Kindle 2 eBook Reader – Is it Bleeding Edge? – A Frugal Take on the Digital Book Reading Device


Amazon released a new version of its eBook Reader, Kindle 2 on 24th of Feb 2009. The original Kindle digital book reader was released late 2007 for $399 and the new device can be preordered for $359. Certainly, the digital book reading device carried a hefty price tag, and Amazon’s logic is that Kindle's digital book titles sell at a discount to the paper book version.

A short FAQ on the Amazon Kindle 2 eBook Reader:

1. What is Kindle 2?

Kindle 2 is a digital book reader… Period.

It is only logical to ponder on the premium asking price, given the sole purpose is to read electronic versions of books. Combination of smart marketing along with heavily touted benefits makes Kindle an indispensable device for a small segment of the population.

2. What are the benefits of Kindle 2 compared to other alternatives such as a regular paper book or your computer LCD screen?
  • The screen used in the Kindle is not backlit and is optimized to lessen eyestrain – at least that is the claim,
  • Additional applications are built onto Kindle 2 allowing for better overall experience compared to reading a paper book – online dictionary, wikipedia lookup, font adjustments, annotations and clipping, and search,
  • Kindle 2 weighs in at just 10.2 ounces and can store thousands of books into its 2GB internal memory – for frequent travelers this is a good alternative to carrying ‘n’ number of books.
3. What are the innovations built into Kindle 2?
  • Whispernet – Amazon’s 3G Wireless offering for Kindle 2 – Amazon has an agreement with Sprint to use their high-speed 3G wireless data network with Amazon absorbing the costs of users accessing the wireless network. This setup allows users to download any book without incurring monthly fees. Further, Kindle 2 can operate without a computer or an Internet connection for most of its functionality.
  • Display – Amazon uses a 6" diagonal E-Ink® electronic paper display, 600 x 800 pixel resolution at 167 ppi, 16-level gray scale which is easier on the eyes in comparison to a computer screen. Absence of backlight lets the display reflect sunlight similar to paper making the reading experience comparable regardless of location. E-Ink is an electronic paper technology common to most eBook readers manufactured by E Ink Corporation – the base technology uses millions of microcapsules that respond to electric field.
  • Digital Content and Copy Protection – Amazon uses proprietary formats (ANZ and ANZ1) that use DRM (Digital Rights Management) technology to tie digital content purchased to “device ids” that are unique to Amazon Kindle accounts. This essentially eliminates the possibility of illegal sharing of digital content (eBooks, Newspapers, etc.).
4. What else is there in Kindle 2?

A collection of peripheral technologies make for the digital book reading experience with Kindle 2. They can be classified into three broad categories:
  • Better reading experience – basic web browsing, mp3 background music, text to voice along with features geared for general purpose as online dictionary, wikipedia lookup, font adjustments, annotations and clipping, and search.
  • DRM based copy protection enforcement mechanisms – Kindle titles come in a proprietary format (ANZ) that has a device ID built-in that is tied to the Kindle account. Associated infrastructure in place provides storage of all digital content on the Amazon Kindle Account and efficient retrieval at any time, and
  • Mechanisms to handle “other” file formats – In addition to the proprietary Kindle format (AZW), Kindle automatically handles Mobipocket (PRC, MOBI), mp3, or plain text content. For other document formats (HTML, DOC, PDF, etc.), Amazon has an email-based service that converts these documents to AZW (DRM less). For Audio books in Audible formats (AA), the copy to Kindle is done via the USB.
Frugal Take:

Given Amazon Kindle eBook Reader sold less than 500,000 units in its first year, it is obvious that Kindle was wedded by a narrow segment of the population, but the expectation is that adoption rates will pick up in the future. The much-publicized discount in Kindle title pricing can be appealing to frugal shoppers. Below is a closer look at this, taking the books in our Amazon.com wish list as examples -


While this case study is in no way scientific or representative of an average person’s experience it is obvious:
  1. Many titles are not available as a digital eBook for Kindle, and
  2. One can almost always get a better price for a used or older copy of the paper book.
However, it is the understated factor that makes Kindle unpalatable for frugal shoppers: Amazon.com has ignored to implement a used copy market for the eBooks – the infrastructure is already in place to enforce DRM based copy protection enforcement mechanism – hence the question begs, why have they not extended it to allow change of ownership of the device id associated with digital content (eBooks) thereby enabling the opportunity to resell them? The fact that Amazon is in business is not an adequate explanation. To be fair, it is an uphill task for Amazon to convince publishers to join the bandwagon. It is also clear that Amazon will have to open the infrastructure up to competition or else the whole ecosystem will be a monopoly. Devoid of such a market place, it is easy to argue that eBooks should sell for a very large discount to their paper counterpart given this lack of resale marketplace. The alternative model of buying a new/used paper copy through Amazon.com, reading it, and then recycling it for a slight discount to the purchase price is a far superior model, especially for frugal shoppers, unless one is into holding on to the books purchased indefinitely…

Proprietary formats are the norm for book readers in the market including Kindle. This is a nuisance for an agreed upon DRM based format shared by all readers would surely be customer friendly.

The “anytime, anywhere” wireless interface is limited by the coverage offered by Sprint’s 3G wireless network. That network covers only a portion of the US and there is no coverage outside the US. Further, the speed of this network doesn’t compare well with a high-speed Internet service. For books and other text based content, the speed is sufficient, but the network falls short when it comes to expanding the feature set to include storage-intensive content such as audio books.

Many of the features newly introduced in Kindle 2 (text-to-speech, basic web browser, pdf conversion, and music/podcasts) are experimental and as such can be expected to have crippling issues. That obviously limits the value of the overall experience. Another major limitation of Kindle 2 is the lack of a color display – thus books sporting color illustrations are a problem…

All told, the Kindle 2 eBook reader is appropriate for only a very small segment of the population that can be defined as voracious readers who do not mind the cost. To morph Kindle 2 into a mass-market product, the hardware will have to be given away at a throwaway price – game console manufacturers have used this strategy successfully over the years and there is no reason why Amazon shouldn’t follow suit. Also, either the pricing on Kindle titles will have to go down drastically or Amazon will have to develop a used eBook marketplace.

04/2011 Update:  Amazon announced library lending for Kindle books on 04/20/2011 from over 11,000 libraries in the US. Also, pricing for the latest Kindle has come down drastically to as low as $114 (3G version is $189).

Last Updated: 04/2011.



Related Posts:

  1. Best Values in eReaders - A Comparative Review - 9/2010.
  2. Kindle eReaders - A Comparative Review - 9/2010.
  3. Kindle 2 eBook Reader - Is it Bleeding Edge? - A Frugal Take - 2/2009.

1 comment :

Marco Gustafsson said...

Thanks for the post, deep analysis and several brilliant ideas. If only decision makers from Amazom could see and share it before Kindle 3 appears.
Will you post about Sony PRS?

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