Should Amazon give away Kindles?
I’ve been having a fairly lengthy exchange with S. Hawthorne in the Amazon Kindle community:
The proposal that started it was this:
Amazon gives people Kindles…and a few free downloads. In exchange, the person agrees to buy three books in the next year.
I don’t see it.
I have seen people projecting that Kindles would be free this year or next…and that appears to me to have started with John Walkenbach in this
That prediction came in October 2009, and figured that Kindles would be free by this June (2011).
It was only based on three data points though…prices of the K2.
I find using that data a little arbitrary…why not continue projecting and say Amazon will eventually be paying us two hundred dollars to take a Kindle…or a million dollars, if you keep going?
That doesn’t make sense, right? Amazon would be losing money if they paid us a million bucks to accept their gift of a Kindle.
I ran a few more numbers:
|7/28/2010||Kindle 3 wifi only||139|
Looking at that, the average number of days between price drops is 164.
The average price drop (when there was one, and not including the wi-fi only, which to me is a different device) is $52.50.
So, if we took four more price drops of $52.50 (to get $189 to zero) at 164 days apart, a Kindle would be free by May 14, 2012.
I don’t see that simple progression happening…the price changes have been driven by the introduction of a new model, for one thing…and I’m not sure the pace of new models will stay the same. I do think there may be an Amazon tablet soon, but I would consider that not a Kindle (unless they chose to call it that). Even so, I think it would delay the introduction of another Kindle.
I could see Amazon giving a Kindle to Prime members (most of whom pay $79 a year for a deal on shipping). Amazon wants us to rely on them for pretty much everything (is health care in their future? ;) ), and Prime members are pretty tied into the system. They get all kinds of things from Amazon.
That’s different from just giving it to anybody, though, even if they agree to buy “three books in a year”.
I think people already average a lot more e-book purchases than that from Amazon…without being bribed.
Now, I’ve always believed that first-place companies lose that position not by underestimating their competitors, but by overestimating customer loyalty.
When Sony’s Beta lost to VHS in the USA, I do think part of it was that they didn’t realize they’d have to promote it. I think they figured that their format was better (it was…except it didn’t record long enough for American football games, which was part of the problem), their name was bigger…people would naturally pick them.
I don’t think Amazon is going to do that, though. They are a very innovative business (even if Barnes & Noble has beaten them to a couple of things with E-Book Readers…EBRs), and their three tenets (Service, Selection, and Price) keep them motivated and on their toes.
However, doesn’t it seem like a Book-of-the-Month club type arrangement would be successful?
As I’ve been saying with S. Hawthorne, I don’t see it.
First, book clubs are really built around paper. Why can book clubs give you a lower price?
They use cheaper materials.
That’s not always true, but traditionally, book club editions are smaller and printed on inexpensive paper.
There might also be pluses on delivery.
Neither of those apply to e-books.
Yes, I can see e-book book clubs working…but they are to attract people who don’t already buy 100 books or more a year.
As I’ve mentioned before, I can also see subscription services. You join a science fiction or romance book club, and you are automatically sent books. They might be independents of which you’ve never heard before, but you would get a discount and automatic delivery.
Of course, to get a discount, they pretty much have to be independents. Not quite, but the biggest six US trade publishers are under the Agency Model, meaning Amazon can’t discount the books.
Yes, I think indie publishers could do themed subscriptions.
However, I don’t think Amazon needs to give away Kindles to keep customers.
I know, I know…Barnes & Noble has gotten some marketshare…but that’s because the market is growing so much. Amazon still seems to be increasing sales of the Kindle…at least when they tell us something, it’s usually to tell us it was the best month ever. :)
What do you think? Should Amazon give away Kindles? Will increasing competition force them into new models? Does it matter that Book-of-the-Month club in Canada went into receivership? I told S. Hawthorne I would take a bet that Amazon would still be number one in dedicated E Ink EBRs in a year…I don’t really do bets, but is that overconfident?
Feel free to tell me what you think.
This post by Bufo Calvin originally appeared in the I Love My Kindle blog.