Share

Kindle is 10 years old: from boom to price battle

Kindle was enthusiastically received by critics and the media but then, at the height of its success, the war broke out over the price of $9,99 and the big publishers managed to pit Apple against Amazon: here is the true story of the platform that changed the publishing

Kindle is 10 years old: from boom to price battle

Criticism and the press

The original Kindle and especially the Kindle 2 was enthusiastically received by critics and mainstream media. Ophra Winfrey, "the queen of reading," on her October 24, 2008 show, spoke of her Kindle as her "favorite gadget." Steven Johnson, the cultural critic of the "Wall Street Journal", wrote that he had his "ahah moment" in an Austin restaurant after downloading a book onto his Kindle. On the columns of the newspaper in an article entitled How the E-Book Will Change the Way We Read and Write he described his state of mind as follows:

It's that thing that happens when you flip a switch and something magical happens, something that makes you realize in an instant that the rules have changed forever.

He was echoed by Jacob Weisberg, editorial director of the Slate Group, in "Newsweek" writing that the Kindle was a superior experience to reading on paper and that "Jeff Bezos had built a machine that marked a cultural revolution". He then concluded assertively:

Printed books, the most important artefact of human civilization, are bound to catch up with newspapers and magazines on the way to obsolescence.

The then tech critic of the "New York Times", David Pogue, wondered if those at Amazon were not crazy to invest in an e-reader when the book itself was such a good object as to be so difficult to perfect. And instead it was to the extent that Amazon's e-reader allowed, thanks to its built-in connection, the immediate download of the book at half the price of its paper counterpart. The Kindle, despite its limitations and basic design, "may be the beginning of a great new chapter," concluded Pogue.

Even the "Economist" did not fail to grasp the importance of the launch of the Kindle. In an article entitled The book is dead. Long live the book (in some form) captured well the continuity of the Kindle with the book form, rather than the action of unhinging the latter. The Kindle was an object that extended and expanded the catchment area of ​​the book and rather than subtracting it had a cumulative effect, commented the anonymous columnist of the London magazine.

It was precisely the choice of a device mimetic of the book, based on substantially immersive electronic ink technology, because in fact disconnected from the vanity fair of the web, which made Amazon's proposal the most serious attempt to bring the book industry in the digital landscape. And it was precisely in this intelligent attempt to ferry the industry towards digital, that the "Economist" saw, clairvoyantly, the prodromes of a potential conflict between the dominant industry and Amazon. The November 20, 2007 article closed as follows:

In summary, the book business today is on the road to innovation. However, there is one aspect of this business that still remains immune to innovation: the big publishers take from six months to a year to bring a manuscript to the shelves of a bookstore. If Jeff Bezos succeeds in introducing the logic of the Internet into this aspect of the publishing industry, the world of books as we know it today will be dead.

In reality, the Punic war between the big publishers, backed by mainstream authors, and Amazon would not have broken out on publication times, but on the price of ebooks.

The sales

In terms of sales, the Kindle was also a meteoric success. We don't have official data, Amazon merely commented that the Kindle was selling beyond expectations. Some analysts estimated that more than half a million Kindles had been sold in 2008: a remarkable result considering that the device was sold out until spring 2008 and again from November of that year throughout the holiday season following the now experienced Winfrey” on readers.

It was also observed that Kindle owners tended to buy more than book buyers. In the “Wall Street Journal” Jeffrey Trachtenberg and Christopher Lawton spoke of the “whim factor”, an almost Pavlovian phenomenon which is expressed in an impulse purchase immanent in the very act of buying. A phenomenon that began to be observed, in this same year, also for the applications that were compulsively downloaded from smartphones. The purchase with a click and the attractive price does not put time between the arising of a desire, even a capricious one (whim in fact), and its fulfillment. A Pavlovian mechanism induced by the extreme efficiency produced by the combination of software, communication and ease of use.

The great authors

In spring 2009, within months of its February 24, 2009 launch, the Kindle 2 already had 1500 5-star reviews in the Kindle Store. Rumors also circulated about the sales of the device: it was assumed that in less than a month and a half Amazon had sold over 350 copies of its player. Jeff Bezos declared that ebook sales amounted to 10% of total book sales (we are in 2008), an unexpected result and that no one at Amazon would have dared to hope for.

