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Kindle Pricing, Business Models and Source Code

Posted by Soulskill on from the still-waiting-on-a-price-cut-to-ten-bucks dept.

narramissic writes "A trifecta of Kindle-related news surfaced this week, with Jeff Bezos speaking at Wired's 'Disruptive by Design' conference on topics including Kindle pricing and business models. And yesterday, reports blogger Peter Smith, 'there was a flurry of blogging activity yesterday stating that Amazon had released the Kindle source code. Once everyone caught their breath, it became apparent that the files in question were just some open source libraries that Amazon had modified (they're being good open source citizens and releasing mods they've made to open source code — good for them!), not the complete source code.' Now, back to the Kindle pricing: According to a post at Wired, Bezos said Amazon opted to sell the Kindle for 'something akin to the actual cost for hardware,' rather than subsidizing the hardware costs and requiring a monthly subscription or requiring the buyer to purchase a certain number of books per month because 'fees and minimum purchase requirements create friction.' Smith has a different take: 'If I'm buying a Kindle from Amazon that enables me to buy books from Amazon, I'm broadcasting a desire to buy Kindle books. I would welcome some subsidization of the hardware since I'm going to be buying content anyway. No, I really think Amazon priced the Kindle the way they did because they thought they could get away with doing so (and they were right, it would seem).' Meanwhile, over at the New York Times, Bezos said 'that he sees Kindle-the-device and Kindle-the-book-format as two separate business models, and that the Kindle iPhone App won't be the last software reader to appear.'"

12 of 156 comments (clear)

  1. End of print periodical? by bhsx · · Score: 4, Interesting

    Rupert Murdoch has apparently been watching the Kindle closely and has been planning on coming-out with his own version to give away to subscribers of his newspapers. Perhaps Bezos really did have the timing right with the Kindle and it just MAY unseat a large portion of the print periodical industry. Should be interesting to watch, no matter how it works itself out.

    --
    put the what in the where?
    1. Re:End of print periodical? by larry+bagina · · Score: 4, Insightful

      Maybe you haven't noticed, but a large portion of the print periodical industry is being unseated without the kindle's help.

      --
      Do you even lift?

      These aren't the 'roids you're looking for.

    2. Re:End of print periodical? by Brandee07 · · Score: 3, Informative

      Found it! http://kindlefeeder.com/

      Amazon didn't shut them down, someone just noted that it could be construed as against the TOS, but efforts at contacting Amazon for legal clarification have not been returned.

    3. Re:End of print periodical? by Anonymous Coward · · Score: 4, Insightful

      Since I purchased my Kindle 2 I have purchased more individual newspapers than I have in the last 5 years. I like the ability to pick up the Wall Street Journal one day and Boston Globe the next. Also during my commute if I see an article in a paper while reading over their shoulder I immediate go to Amazon and buy that days print.

      I think Peter Smith has it wrong and Jeff got it right. I purchased the Kindle at this price point because I was not tied down to any contract. I read a lot of books and with the Kindle I now have them all queued up. Not all of the books were purchased from Amazon. The Pragmatic Programmers is a publisher that gets it and other publishers should take note. I went to there site to see if they were going to off ebooks for the Kindle. Little did I know they already do. I logged into my account and that is when I got an alert telling me that the two ebooks I purchased a year ago have updates. Hmmm... Would be cool if I could trade these in for the Kindle version. BLAM A click of the link and the PDF and Kindle versions were ready for me to download. No extra cost. Now if only Manning and a few other publishers would get this.

  2. Kindle 1 owner by BigHungryJoe · · Score: 3, Interesting

    there's more than one "Kindle-the-book-format", though. There's the regular Kindle file, azw, and there's one they call the "Topaz" format (azw1), and it sucks. I love Vernor Vinge, and unfortunately, lots of his stuff is in topaz format on the Kindle.

    Huge numbers of artifacts - lines printed over other lines, skipped lines, and sometimes the first word of a sentence has huge amounts of whitespace between the first and second letter.

    Other than that, love my Kindle.

