement over the NST Glowlight (screen-wise anyway), the Voyage looks like a beautiful piece of equipment and the newest Paperwhite took that high resolution screen and stuck it in a cheaper e-reader. Plus their recently improved layout engine and Bookerly font look very nice.

[susan_cassidy]

Kindles are loss leaders. For the most part, Kindles are not profitable for Amazon - ebooks are.

[patrickt]

I was interviewed and asked my thoughts on sex education in grammar school. "It's a great idea. If they taught sex the way they teach reading by the time kids reached puberty they wouldn't want to do it." I was being facetious but I might have been right.

[fjtorres]

Originally Posted by ZodWallop

Kobo I can understand. Amazon a little less. When you have 70% of the e-book market, I'd think the Kindles could almost be loss leaders. Though I guess profit is always better than not profit.

Amazon prefers their individual units be profitable. Losses are a bad habit they discourage almost as much as Empire-wide reportable profits. They generally price their hardware at prevailing rates; like the FireTV STB at $100 and the stick at $39. For all the accusations hurled at them, they rarely rely solely on pricing to win.

Back in the early days they were (falsely) accused of using ebooks as loss leaders for hardware sales and even at the height of the Nook challenge (circa 2011-12) nobody was able to prove they sold the readers below cost. Most cost estimation breakdowns showed a $5 profit on the ad-supported model. And those estimates probably underestimated their volume discounts on the eink screens. (At that time Amazon consumed over 50% of the eink screens coming out of the factory. Which is how they got dibs on Pearl screen production for a year.)

One thing people forget is Amazon is bringing a billion a year in ad revenue which is a business they built-up with the eink readers. Lots of ways to profit that don't show up on the short-term balance sheet.

[eschwartz]

Originally Posted by Rizla

Are you saying we see less e-ink innovation in the USA market because of Amazon's dominance?

No, even if there were 20 different companies that each had 5% of the market, a combination of DRM and peoples' natural inclination means most people will tend to buy most of their ebooks from the integrated store.

And once you are locked into a store, it is too annoying for the average consumer to switch. Ever.
It's more than annoying enough for the unnatural consumer here on MR. But thank G-d for calibre and Alf.

It doesn't really matter who dominates, as long as someone does there isn't much call for innovation.
DRM, and the death of the small ebookstore, destroyed the ability for innovation to flourish.