Amazon today launched the Kindle DX, a new eBook reader with a larger screen than the recently introduced Kindle 2.Â The screen measures 8.5″ x 11″, the size of a sheet of ordinary notebook paper.Â The device retails for $489 and appears initially to be targeted at students and newspaper readers.Â Amazon has concluded deals with a number of textbook publishers as well as several universities including Case Western University, Pace, Princeton, Reed, Darden School at the University of Virginia, and Arizona State University.
The Kindle DX will undoubtedly be revolutionary for students if textbook prices can be lowered enough to compensate for the cost of the device.Â Parents and orthopedists will ultimately thank Amazon as younger children ultimately adopt the device and ditch absurdly heavy backpacks.
The bigger news about the Kindle DX is that it shows that there is still a slim chance that traditional newspapers might avoid extinction if they act quickly and decisively.Â The availability of newspaper content for free on the Internet, the defection of classified advertising to Craig Newmark ‘s brainchild craigslist as well as the increasing use of Google News and Google search by consumers to source news have combined to put newspapers in a dangerous state.Â A number of smaller papers have closed and even giants like the New York Times show signs of weakness.
Large screen eBook readers like the Kindle DX show a possible path to salvation.Â By eliminating the cost of printing and distribution and making the screen large enough to accomodate some advertising, the Kindle DX may persuade readers to subscribe to newspapers again.Â Like the Kindle 2, the Kindle DX has a 3G wireless cell chip in it that allows newspapers and books to be downloaded immediately without connection to a computer.Â The Kindle DX also has a more substantial web browser – presumably to allow the newspaper advertising to be more funtional for advertisers.
The concept is good.Â This reviewer often reads the NY Times on the Kindle 2 long before he ventures to the lobby of his manhattan building to discover which creative new place the delivery company for the Wall Street Journal has deposited the paper.
Amazon is not helping itself with the absurdly high price for the Kindle DX of $489.Â This makes the Kindle DX more expensive than most netbook computers which allow readers to wirelessly read newspapers for free, as well as accomplishing other tasks the Kindle DX cannot do.Â While this is also true of the Kindle 2, the Kindle 2′s size makes it feel more like the replacement for a paperback book.Â Amazon may be able to achieve economies of scale for the Kindle DX simply by pursuing it as a textbook replacement, for which it is better suited at the pricepoint.Â But it will not create a breakthrough for newspapers without a minimum 50% price drop.
Amazon also touted newspaper partnerships which would help subsidize the cost of the device with a long-term subscription.Â This turns out to have been more wishful thinking than substance, as the New York Times announced these subsidies would only be available for rural readers who could not get home delivery.Â Â This is really a missed opportunity for the newspaper industry which should be supporting these new devices in every way possible (free reader with three year subscription, anyone?).Â Instead the New York Times continues on with the stone age marketing techniques that brought us the classic ploy of penetration pricing (offering new subscribers lower prices for a short time), thus assuring that the most loyal readers will be punished with the highest prices.Â The Times business managers should peer from the top floor of their new building over to Sony-BMG and the ruins of the rest of the music industry to understand what happens when an industry fails to adapt its revenue model to technology.
Branding Bottom Line:
Amazon introduces an amazing innovation for the citizens of Monaco.