  3. Re:Subsidized hardware by TheRaven64 · · Score: 4, Insightful

    Why is it only in the tech-gadget industry that people expect manufacturers to sell items for *less than cost*?

    I know! People would think you were crazy if you suggested selling a razor at below cost to encourage people to buy them and let you make money from the blades.

    --
    I am TheRaven on Soylent News
  4. Don't subsidise the hardware - subsidise the books by Tryfen · · Score: 3, Insightful

    The thing that stops me taking the Kindle is the huge upfront cost. I can buy 200 books for the price of one Kindle. Obviously, the Kindle has all sorts of advantages over regular books, but it's quite a steep cost.

    I think Amazon should subsidise the books. Make the Kindle come with, say, $200 worth of vouchers redeemable in the Amazon store. Make it $100 worth of general vouchers and $100 worth of 2-for-1 deals. Anything to cut the apparent cost of the hardware.

    Digital content has no intrinsic cost, so it's not much of a subsidy on their behalf.

    --
    If a square is really a rhombus, why aren't all triangles purple?
  5. Re:Don't subsidise the hardware - subsidise the bo by Brandee07 · · Score: 3, Informative

    Digital content has no intrinsic cost, so it's not much of a subsidy on their behalf.

    While I'm a huge fan of free stuff, I would like to point out that they still have to pay the authors and publishers for use of the copyrighted material.

  6. Re:Don't subsidise the hardware - subsidise the bo by Itchyeyes · · Score: 3, Insightful

    That's not a subsidy. They can't sell digital copies for the same amount as hard copies because their customers know that it costs them significantly less money to produce. They're still selling both the hardware and content at a profit. A subsidy is when you use profits from one product to offset selling another product for a loss (eg Sony sells the PS3 at a loss but makes it up by charging a $10 royalty on every PS3 game made, even if they had no hand in the development/production/distribution of the game).

  7. Re:I'd prefer to rent an ebook than own it by Tikkun · · Score: 3, Funny

    98% of books and 99.9% of magazines I never re-read. I'd prefer a library model, say $1 a day to read a book, then I could stop access and paying for it. The main exception would be course-texts.

    I love libraries! You should check out TPB, I've heard they have a great selection of books and magazines you can borrow. Just like an analog library, but from your home computer or mobile device! ;)

  8. Not buying Kindle books for my Kindle... by TheMCP · · Score: 5, Informative

    I have a Kindle. I love it. But I'm not buying books from the Kindle store for my Kindle, because they're DRM-encrusted. I'm buying my ebooks from another legitimate source which sells them to me in formats I can convert, and I convert them into Mobi and put them on my Kindle using Calibre.

    So, buying a Kindle does not automatically signal a desire to buy Kindle books. Some of us just like the hardware.

  9. Mobipocket and DRM by krischik · · Score: 3, Informative

    First: the DRM has been broken - AZW is the Mobipocket file-format with just one byte changed so a Mobipocket reader software won't accept it. So to break Amazons DRM google for "MobiDeDRM" and "Kindle Mobipocket conversion" - it will be the #1 hit ;-).

    Now having said that you might notice something: Mobipocket has free to download readers for just about 12 different devices. So if Amazon wanted what you suggest all they had to to is not change that one byte. So in changing that one byte it is a clear signal that that they want there books to be read on Kindle and Kindle alone. And iPhone is just a special exception.

    Before you wonder: Amazon owns Mobipocket [1] - so no they won't change there reader to accept Kindle books. In fact Mobipocket has stopped producing new reader software all together.

    It is not difficult see the evil masterplan behind: The typical Embrace, Extend, Extinguish plan which is now in the last phase: Mobipocket to be extinguished by not creating new software for todays devices. Amazon even got as far as stopping the finished Mobipocktet iPhone reader. And last not least: not licensing the Mobipocket file format to Sony.

    For those who own Mobipocket books - ahh sorry mate you loose. Only by now Amazon has pissed of European customers [2] big time. After all we can't buy Kindle and feel the Mobipocket demise double. And we found out about Sony.

    Martin

    [1] http://www.mobipocket.com/
    [2] http://www.mobipocket.com/forum/viewtopic.php?t=15520