The Kindle was also well received by great authors, bestselling writers such as James Patterson used to climb the charts of the New York Times Bestseller List (67 titles have conquered the top of the list for a total of 350 million copies sold) as well the steps of his mansion in Palm Beach. Patterson's enthusiasm for the Kindle prompted him to appear in an Amazon commercial to assert that the Kindle 2 was a super thing because it allowed him to read, poolside, without the breeze ruffling the pages of the book. And then they say that writers are not snobs!

Another climber of the rankings, Stephen King packaged an ebook entitled Ur, a borderline story between an info-commercial and a short story, to be distributed exclusively on the Kindle store at a price of $2,99. Ur, which featured a pink Kindle on the cover, achieved a staggering 5-figure download in three weeks. The keystone of the story was the Kindle's Ur function which entered a parallel universe and allowed to change the course of events in the real world. After the proverbial 5 km walk, during which he elaborates on the ideas on the plots of his stories, Stephen King decided to accept his agent's proposal to write a story for Amazon only if "I can write a story on the Kindle". Wish fulfilled.

The great storyteller commented on his decision in this way which also made some fans frown:

Gadgets fascinate me, particularly for their anomalous aspects. I've written about killing machines, malicious computers, mind-destroying cell phones. When Amazon's request came, I was brainstorming an idea about a guy who gets emails from the dead. The story I wrote, Ur, is about an e-reader that gives you access to books and newspapers from a parallel world. I knew I could be vilified by some literary blog that would accuse me of selling out to Jeff Bezos & Co., but that doesn't really interest me; In my career I'm used to being vilified by solons, and I'm still standing.

Both Patterson and King would soon change their minds about the Kindle, publicly regretting this initial endorsement, which would spill over into open hostility. Already in the spring of 2010 King regretted having contributed to the diffusion of the ebook declaring that instead of writing Ur he should have written another story entitled The Monster That Ate the Book Biz.

dollars 9,99

The cover of the story written by Stephen King especially for the Kindle. In fact at the end of 2009 that was what was happening. In a telephone interview with Steven Levy, Bezos stated at the launch of Kindle International that 48% of all books sold on Amazon.com were Kindle ebooks. The price of $9,99 (book = $16) was pushing them beyond their unreasonable expectations. In January 2010 Michael Arrington on "Tech Crunch" estimated that the Kindles in the hands of readers were 3 million. Forrester Research, a market research firm on the impact of technology, estimated US ebook revenues at $500 million in 2010.

Amazon sold Kindles and Kindles sold ebooks. Thus there was a network effect in full deployment. It also happened that Kindle owners turned into strong buyers as was happening to consumers of applications and video games. Forrester also estimated that Kindle early adopters read three and a half books a month, while late adopters, i.e. the younger audience, less well-off than the first and very price-conscious, read five and a half books a month. In the end, it was the market and reading, as Bezos never tired of stating, that benefited from the diffusion of ebooks. But not everyone was of this opinion.

At the end of 2009 the Kindle was on the shields of consumers and it was therefore not surprising that a growing concern for their traditional business began to spread among the large publishers and incumbents. Was it time to put a stop to Amazon? Surely. We just had to react. Indeed, on January 31, 2010, Amazon communicated on its forum that it had received a communication from MacMillan, one of the big five, which ordered it to raise the price of new fiction and non-fiction ebooks from 9,99 to a price between $12,99 and $14,99. Publishers were starting to demand a new agency-model business arrangement whereby the publisher sets the price, leaving Amazon a 30% commission.

A step that would have definitively put an end to the practice of buying for $12 and selling for $9,99, a unilateral operation made possible by previous agreements based on the wholesale business model which left Amazon free to set the price per minute. This price upgrade undermined Amazon's strategy to capture market share for the Kindle. What had happened? Steve Jobs' Apple had entered the game, pulled by the collar by the big publishers headed by Rupert Murdoch who saw Jobs as the only counterweight to Bezos.

comments