Kindle vs Nook twist. A world with just Nook WiFi and Nook Color?

The Kindle 3 might be losing its biggest competitor – or perhaps it will soon face a newer, updated version of it.

There is a rumor that -

  1. Nook 3G production is being stopped.
  2. Nook 3G sales will only continue until current stock is exhausted.
  3. B&N is encouraging retail partners to not take bulk orders for Nook 3G.
  4. Demand for Nook WiFi is/was much higher than for Nook 3G.
  5. There might be a Nook 2 with eInk Pearl around the corner.

All these rumors, centered around a dwindling supply of Nook 3G, stem from an unidentified source within B&N itself that Engadget claims to be in bed with. It must be a very confusing relationship, the sort where you have to put Its Complicated as the relationship status, because the source has produced zero actual evidence and seems to have no idea whether a Nook 2 is on the way.

It’s rather interesting news. There are two distinct possibilities here -

  • B&N is going with a $149 Nook WiFi and a $249 Nook Color.
  • B&N is releasing a $189 Nook 2 to take on the Kindle.

It surprises me a little bit but my gut feeling is that the first option might be the better one for B&N.

Why a $149 Nook WiFi and a $249 Nook Color make a lot of sense

A world without Nook 1 wouldn’t be a huge loss.

Nook 3G wasn’t like the Kindle 3G – It didn’t have free Internet bundled in, and it didn’t have a ton of add-on features like popular highlights. 3G adds on a lot of costs – Amazon is, after all, subsidizing the free Internet and the 3G book downloads.

With a Nook WiFi, users are providing the WiFi or using free WiFi. Which means no download charges for B&N to contend with.

If B&N is seeing 3 Nook WiFis sold for every Nook 3G sold, then it might as well switch over to Nook WiFis completely. Plus we avoid all the confusion by having just one model – consider all the people in analysis paralysis over the Kindle 3G vs Kindle WiFi decision.

Nook Color makes a huge difference

The value for money Nook Color provides is incredible. Was just reading The City and the City on it, and it is so much better than iPad for reading it is not even funny.

Kindle 3 is a good prospect if you do not like LCDs or want the new eInk Pearl or the free 3G. However, Kindle WiFi and Nook Color are the value-for-money champions. With Nook 1 you get neither the new eInk Pearl screen nor the free Internet browsing. It just doesn’t compare that well to Kindle 3.

Nook WiFi at $149 is identical to Nook 3G. Most users were probably choosing it. On top of that you have the fact that 3G support was probably costing B&N a lot.

Finally, by leaving out the Nook 3G entirely, B&N can shift the Kindle vs Nook comparison to Kindle 3 vs Nook Color – a comparison in which it has several advantages such as touch and color and newness.

The downsides

There are obvious downsides to disbanding the Nook 3G.

Firstly, the Kindle 3 no longer has any credible eInk based competitors. Secondly, B&N no longer has a high-end eInk eReader. Thirdly, a lot of people love 3G for the convenience.

Basically, switching to WiFi-only Nooks reduces convenience for customers and at the same time it makes things easier and less costly for B&N. A difficult exchange to pull off successfully.

B&N would take a big risk by having no Kindle 3 competitor in its arsenal.

It makes you wonder if perhaps the real reason the Nook 1 is being discontinued is that Nook 2 is ready.

Why a Nook 2 would also be a good idea

B&N would be able to compete much more effectively with the Kindle 3 if it produced a really good Nook 2.

If B&N were to match all the Kindle 3 features, while keeping 3G and keeping library book support, it would have an eReader as good as, or even slightly better than, the Kindle 3. Amazon would still have the slightly better ebook store – However, Nook 2 would match Kindle 3 on the eReader level.

At that point, B&N could leverage its strengths – foot traffic at its stores, retail partnership with Wal-Mart, library book and ePub support – to make a really strong push.

Who B&N loses if it discontinues Nook 3G

It would be customers who – wanted an eInk screen, wanted 3G in their eReader, did not mind paying $50 extra for 3G, did not mind paying $199 for an eReader.

A lot of those customers probably prefer Kindle 3 – it has the new eInk Pearl screen, it has free Internet browsing, and it is $10 cheaper.

So, B&N might not really lose that much.

Nook vs Nook WiFi vs Nook Color based on my reading experience with each

Firstly, there is virtually zero difference between Nook and Nook WiFi. By eliminating Nook 3G all that B&N loses is the 3G feature. It is really not a big deal.

Secondly, Nook Color is marvellous. It does what iPad does not – allow decent reading on a LCD screen.

B&N has got to be a bit concerned about not having anything to take on Kindle 3 – However, Amazon should be super concerned about not having anything to take on Nook Color.

If Amazon wants to be optimistic it can simply say – B&N has given up on ever beating the Kindle 3.

If Amazon wants to be pragmatic it needs to consider – Perhaps a Nook 2 is in the works. Perhaps Nook Color is doing so well that B&N feels it does not need a Nook 3G any more.

8 Responses

  1. I thougth Nook 1 could browse the internet with 3G. No?

  2. I personally think the big winner will be the first to have a ‘pearl’ ereader with wifi down at $79. With the mad dash for Android cell phones for low prices, there must be a way to make an ereader retail (with profit) at less than a hundred.

    I’m not a fan of trying to please everyone with the low end product. Not when the low end product is far more expensive than what half of the market is willing to pay for an ereader. (At least per the surveys I’ve browsed.)

    So if there is no Nook 2 vs. K3… I don’t think it is much of a hole in the product offering. B&N (and Amazon) should focus on have a good low cost ereader and then a ‘standout’ high end one. I suspect 75%+ of the market is wifi only.

    Neil

    • Agreed about the $79 ereader. The ereader market will not realize its potential until prices get within what 80% or so of the market is willing to pay.

      I have the Kindle 3G, and for book reading purposes, I hardly ever use the 3G. Also, smartphones are beginning to have wireless hotspot features, meaning that in the future many people may be always carrying around their own wifi hotspot.

  3. Why did you read City and the City on the Nook, not Kindle? The color isn’t in the reading, is it? just in the browsing?

  4. B&N is going to lose tens of thousands of potential buyers because of this move, which makes it strategically (long-term) bad.

    They must be doing this because they need to cut costs. That in turn is going to worry some potential US buyers about B&N’s long-term viability, especially after Borders US goes bust, and cost them more sales.

  5. >>>The value for money Nook Color provides is incredible. Was just reading The City and the City on it, and it is so much better than iPad for reading it is not even funny.

    Huh? What do you mean by this? It’s too ambiguous!

    1) Less weight than iPad?
    2) Smaller than iPad?
    3) Higher dpi screen than iPad?

    Bueller? Bueller?

    • All three.

      The 7″ size is better than Kindle and iPad for reading and holding.
      Weight is more than Kindle but feels alright. Perhaps not if you have weak hands.
      Screen is much higher dpi than iPad – around same as Kindle.

      It’s also focused on reading. It’s very similar to the Kindle in its focus for reading.

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