How the Amazon/Overdrive Partnership Changes the Economics of the Kindle

I have blogged in the past (here and here) about my frustration with digital books and the Kindle.  It is a great device, but I have always struggled with the economics of the platform.  This is especially telling when compared to the option of borrowing books from the library which the Kindle has never supported…until now.

Amazon has announced they have inked a relationship with Overdrive, the company that provides eBook lending services to many libraries including mine.  I believe that this is a major accomplishment since it brings Amazon’s class leading eBook reader into the traditional library realm. Continue reading How the Amazon/Overdrive Partnership Changes the Economics of the Kindle

Amazon cuts Kindle price – 3 reasons why it does not matter

Amazon recently reduced the price of the its Kindle eBook reader to $189 from $259.  This is a substantial discount, but does it matter?  Personally, I am not convinced about the benefits of the Kindle or equivalent eBook readers.  Here is why:


I am frustrated with the strict Digital Rights Management (DRM) inherent in the Kindle and other similar platforms.  I believe that protecting intellectual property is critical, but today’s DRM solutions are very limiting and are designed around the needs of the publisher not the consumer.  The problem is that there is no universally adopted DRM standard.  The Kindle’s DRM is different from Barnes and Nobles’ Nook which is different from Apple’s iBookstore.  The result is a confusing range of formats and options with limited or no interoperability.  Books purchased from Amazon will not run natively on Barnes and Nobles’ Nook or Apple’s iPad.  Amazon has tried to address this by making Kindle applications available for a number of platforms, but it still can be a challenge if you prefer an alternative platform.  As we all know, technology changes rapidly and as eReaders proliferate, there is no guarantee that your Amazon (or Barnes and Noble or iBookstore) content will work on future platforms.  This is very different from the traditional book model where you get perpetual license to a physical book and are guaranteed access to the content. Continue reading Amazon cuts Kindle price – 3 reasons why it does not matter

eBooks — Back Again

I ran across this article on slashdot. It is an interesting review and commentary on Sony’s new eBook. One cool element of the solution is that it includes a new display from eink which uses technology from my alma mater, MIT.

Believe it or not, I have past experience with eBooks because I think that I was one of the five people who purchased an eBook in the previous generation. I was given a Rocket eBook as a gift. Truthfully, I never used it too much.

The business model of eBook providers always infruriated me. I can understand paying a premium for the hardware, but cannot understand how you can possible justify selling electronic books at the same price or more than the physical book. The article says, “Some [books], like “Freakonomics,” are priced like hardcover editions ($16); others, like “The Devil Wears Prada,” are priced like the paperbacks ($8).” I have a a major problem with this.

The cost for an eBook is effectively zero. (e.g. there is nothing that needs to be printed or shipped etc…) Of course, there are other costs such as royalties. Regardless, the cost of an eBook is definitely less than a physical copy. The other issue is that eBook technology is constantly changing and so an eBook purchased today may not be readable in the future, and while you may own the eBook perpetually, you may not be able to read it. Compare this to physical books; I still have books from elementary school!

There are other areas where physical books outperform eBooks:

  1. Physical books are more reliable (no need for power, unaffected by sand, dirt and others.)
  2. Physical books are widely available
  3. You can legally borrow physical books (from the library)
  4. You never have to worry about physical book compatibility
  5. All titles are available as physical books

The net result is that IMO, eBooks are not a compelling value. They only way they potentially make sense are if they are priced at a discount compared to physical books. If prices continue as they are, I do not see how some can possibly justify investing in an eBook.