Are we going to see any new eReader companies in 2011?

The Kindle, the Nook, and the Sony Reader are the Big 3 eReaders in the US.

It’s surprising that Amazon, B&N, and Sony are the only big companies selling eReaders in the US. For a market where the #1 eReader is supposedly selling 8 million units a year, there’s a surprising lack of competition.

Will that change in 2011? Are we going to see any new eReader companies enter the market?

Well, let’s list out the usual and unusual suspects, and see which, if any, are likely to release an eReader in the US in 2011.

Companies that might release an eReader in 2011

As it turns out, there are a surprisingly large number of companies that might enter the eReader market. Perhaps Amazon is right to hide Kindle sales figures.

Google – A Google eReader is inevitable

This is a company that’s buying its own fiber, bidding for wireless spectrum, building undersea cables, releasing its own phones, and releasing its own laptops. Any market that seems worth a shot seems to get an offering from Google.

Add on the fact that books are one of the few markets where Google has shown a very un-Google like focus – It’s digitized millions of books, been in and out of Court more than O.J., and launched both Google Books and Google eBooks. If a company like Google, that tends to kill off most product experiments in a few years, has stuck with books for this long, there’s a very high chance it’ll go all-out and build an eReader. 

It’s almost inevitable that Google releases its own eReader. At worst, it’ll get HTC or Sony to release an eReader for it. It might try to buy Sony’s eReader division – Perhaps it even attempts to buy Nook and Kobo.

A Google eReader is inevitable – We just don’t know whether it’s going to release one itself, have HTC release one for it, or buy the eReader divisions of one or more of Sony, B&N, and Kobo.

Apple – Steve Jobs might decide that he wants tens of millions of eReader sales a year

Killing off the Kindle, or at least slowing it down, is strategically very important for Apple.

Amazon causes problems – it got rid of DRM in mp3 files and forced Apple to match, it sells digital games and digital movies and books (direct competition with iTunes), and it’s even threatening to make its own Android Store and Tablet.

Steve Jobs might decide he wants to cut off the threat before it grows too big, and might release a dedicated reading device. It would probably be closer to Nook Color than to Kindle, but it would be a device dedicated to reading.

Of course, you could argue that an Apple iReader isn’t going to kill the Kindle. It might, however, slow it down.

Is the eReader market big enough for Microsoft?

If the threshold for Apple is tens of millions of units sold per year, for Microsoft its 50 million units sold per year.

It’s highly unlikely the eReader market will be big enough in 2011 to draw more than a few cursory glances from the biggest tech company in Seattle. It is worth noting that it has a lot of the elements in place already – its Research division has shown off ePaper, it  has a decent Cloud Computing offering, it has done some book digitization work, and it won’t have a problem with software.

This might be the company Amazon is most afraid of. You have to look at the ridiculous amounts invested into Xbox and Search – Would Amazon really want to take on a company that is willing to lose a billion or more dollars a year to win over a market? A company that is willing to keep losing billions of dollars year after year until it finally wins?

Qualcomm – Why does it have a 3-screen reading tablet patent?

Last year Qualcomm got a patent for a 3 screen device that contorts into various things – movie player, tablet, book reader. Combine that with the hottest ePaper technology, Mirasol color ePaper, and you have the makings of a very decent reading tablet.

The question is – Would Qualcomm prefer to sell Mirasol screens, or would it prefer to sell Mirasol screens and also its own eReader?

It is the largest fabless chip supplier in the world, has total assets of around $30 billion, and makes around $3 billion a year in profits (courtesy Wikipedia).

It’s also invested $2 billion into a Mirasol screen production facility, and claims to have won a major eReader client. If it decides to make an eReader of its own, it could definitely shake things up.

Samsung – Will Samsung bring its eReaders to the US?

Samsung is selling a pretty decent, albeit expensive, eReader in the UK and Europe. It also has another eReader in the works.

Will it bring one or both of these to the US?

Samsung had $117 billion in revenue in 2009, with $8.33 billion in profit. It isn’t exactly the type of company you want jumping into your market.

