What Amazon could revolutionize on Thursday…and it isn’t hardware

What Amazon could revolutionize on Thursday…and it isn’t hardware

Amazon has a major presser (press conference) scheduled for this Thursday, September 6th, at 10:30 AM Pacific time in Santa Monica.

They’ve invited reporters (including bloggers) from all over.

People are used to that happening for hardware, thanks in part to Apple.

After all, you don’t really need to transport those clunky human bodies thousands of miles unless they are going to hold something in their hands (we can’t quite use a 3D printer to “poof” a tablet into everybody’s hands…yet).

However…

Amazon hasn’t even been selling their own brand of hardware for five years yet. For that matter, have they really been the hardware leader? There were more than ten EBRs (E-Book Readers) in the USA market when the Kindle was introduced. Barnes & Noble was first with a “reader’s tablet”, first with a frontlit reflective screen EBR.

Does anybody really think Amazon is going to out engineer Apple? Microsoft? Samsung, Nokia…keep going.

Amazon has stated three basic principles: service; selection; and price.

When the Kindle was introduced in 2007 at nearly $400, it wasn’t about price.

There were EBRs available at much lower prices.

One of the biggest service elements was the ability to get things wirelessly. Before that, you generally plugged your reader into your computer, and transferred book files to it. While the wireless required hardware, it was the ease of use (service) that transformed the e-book market from maybe half a percent of the USA publishing market to more than ten percent.

Amazon’s reputation also really brought major publishers into the game in a big way…adding to selection.

Amazon contained the prices…comparing popular, bestselling e-book prices at $9.99 made them considerably less expensive than their hardback versions. That, of course, put Amazon and the Agency Model publishers on two sides of a battle.

Then there was text-to-speech…Amazon included it on the Kindle 2, and that created another division with publishers.

However, Amazon is still really good at making content deals with rightsholders. They have a huge number of exclusive e-books…not just with independent publishers who use Amazon’s Kindle Direct Publishing, but with solid backlist titles.

They announce new deals with video rightsholders all the time.

Video…that’s a place ripe for another revolution.

One simple thing would be embracing UltraViolet.

As Ryan Lawler points out in this

TechCrunch article

Santa Monica would be a great place to announce that.

What would it mean?

I looked into this for myself earlier this year.

I’d love to take my DVDs to Walmart and have them convert them to digital files I could access from anywhere!

They have a deal like that…and it’s cheap.

I don’t have the same sentimental attachment to the discs themselves that I have to paperbooks…but they don’t have to destroy the disc to convert it.

The studios agree to it.

It would take very little to make Vudu available on a new tablet.

Lawler also suggests that Amazon could make that deal on DVD purchases you’ve made from them…so you wouldn’t even have to take them anywhere.

Would you pay a dollar a disc? I would, for some videos for sure.

The question becomes, will someone who owns a DVD pay full boat again for a digital version? Some will, obviously. Would tons more pay a small amount who otherwise wouldn’t pay anything?

Yes, I think so.

The opportunity for people to convert their physical media to digital, stored with Amazon, is a huge opportunity. It also really locks you into Amazon…even if playing it is hardware independent (meaning you store it with Amazon, but can play it on a non-Amazon device).

Tie this into a deal for Prime members, and that gets people buying those “diapers and windshield wipers” from Amazon.

Amazon is investing immense amounts of money in physical item delivery (buying a robot company, building fulfillment centers), and that’s not about paperbooks.

It may be worth it for Amazon to pay rightsholders to allow the use of digital versions of their content to get consumers absolute loyalty on non-entertainment purchases.

If it is determined that it is legal for consumers to convert their physical media to digital copies across content types, then services that do it simply make sense. People in the forums have generally laughed at the idea that “you bought it once” means that you should be able to get it in another format…but it could be done through agreements with rightsholders and/or Fair Use interpretations that make it so.

It’s more complex with books, where I think it is more common that the publisher from which you bought the paperbook doesn’t have the e-book rights…but I can see interpretations that make it work, as long as you aren’t distributing it.

While a “paperwhite” display on a frontlit Touch would be interesting, I don’t see that as revolutionary.

Amazon could certainly make news with price, especially with at least one ad-supported model (an Amazon innovation).

I think the big news may be them making it easier to get entertainment items you already own into their ecosystem.

