Amazon's Kindle: Read it and Weep?

Dennis Faas's picture

In 1975, Rock Bottom Productions introduced a product called the Pet Rock. It was cute and it was novel. Pet Rocks sold for $3.95 each, were the rage for the 1975 Christmas season, and they made its developer, Gary Dahl, a millionaire. The following year, you couldn't give a Pet Rock away.

On November 26, 2007, Newsweek announced Amazon's new wireless reading device: the Kindle.  According to Amazon, when it was made available for sale, Amazon's complete stock sold out in 5-1/2 hours. (Source:

Any way you look at it, the Kindle is a bold move by Amazon, and could change all the rules in publishing and book distribution. But, does that mean that books are soon to become a relic of the past? Does it mean that Amazon will dominate the reading device sector? That traditional book publishers are antiques? Or does it mean that the Kindle, retailing for $399 this Christmas season, is just another Pet Rock?

Time will tell. The success of the Kindle -- no matter what the initial enthusiasm -- is not a slam dunk. The trail of consumer technology is littered with the trash of leading edge innovations that gave up their short lives to light the path for others. It happens all the time.

Consider this: The first PC spreadsheet, VisiCalc, sold millions of copies. Ten years later, Microsoft Excel made VisiCorp history. Anybody remember the fanfare about Apple's Lisa? Arguably the second Windows-based PC in history (Xerox's Star was the first), it sold for around $10,000 and had a two-year lifespan during which 100,000 units were sold. (Source:

Ten years later, Microsoft Windows was the de facto standard and while Macintosh remained, Lisa was nowhere to be found. There's a long list of similar stories: the 5-pound cell phone, 8-track music cassettes, the Osborne 1 portable computer, the Beta videotape, the generic MP3 player, and (time will tell) the tablet PC. All of these at one time boasted rave reviews.

There's no doubt that Amazon has done a lot right with Kindle. It's sexy, wireless, intuitive and has lots of content. But before you run out and buy one (or run out and sign up for the waiting list) ask yourself this:

What are the competitive barriers that Amazon has in place?

If there are too few, expect to see many more new ebook readers; hardware-based and software-only versions will soon hit the market created by Amazon's leadership. On the other hand, if Amazon has too many competitive barriers, expect the ebook marketplace to turn into a war zone too dangerous for the average consumer or book publisher. Only time will tell whether Amazon's brave effort will result in its leading, or its bleeding. Even with all the fanfare, it's way too early to tell.

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