It’s already shown it isn’t scared of challenging a market leader by releasing the Samsung Galaxy Tab to take on the iPad. It’s sold over a million of those. Samsung’s also got the #1 spot in TVs, and the #2 spot in smartphones. It’s interesting how Samsung isn’t on anyone’s radar.

Hitachi – Is Hitachi’s ePaper ready for an eReader?

Hitachi is another company that is on no one’s radar. It makes TVs and camcorders and computer hard drives. What’s interesting is that it’s working on ePaper. Given its focus on electronics, it wouldn’t be a stretch to imagine that if it succeeds in its ePaper endeavors, it’ll move on to making eReaders.

Hitachi has $95 billion in assets, had revenue of around $96 billion in 2010, and profits of $1.145 billion (which is quite close to Amazon’s $902 million profit in 2009).

It’s shown solid intent by working on ePaper – While it’s unlikely it’ll be ready to release an eReader in 2011, it might eventually play a part in the eReader wars.

Toshiba Biblio Leaf Solar-powered eReader set to arrive in 2011

Toshiba was supposed to launch its solar-powered Biblio Lead eReader in Japan on Christmas. There’s a chance it makes it to the US in 2011 itself.

Toshiba had $19.7 billion in profits in 2010. That’s almost as much profit as total 2009 revenue for Google ($23.65 billion, $6.5 billion profit) and Amazon ($24.5 billion, $902 million profit).

If their eReaders are as good as their laptops, Toshiba will be a dangerous, dangerous competitor.

Fujitsu – Will the Fujitsu Color eReader make it to the US?

Fujitsu has released two generations of its FLEPia color eReader in Japan. Nothing in the US.

It’s quite likely that Fujitsu will make its way to the US. Its first generation color eReader was a large screen one for over $1,000 – However, you have to imagine it’s figured out how to cut costs, and it might be the first company to bring a reasonably priced color eReader to market.

Fujitsu is a pretty big company – $32 billion in assets, $46 billion in revenue, and $824 million in profits for 2009.

Sharp’s Galapagos Reading Tablet reaches US in 2011

Sharp has already released its Reading Tablet in Japan, and promises to bring it to the US soon. There’s a 5.5″ variant and a 10.8″ variant – both use LCD screens.

This list of Global Tech Companies with the Highest Revenue at Wikipedia is fascinating, and Sharp is at the 18th spot – right between Intel and Motorola. We’re talking about $34 billion in assets and $33.6 billion in revenue in 2010.

Sharp makes everything from TVs to smartphones – it’ll have a lot of experience to draw on as it fights in the eReader wars.

Asus should be releasing its eReaders in the US in 2011

Asus made a lot of noise at CES 2010, and then changed its plan of introducing two low-priced eReaders in early 2010. It finally started shipping the Asus DR900 eReader in December. Not sure when it gets to the US.

The Asus DR900 has a 9″ screen, and would end up being one of the few Kindle DX competitors. Asus also has a smaller eReader in its lineup.

Asus has been having a bit of a rough patch as the netbook market has stalled. However, it’s still a monster – $21.2 billion in revenue in 2009 and $520 million in profits. It’s also very good at cutting costs, and isn’t the type of company you want to be competing with very often.

Acer Lumiread set to arrive in 2011

Acer talked about its eReader plans in early 2010, then said it’s backing off, and now is saying it’ll be releasing the Acer Lumiread eReader soon. The Acer Lumiread has already reached the FCC – hopefully we’ll be seeing it in early 2011.

Acer itself is a solid company – $17.9 billion in revenue in 2009, with $384 million in profits. It’s also the second biggest notebook manufacturer in the world (unconfirmed).

Additionally, it stole the netbook market from Asus – So it has some experience of dethroning a market leader.

A lot more new eReader Possibilities than expected

Have to say it’s a little surprising to find out that so many tech giants, from all over the world, are looking to release their eReaders in the US in 2011.

We started with Google, Apple, and Microsoft – but they are all a bit unlikely to actually produce and release a dedicated eReader in 2011.

A lot of the remaining companies, however, are very solid bets. These are companies that already have eReaders in production, in most cases have an eReader out in another country, and are very likely to actually release eReaders in the US in 2011.

