I remember the day when I got my first watch. It was the diver’s watch that my father handed down to me when I was 6. It was a symbol of independence and an instant grant of bragging rights to my friends. Fast forward 16 years, I saved money that I earned from an internship to buy a semi-expensive dress watch. I loved that watch and wore it every day through my university years.
Fast forward another 14 years to today, my watches sit inside my wardrobe for weeks without being touched. That is the same for most people. While the spirit of reading time is still alive and well, it has long left the metal and plastic shells on our wrist and into our mobile phones.
In late 2007, the CEO of Amazon announced the first Kindle to the world. It was hailed as the ‘iPod of reading’ and it would change the way we read books. The world bought the idea. Two and a half years and 3 updates later, the Kindles became the standard of e-Book readers. Other booksellers and device manufacturers followed suit and offered similar hardware and service. With the Amazon’s model taking the lead, eBook readers were on their way to make history.
But that road took a turn on Jan 2010, when Apple announced the iPad and iBooks. Unlike all eBook readers, the iPad is a generic device. It is built for all types of online contents from webpages to apps, games, videos, podcasts, music and books. The iPad ignited debates on the fate of the Kindles and e-Book readers alike. During the past 5 months, more and more evidences are showing that the future of e-Books readers are turning dim.
First were the price drops. Within the past month, three major eBook reader manufacturers (Amazon, Barnes & Noble and Sony) all dropped the prices of their products. The price of a Kindle dropped by 27%. The just released version of the Nook is 25% cheaper, and it comes with wifi and free wifi access in Barnes and Noble stores. The prices of those 3 eBook readers co-incidentally rest just under half the price of an iPad. In my opinion, those prices are still too expensive for eBook readers to remain attractive. In fact, I think the right price of eBook readers is 0.
Vast majority of people want to read books, not to own and maintain another electronic device. The value of being able to download books over-the-air and carry library of books along have now been marginalized by all the other features and possibilities offered by the iPad. All eBook readers on the market can only reliably compete with the iPad on readability of the display and weight, but those advantages will loose strength or simply overlooked by consumers as the iPad product line improves.
Some have argued that eBook readers, being dedicated devices, offer better reading experiences because they allow users to escape emails and other online distractions. That is a weak argument because people today are comfortable with multi-tasking. The explosive growth in smart phones attests that people are looking for devices that will allow them to do more and carry less. For those who really want un-interrupted reading, the off-switch to data connection on the iPad is only two clicks away. On the flip side of that argument, paying half the price of an iPad and get less than 20% of the feature simply doesn’t make a lot of sense.
Last but not least, the business model behind eBook readers is, and should be about selling books. The common denomination of feature that makes up all of eBook readers on the market today suggest that the hardware is already on the path to commoditization. I predict that before the next version of the iPad is released, manufacturers whose main business is in bookselling will either converge toward iPad to de-risk themselves all together, or give away eBook reader hardware for free and let volume of eBook sales support that channel. Other eBook reader manufacturers that solely profit from hardware will need to take the second option in order to stay in the business.
This tectonic shift under eBook readers is nothing but typical. Convergence of devices, contents and services is the counter-force that pushes back upon the endless gush of new offerings (and their variants) that appear on the market every week. Behind these convergences is the mind of consumers, who vote for the best solution to satisfy their practical and emotional needs every time. It is those needs behind that businesses should seek, not the questions that their offerings can help answer.