Kindle Review – Kindle Fire Review, Kindle 4 Review

Michael Yoshikami has a Kindle article at CNBC that is the exact opposite of CNBC’s ‘Kindle is positively passe’ article from yesterday.

 Here’s the first good snippet -

it makes one wonder if Amazon’s move into digital books will end up being crushed by the Apple Job juggernaut. I suppose it depends on what business you believe Amazon is in. Perspective matters.

What Business exactly is Amazon in?

Well, let’s consider -

1. There’s obviously retail. With physical books, music, and movies playing a big part.  
2. They own top retail websites in numerous countries.
3. There’s Amazon Wireless where they sell cellphones and subscriptions.
4. In digital music they are a top 3 player. They are also branching into movie and TV downloads.
5. There’s the Kindle.
6. There’s the Kindle Store.
7. They bought Zappos and also own Endless.com so we have shoes and clothes.
8. There’s Amazon Fresh.
9. Perhaps they are a Cloud Company. After all they do have the lead in the Cloud Services market.
10. On the other hand they might be in the websites business – They do own IMDB.com and a lot of other properties.

There are so many other things you could point to – Alexa, Drugstore.com, Pets.com.

The press and analysts tend to associate Amazon’s future with the future of the Kindle device. That’s amazingly myopic - You have a company that is taking over all of retail. Even in emerging businesses its early lead in the Cloud is much more valuable than the Kindle.

How could you equate Amazon’s future to that of one of its dozen or so potential billion dollar businesses?

Our first takeaway is that Kindle is just one of many businesses Amazon is in. Let’s go back to Mr. Yoshikami’s article because it has some intelligent things to say.

Amazon’s Kindle Store and Kindle Apps as a content eco-system

Yoshikami points out that the growth of the iPad might be helping Amazon’s ebooks business and not killing it -

if the view is that Amazon is in the digital content space, then iPad will not become a killing threat to Amazon and its digital book business. In fact, one of the most popular applications for the iPad as of today is the Kindle reader.

And that Amazon is expanding its Kindle eco-system to lots of devices -

Kindle books will be available on Macs, PCs, and virtually all smartphones. As a first entrant into the e-reader market, Amazon is clearly the leader in content and is compelling consumers to stay with their format to avoid the need to buy new material for new devices.

Basically, Amazon is building a very strong Kindle eco-system with lots of channels. Even if the Kindle device were to die out Amazon would have lots of channels selling Kindle books.

That’s our second takeaway. Amazon doesn’t need to win both the eReader War and the eBook War. One would be enough.  If it wins the eReader war it automatically wins the ebook war. If all it wins are the ebook wars then it’ll be pretty happy as it’s managed to keep its revenues from book sales.

However, why exactly are we assuming the Kindle eReader will die out?

There’s no good rationale for assuming the Kindle device will die out

From the CNBC article -

The iPad is designed for internet browsing and running applications, whereas the Kindle is best suited for reading text. As such, demand for the Kindle could hold up over time as the best way to read digital books.

That’s a very simple concept – That whatever device provides ‘the best way to read digital books’ will survive. It also has a lot of merit to it. We haven’t seen books and reading die out - Books are still a $23.8 billion a year business.

For some reason people are assuming all these people will prefer a device that ‘also reads’ to a device that is optimized for reading. It’s a rather big assumption to make and one that makes little sense when you track the priorities and actual behavior of readers.

Our third takeaway is that predictions of the Kindle’s death are just that – predictions. They also happen to be very irrational, emotion driven predictions. Do we ever see any strong analysis or cold hard facts to back-up claims of the Kindle’s demise?

No.

It’s either warped logic (people who love to read and want a device to read on would want a device that does more than just read) or its surveys of 250 people who all miraculously turn out to be Kindle owners selling their Kindles to buy Swiss Army Knives.

A world with both Kindle and iPad

What’s changed since the iPhone and talk of it killing the Kindle? Well, now the Kindle killer is bigger, harder to hold, priced at $500 and above, and has no known critical use case.

If 50 million iPhones that people carry with them everywhere didn’t kill the Kindle how are 3 million iPads going to pull off the trick?

Don’t have a clue and neither does anyone else. It just sounds good to call the iPad a kindle killer.

The much likelier possibility is that dedicated readers buy dedicated eReaders like the Kindle and all the people who can’t stand buying a device spoiled by its focus on reading buy iWhatevers. The two target markets are very, very different.

Mr. Yoshikami hits the nail on the head -

So as usual when you read headlines look below the surface and ask what business results might follow. Apple and Amazon can both be successful for different reasons and their business profits are not necessarily a zero sum game; both companies can compete and succeed. There’s enough pie for both of these two media/technology giants

Everyone is operating off of assumptions and personal tastes. They’re not really looking at the facts and they aren’t applying even basic logic or analysis.

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