It’s a surprise that there are so many of them (at least 6 sure bets), and it’s a surprise that they have such rich pedigree.

eReaders are already a hot market – It doesn’t matter whether Amazon and B&N hide sales figures or not

If you look at the Wikipedia link above (Top Global Tech Companies by revenue), you realize something startling -

  1. Samsung, which is 1st on the list with $117 billion in 2009 revenue, is releasing an eReader in the US soon. Samsung’s E6 eReader is already out in Europe.
  2. Hitachi, which is 3rd on the list with $99 billion in 2009 revenue, has an ePaper product, and might have an eReader in the works. 
  3. Sony, which is 5th on the list with $79 billion in 2009 revenue, started the whole eReader fire. It’s continued to invest in eReaders.
  4. Toshiba, which is 6th on the list with $76 billion revenue in 2009, has its Toshiba Biblio eReader out in Japan. It’s promised to bring its eReader to the US soon.
  5. Fujitsu, which is 12th on the list with $46 billion in revenue in 2009, has had a color eReader out in Japan since 2008.
  6. Apple, which is 14th on the list with $42.9 billion in revenue (please note that its 2010 revenue is around $65 billion), already has the iPad out and is attacking the eReader market with it. There’s talk that the iPad 2 will focus on reading and will include a screen that minimizes glare.
  7. Sharp, which is 18th on the list with $33.6 billion in revenue in 2009, has a reading tablet out in Japan, and is bringing its reading tablet to the US in 2011. 
  8. Google, which is 23rd on the list with $22 billion in revenue in 2009 and $6.5 billion in profit, might be working on an eReader. It’s already jumped into ebooks.
  9. Asus, which is 24th on the list with $21 billion in revenue in 2009, has a large screen eReader arriving in Taiwan very soon. Asus delayed its US release after the iPad came out, but might bring its eReaders to the US in 2011.
  10. Acer, which is 25th on the list with $17.9 billion in revenue in 2009, has the Acer Lumiread eReader. It should be out in 2011.

7 out of the 25 highest revenue tech companies in the world already have eReaders. Only 1 of those is currently available in the US – the other 6 will almost certainly arrive in 2011.

Another 3 companies (Hitachi, Apple, Google) might jump in with an eReader or a reading tablet. Apple has been trying to pass off the iPad as an eReader all through 2010, and will probably paint the iPad 2 as an eReader all through 2011.

2010 was the Year of the eReader. 2011 might be the Year of the eReader Wars.

Not sure which competitor Amazon is fooling by not releasing sales numbers. You can bet it’s costing Samsung, Asus, and all the other companies on the list just a few thousand dollars to send recon workers into Foxconn, and get full details on how many Kindles and Nooks are being produced, shipped, and sold.

3 Responses

  1. I’m dubious about there being many new entrants, except Google, for five reasons:

    1. The US & UK markets are, IMO, profitless at current price levels. B&N and Borders are in desperate straits and have made a desperation move to try to stay alive by cutting their prices to the bone.

    2. Without the direct access to customers provided by the stores of Amazon, B&N, and Borders, a device-maker must share his revenue with a middleman, raising the price it must charge.

    3. Without a bookstore, a COMPETITIVE store, an EBR can’t get much traction.

    4. It takes years to develop a sophisticated and robust software system, including the tricky coordination needed with the home base (store). They’ll be flailing until they do.

    5. It’s hard to imagine the current crop of EBRs being technologically leapfrogged at an attractive price level in 2011.

    I think these dark horse companies might do well in Japan, and possibly in China or India, if they can somehow get government backing / collaboration / purchasing contracts for school systems. From that base they might begin to put the pieces in place for an assault on the US & UK markets. MIGHT.

  2. Well, I have to say that Samsung, Acer and Asus ereaders have proved to be a big failure, here in Europe. Samsung and Acer didn’t sell at all, and Asus ereader is demonstrating to be a real bad device: almost everybody who bought it is now complaining.
    I am positively sure that all of three companies will withdraw from ereader market soon.

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