Some other non-hardware items that could create a buzz:

  • Text-to-speech for a tablet*
  • Internationalization of the Fire or its successor
  • Device-specific archives (choose which items are allowed on which devices on your account). Generally, the idea that you can have people on your account with different levels of control…what is often referred to as “parental controls”, but could certainly go for “employer controls” and other configurations
  • Increased social connectivity
  • Cloud, cloud, cloud! Amazon is good at Cloud storage, and moving things there is a strength for them
  • Bonuses for Prime members…that’s the path into the golden valley for Amazon
  • Voice interactivity
  • Display of closed captioning on video
  • Could they allow phone calls on their tablet somehow? Sure…and that’s a game changer
  • A camera would give them some very interesting opportunities in augmented reality

Yes, hardware is interesting…Bluetooth or another ability to host an external physical keyboard for the tablet would mean I would largely replace a laptop/netbook.

Think the big three (service, selection, price)…what do you think Amazon can do with those on Thursday?

Feel free to let me and my readers know your speculations by commenting on this post.

* I use the Pico text-to-speech on my Fire for typically hours a week, but the announcement of a robust TTS that worked with Kindle store books would get noticed

Update: Amazon announced a deal with EPIX after I published this.

http://en.wikipedia.org/wiki/Epix_(TV_channel)

That’s going to bring major movies (like The Hunger Games) to Prime streaming. Roger Knights, one of my regular readers and commenters, tells me that Netflix stock dropped 10%.

They also announced a second deal with NBC Universal for some well-known TV shows for Prime.

They have announced this ahead of Thursday’s presser. I think we may still hear something more innovative in two days and an hour…but who’s counting? ;)

This post by Bufo Calvin originally appeared in the I Love My Kindle blog.

About these ads

12 Responses to “What Amazon could revolutionize on Thursday…and it isn’t hardware”

  1. rogerknights Says:

    “Bonuses for Prime members…that’s the path into the golden valley for Amazon.”

    On target! Amazon has just announced a deal with Epix for the rights for thousands more top movies for Prime viewers. It’s causing a buzz–and a 10% drop in Netflix stock today. Here’s the link: http://www.bloomberg.com/news/2012-09-04/amazon-rivals-netflix-in-epix-deal-adding-movies-to-prime.html

    “Yes, hardware is interesting…Bluetooth or another ability to host an external physical keyboard for the tablet would mean I would largely replace a laptop/netbook.”

    And a USB port!
    And a double-sided RSK/LCD device!
    Combined with a smartphone!
    Combined with a backscratcher and potato-peeler!
    That would be a (virtual) “doorbuster”!

    • Bufo Calvin Says:

      Thanks for writing, Roger!

      Yep! I saw that press release after I’d published my piece. They are announcing that ahead of the presser, though…I think it needs to be more of a breakthrough announcement on Thursday.

      I think a double-sided device is some ways off…I don’t expect that Thursday, personally.

      A USB port that can host a keyboard or other devices…I think that’s possible. The negative is battery consumption and less control over the use of the device.

      The SmartPhone equivalent could be done…again, powering the USB port would enable a microphone, and then you are Skype-worthy. Add a camera, and you can be Tango-ready.

      • rogerknights Says:

        Well, I’ll be happy with Bluetooth, if USB is unrealistic, as it probably is. Maybe it’ll have side-by-side screens. That would be less adventurous–and would fit with a leak/rumor of a year ago that Andrys reported on.

        I guess I’m unexcited by “deals” involving Prime, because I don’t care about speedy delivery and I don’t order enough to make it worthwhile for me–plus I don’t watch movies much. However, if this release is mostly about deals, it would be appropriate if Amazon re-branded their gadget as the Kindeal, the name I suggested when the first ad-supported version came out. (The name is free, as are all my Kindle-Improvement Suggestions.)

        If this version is sufficiently ad-heavy, maybe it’ll be free with a 2-year (say) commitment to Prime–as others have suggested.

      • Jj Hitt Says:

        The problem with a USB port is that USB isn’t peer-to-peer. The standard allows something to be either a device or a host. The Kindle already acts as a device when connected to a computer. The only exception being hubs (which are viewed as being part of the host).

        Not physically or technically impossible, but it wouldn’t be standard compliant and very likely to be glitchy (plus create a number of licensing and warranty headaches).

  2. Bruce K Says:

    I think the Epix thing is big, but as you imply, there could be more.

    I’ve always felt Amazon should leverage the “bundling” aspect more. Am I the only person in the world that would buy a book bundled with the Audible version at a discount? Even better if they could sync – at least – chapter placing – between the two. How about listening while reading (like Text-To-Speech is currently)

    Audible is a great service, yet still sort of the step-child of the services umbrella. There is still no native iPad app (iPhone enlarged). But its awesome on Kindles including Kindle Fire.

