Re: Re: future of the Amazon Kindle

Joseph Harris writes:
> On the question of business decision making I would be surprised 
> if there were not a projected loss of at least $250m for 5 
> years - for a company of Amazon's size that is a chicken-feed sum 
> if it  sees potential for a big market, and a big share of that 
> market, later.

Absolutely!

> Any repeat publishing venture, such as magazines, that wants to 
> enter a large existing market normally projects 18 months to two 
> years to reach break even.   The kindle venture has interesting 
> parallels.

Here, I think a bit differently.  The Kindle is not centrally about
publishing.  It's about putting an Amazon-bound point-of-sale terminal
in the consumer's pocket or purse, making it very easy to buy books,
but also floor wax, chainsaws, and underwear.  And making it just big
enough to preclude another merchant from also occupying that space.
I'm guessing that Amazon will spend relentlessly to make this a
success, and continue to improve it over the years.

The fact that it includes an ebook reader is nice, and gives it an
ostensible purpose that fits in with one of Amazon's key markets, but
is not essential.  My guess is that the E-Ink screen is there mainly
to conserve power so that the always-on radio doesn't run down the
batteries too quickly.

The key question is whether they can actually close the deal with the
consumer without making the Kindle a full-fledged Web tablet.  Apple,
which is doing something similar with the iPhone, has concluded that
it can't.  But adding a full-fledged Web browser would open up Amazon
to competition much more than it does Apple.  In this respect, the use
of a slow-changing E-Ink screen, relatively poor for Web browsing,
gives them an excuse to make their browser component poor as well.
Not sure how long that strategy will succeed.

Bill

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