The original Kindle: A flawed consumer device, saved by ubiquitous connectivity

The blogosphere today is abuzz about the New York Times article claiming that New big-screen eBook readers may help save the newspaper business. Techcrunch claims it is a hopeless search for a non-existent lifeline for the news, not the paper business. ZDNet claims that it really is a Trojan Horse to tackle the margin-rich textbook business. Wow, I had no idea. Next time you see a college textbook mogul let me know.

I own an original Kindle. Its ergonomic flaws have been documented by many, including the too-large next and previous page buttons, the lack of a place to hold the device, and the poor fit and finish of the device itself. Compared with its main competitor, the Sony Reader Digital Book, the original Kindle feels cheap and poorly designed.

But regardless of its drawbacks, I use my Kindle quite a bit and promote it as a worthwhile consumer device in my Anywhere presentations. Why? Because connectivity is its killer app. I typically describe as “a flawed consumer device saved by ubiquitous connectivity.”

Let me explain.

We’ve all found ourselves in this situation: we’re about to board a cross-country flight, and we want something to read other than the 50 pulp titles in the airport book store. Pre-Kindle, you were stuck. With a Kindle in hand, you can choose from more than 200,000 books from Amazon, and if that’s not enough for you, Google, Feedbooks.com, and others will be happy to load you up with classic free books in the time it takes you to board your plane. The Kindle doesn’t replace reading a real book if you have one; rather it lets you buy a book you want to read when you DON’T have one.

So what does this have to do with a possible large screen Kindle? I don’t think Amazon is trying to save the New York Times per se; I think they are simply iterating on their Kindle concept for different uses and customers. Without any inside knowledge of what Amazon will announce on Wednesday, I suspect that whatever innovations Amazon announces will:

• Continue Amazon’s “media store in a box” business model. With the Kindle tied to Amazon.com, Amazon is giving readers a friction-free shopping experience at one of the largest media stores on the planet. With the Kindle’s Whispernet (actually Sprint EVDO) delivery, Amazon can nearly instantly gratify any buying impulse—and that’s a winning retail formula.
• Try to do more to mimic real reading experiences. Most of the speculation about this new Amazon event has been around a single large E-Ink screen, but as others have noted, this creates portability problems. However, if Amazon were to try a different design that consisted of two E-Ink screens connected by a hinge, that form factor could provide readers with the side-by-side reading experience they already get with books and newspapers. Think it’s farfetched? Nintendo does exactly that with its DS series of portable gaming devices except the two screens are one above the other; turn it sideways and you’ve got a quite viable two-screen book reader — and it would still fit in a briefcase, unlike a larger single-screen device.
• Not be a subsidized device. Subsidies sound great, until you realize that it would require more than $350 million in capital to provide Kindle 2s to the New York Times one million daily readers, and about 50% more to include the Sunday Times readers, all without any guaranteed increase in revenue. Yes, the Times could put its content behind a pay wall again to boost online and Kindle subscriptions, but overall, this is a money losing proposition unless the Times were to stop printing newspapers entirely. Rather than take this chance, my bet is that the the partnership between Amazon and the Times is more likely to be along the lines of a “Buy a Kindle and get your first three months of the Times free!” promotion rather than “Buy the Times and get a Kindle free.”

You’ll be hearing more about eBook Readers and eBooks from Yankee Group in coming months in Josh Martin’s connected device coverage, my digital media coverage, and from others analyzing the businesses supporting these systems. But at the moment, the eBook Reader market is technology just discovering a viable business model. We shouldn’t be expecting it to be a magic bullet to save the newspaper business from high production and distribution costs — it has neither the profits nor the consumer acceptance to do that yet. But the modest success of Amazon’s Kindle books—and app stores as well, I might add, as our recent report notes—has demonstrated that paid digital media is a good business if you give consumers instant gratification through the killer app of connectivity. And best of all, the ink doesn’t rub off on your hands.