    Recently, I’ve purchased a BluRay disc and received an Amazon instant video credit for a rental?!? Worse, the rental is typically not HD.

    I’ve always felt Amazon could bundle Instant Video with DVD/BluRay purchases for a bundle price. Would they even need studio approval to add Instant Video access at a discounted price?

    Your analysis is dead on. They are not a hardware innovation company. But they bring innovation to their services, that really shine on their hardware.

    P.S. – I would love device specific controls/pseudo sub-accounts/collections. WOW!

    • Bruce K Says:

      Called it. “Imersion Reading” and “Whispersync”
      Synchronized reading and listening. Way to go Amazon for leveraging these two great assets!

  3. Bruce K Says:

    One more thing . . .

    My experience with Ultraviolet leaves alot to be desired. In my short experience, I have 8 UV movies. But setting up accounts and access is crazy confusing. I have accounts on WarnerBros, Universal, Paramount, Flixter and Ultraviolet.

    And the studios are not of one mind.

    If Amazon could improve on this, it would be huge.
    Thats what was so amazing about what Apple did. However,
    - Apple movies are not coming to Kindle.
    - Studios don’t want to give Apple their cut.

  4. Lona Jennings Says:

    I have been in a rage with Amazon for quite some time regarding non-captioning of Instant Video. I have had a couple of conversations with service people lately about captioning to no avail. There is an FCC ruling that takes affect early next year requiring captioning of some video. If Amazon starts captioning as part of this update I would be ecstatic.

    • Bufo Calvin Says:

      Thanks for writing, Lona!

      Does that ruling affect hardware?

      What I’ve written about

      http://ilmk.wordpress.com/2012/05/31/round-up-86-closed-captioning-aztec-mummies-japan/

      is the

      Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA)

      which, starting July 15th of this year, required some significant streaming video to be closed captioned.

      However, my understanding is that it doesn’t require devices to carry the decoding software.

      In other words, Prime Instant Video (that was previously broadcast in the USA) is required to have closed captioning, but the now sold out Kindle Fire wasn’t required to be able to display it.

      Does that match up with what you know?

      Amazon has led on some accessibility issues, and I’d love to see them lead on this on Thursday.

  5. Edward Boyhan Says:

    I’ve been thinking and speculating about this for about a month now. My thoughts fall into 2 buckets: what I think they’re going to announce; and what I hope/wish they will announce.

    I actually don’t think there’s much they can do on the hardware/features front that will wow the market, and beat the Nexus 7 in that regard. That said, I think they will announce two KF-like devices (high probability) — both of these will have 7″ish screens. One will be a slightly improved KF with a reduced price; the other (KF2) will be a new device with a better screen (I’m hoping it’s OLED). There may be other H/W features of note on the KF2, but nothing that IMO will wow the market.

    I think there will be a realignment of the kindle e-ink line with some modest H/W improvements (medium priority). There may be a larger screened Kindle Fire (8.9 or 10.1″ screen — low probability); and there may be a smartphone announcement (very low probability).

    So “Where’s the Beef” :D? In a word: price. I would not be surprised to see a repriced/rebranded KF at $129; and the KF2 will have to undercut the Nexus in order to be minimally competitive (I’m guessing $179 or $189). The big bet I’m making is that there will be an entry level e-ink kindle at $49 (ad supported).

    As to what I hope/wish for: other than an OLED display everything I’m hoping for falls into the S/W realm, and most of that on the Amazon Kindle web site side of things. I’d like quite a bit of improvement in the management of single account/ multiple kindle devices — including some kind of universal collections facility, and a “sub-account” notion where differing collection and parental control patterns could be applied. I’d also like some unification of their 3 cloud storage facilities: archive, Amazon Cloud Drive, and Personal Documents Service. I especially would like an easy way to get media (books, movies, music) stored on Amazon Cloud DRive onto a kindle (currently only music can easily do this via the Amazon Cloud Player).

    Lastly, I’d like them to do something in the personal library management area. At a minimum I’d like to see them unify the “manage my kindle”, “your media library”, “kindle.amazon.com”, and Shelfari sites into one “useful” Amazon/Non-Amazon media library management system.

  6. rogerknights Says:

    Built-in digital voice recorder? All it would take is software, plus an (extra cost) mike.

  7. Round up #116: Librarians’ letter to publishers, NOOK video « I Love My Kindle Says:

    [...] are also beating Amazon to UltraViolet (at least in the announcement), something I suggested Amazon might do at their September 4th presser (press [...]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


Follow

Get every new post delivered to your Inbox.

Join 1,251 other followers

%d bloggers like this: