Sony’s ereader strategy – analyzed by the Kindle Review
By Paul Biba
The site has a first class article (which is nothing new) looking at how Sony is going to attack the Kindle and giving the author’s analysis of its probability of success.
Sony has suddenly woken up to the fact that the eReader market is going to be huge and is making a lot of moves. Look carefully and a pattern begins to emerge with 3 main threads –
1. Attack all of Amazon’s weaknesses – This means being open (for now), going retail, and striking up collaborations.
2. Matching as many of Amazon’s strengths as possible. The tie-up with SmashWords is part of this.
3. Selling an electronic device that happens to read books i.e. focusing on the device.
Sony seems to have decided that eReaders are a market it needs to win and that this holiday season is the time to do it.
September 30th, 2009 at 11:17 am
The article missed (or glossed over) a point: Sony’s need to hold the Reader’s place among the growing list of dedicated devices entering the global market. All that e-book promotion won’t help Sony if the public decides to buy another company’s ePub-reading device.
September 30th, 2009 at 11:30 am
Steve hits on an important point. Barnes & Noble was giving Sony prominent placement in stores but they’ve moved on with their new ebook store and partnerships with Plastic Logic and others. That means Sony’s competitors have the high ground where a lot of people go to buy books both online and at retail. Adding to the too little, too late vibe, all Sony’s new distribution may not help offset the lost B&N deal.
I also didn’t see a mention of Apple’s upcoming, rumored tablet. It’s hard to analyze a product that doesn’t exist yet but it seems like an Apple tablet is more likely to appeal to Sony buyers on design/style factors rather than Kindle buyers who seem more about the reading, selection and book buying experiences.
September 30th, 2009 at 1:29 pm
Interesting to compare Sony Reader today with Sony Trinitron TV of 30 years ago:
When Sony made the Trinitron, they did not think they had to produce television shows to sell it.
When Sony made the Trinitron, they advertised a new feature in the display technology – a black comb filter – that produced the appearance of more richly-saturated hues and better contrast.
With the Reader, Sony uses off-the-shelf eInk and offers no refinements of its own.
With the Reader, Sony believes they must offer books and partner with publishers.
It’s a different world today. No longer can a CE company get by, it seems, by simply creating and manufacturing a better product.
Sony’s ePub strategy and partnering ploy seem only, to me, to doom Sony in this market. Other companies can produce readers that display ePub files; other companies can produce readers that display Smashwords files in other formats such as rtf. And other companies can produce eInk-screened readers and undercut Sony on price.
Maybe what Sony ought to be doing is partnering up with Qualcom and producing devices with the ‘Mirasol’ display – and getting some sort of exclusive deal with Qualcom for a few years.
Or better yet, adding their own refinements to PixelQi or Mirasol screens to be able to sell devices that look better than the competition.
My guess is that Amazon still wins on eInk screens; the real competition will come from a color, video-fast display. If the Apple Tablet does sell for $800, it won’t do the trick, either. The best competition against Amazon will be the color-screen reader that costs less than eInk screens to manufacture.
Even then, what’s to prevent Amazon from bringing out their own PixelQi or Mirasol display reader?
That online store, with a gazillion accounts, still gives Amazon a formidable edge for at least a few years to come.
September 30th, 2009 at 5:34 pm
@pond – you raise many good points, however, your guess that Amazon wins on the best e-ink screen is not correct. The current gold standard on e-ink screens for contrast and readability is the Sony PRS 505, not the kindle. As well, Sony has produced some really good ereaders in usability and price (505 and 300). Competitors at this point are great for getting devices out there, but still need to work on the GUI and button logistics.
October 1st, 2009 at 8:33 am
Three thoughts come to mind:
1- A lot of what Sony is doing in the reader space is out of necessity not strategic choice. Sony is a hardware builder, not a retailer. They (generally) do good hardware, fair-to-middling software, and so-so to poor services. In the book space they don’t own content and they don’t have any particular skill at online services and retailing; not in digital music, video, or books. What they know how to do is build electronic gizmos and use their brand to convince retailers to offer up shelf space. Add in Sony’s critical corporate finances and the millstones of the HDTV market and PS3 bleeding them dry and its clear that if the company is to compete in the emerging reader market they *have* to rely on partners for software and services and restrict themselves to the one aspect where they can bring added value: hardware design and assembly. When “nature gives you lemons” and all that…
2- While it is interesting to note what Sony is doing in going after the recreational/consumer reading market, it is worth noting what they’re *not* doing. They are *not* drawing from their other corporate product lines (PC, walkman, PSP, cellphones, etc) to address the totality of the ebook market with a conprehensive family of products. This does not strike me as a strategic assault on a market it “needs to win” but rather a tactical/defensive move. A “we can’t let Amazon do unto us as Apple did” rush job that shows their weakness more than any clear understanding of the future of ebooks. At this point, any ebook strategy that is focused solely on fighting Amazon over consumer recreational reading is: a) going to fail and b) miss the boat on the greater ebook market opportunities that are rapidly opening up.
3- The ebook industry is in is infancy. The overall market development corresponds roughly to 1985 in PC terms and 1999 or so in DAP terms. Contrast Sony’s (and Adobe’s) rabid anti-Amazon campaign to the actions of other ebook reader contenders; Brother, going after the corporate document management market; Fujitsu, playing for the long-haul with color displays for magazines and textbooks; iRex, building markup and handwriting recognition features needed for the textbook and corporate markets; ASUS, doing both a low-end eink reader and a higher-end dual-pane color reader. Even Apple’s mythical tablet and Microsoft’s experimental Courier and rumored Pink phone tell us there is life for ebooks beyond the NYT best-seller’s list and Google’s dreckware and these other (generally well-run) companies are going after the *really* big bucks in etextbooks, magazines, and corporate documents. (Plastic Logic may or not be up to something if they can get the newspapers to wake up to the 21st century.) And all these companies are doing it by playing off their strengths in media, software, and hardware. Even Amazon has shown (with the Kindle reader app for iPhone and its educational experiments with Kindle DX) that there are other markets for ebooks that need different devices and different feature-sets. Where is the Sony/Adobe reader for iPhone? Android? Symbian? WinMo? Where is the standard for anotation? Synchronization? Dictionaries?
It is early in the evolution of ebook reading.
The technology isn’t quite here for many of the *bigger* markets but it is here for some markets and some experimental explorations of user needs and market characteristics. Smart companies are dipping their toes and scouting out the terrain. But the game is just starting.
Amazon is an early market leader and nothing anybody does in the near term is going to change that. It is going to take years to catch up to where they are now much less to where they are going to be next year and the year after. Focusing solely on what they have achieved and neglecting the unserved markets where they aren’t yet playing is downright stupid. And serves nobody; not the wannabes and us, the customers to be.
Kindle is the Apple II of ebook readers. The Rio 300. The Palm Pilot. A trailblazer.
What Sony and the others *should* be doing is what MS and Symbian did to Palm, what Apple did to Rio and Creative, what Microsoft did to Apple; go after other *markets* in the same space. Attacking the trailblazer’s weaknesses is a minimal first step because the trailblazer will always have compensating strengths that come from being the first mover (installed base, mindshare, brand equity, network effects) that wannabes can’t match. It becomes a trade-off and first-movers always win trade-offs in the aggregate.
But going where the trailblazer isn’t and then building off that… That works.
And that benefits everybody; product diversity and competition is good for everybody except the lazy or the incompetent.
What the ebook business needs now isn’t a better Kindle; the Kindle is a focused, quasi-optimized device. What the industry needs is *many* non-kindles. Not a device that does most of what Kindle does (without the Amazon name) but devices that go where Kindles aren’t going.
And they need to get there before Amazon thinks of going there.
Submitted for consideration:
What if Apple’s iTablet is real and Kindle Reader runs fine on it?
What if Amazon puts Kindle reader on the Asus double-pane Reader or they match it with an lcd-based textbook reader?
What if they bring their corporate-computing Cloud Services into the document management arena to a touch-screen crunchPad-like kindle?
Amazon is the trailblazer; they can go anywhere they choose. They just can’t go *everywhere* they choose.
Good news for Amazon haters: trailblazers often get left in the dust by savvy latecomers.
Bad news for Amazon haters: savvy trailblazers *can* hang on to their early gains against all comers.
The game is Amazon’s to lose, not Sony’s to win, no matter what they try. And, push comes to shove, the likely winner when the dust starts to settle, circa 2015-18, will be neither.
It is early in the game.
The fun is just starting.
October 1st, 2009 at 10:28 am
A first-class article, and first class comments from everyone! … Here are a few more ideas.
At this point, it’s anybody’s game: there are many ebook reading devices available now, and many more coming in the future. Unquestionably, Amazon has the lead. But the recent “AmazonGate” incident (swiping Orwell’s ebooks from users devices) indicates that they might be vulnerable. A number of gurus agree that if Amazon does not scrap their proprietary format, they will shoot themselves in the foot (and higher).
H.G. Wells wrote: “Civilization is race between education and catastrophe.” If I were making and selling an ebook reading device (ERD), in order to catch up to Amazon, and leap beyond them, I would:
1. Educate the e-reading public about the limitations of proprietary formats, and the benefits of EPUB. An ebook reading device that can’t read EPUB is like a vehicle that can’t drive on the major highways.
2. Improve the ERD’s PDF reading and annotating capabilities. Princeton students, as reported in a recent TeleRead post, didn’t like the Kindle because they could not mark up their etexts the way they can scribble in their paper textbooks.
3. Maximize the reading devices’ audio capabilities for reading aloud.
4. In general, make a better product: improve the features of the reading devices. (Details about how to do this are in my book.)
5. Partner with Scribd, and create a better search interface for finding Scribd documents from independent publishers and authors.
6. Create a rebate program so that for each ebook you buy via the reading device, you get a credit toward your next purchase of a future reading device.
7. Ensure that your reading devices are “green”, the way Apple computing company has become environmentally conscious and transparent.
8. Sponsor an “Ebooks Save Trees” program: for every ebook sold, one tree will be planted. (That will not be difficult: partner with the United Nations program: “Plant for the Planet: Billion Tree Campaign”.
9. Sell the devices in stores, so people can see them and touch them and try them.
10. Get the devices out into the real world. Donate the devices to libraries. Get them into hotel room desks, instead of (or, in addition to) the usual reading matter deposited there. Make the devices available wherever people are forced to sit for long periods of time: such as doctors’ offices, where we can read all about our possible afflictions while we wait.
11. Partner with ebooksellers who give a larger share of the sale price to publishers. Amazon’s large cut on each sale (of ebooks and newspaper subscriptions) is making many publishers and authors wonder why they are working — and working so hard — for Amazon.
Michael Pastore
50 Benefits of Ebooks
November 1st, 2009 at 9:06 pm
Felix Torres raises a lot of good points: Sony (or whomever) does need to address a new market. But Sony already has! – the _library_ market. Sony still has the only reader that lets you check books out from the library – this is good for libraries (they get their funding based on usage, and download statistics add to their usage 24/7 in a time when libraries are often having to reduce hours) – and it’s good for a new segment of consumers.
Plus, as Michael Pastore points out, proprietary formats are the way of the past.
November 2nd, 2009 at 8:41 am
@Anna Peak: Yes, Sony is the only ebook reader manufacturer bragging about their library book access but they aren’t the only one that offers the feature since it comes from the use of Adobe Digital Editions. Pretty much the all Adobe ADE-based readers I’ve seen are compatible. And I distinctly remember Cybook and Hanlin users reporting success using Mobi software.
http://wiki.mobileread.com/wiki/Cybook_Gen3_Tips_and_Troubleshooting#Read_Borrowed_Library_Books_on_the_Cybook_-_How_to_Fix_the_Date
I’ll give Sony a half point for marketting skill for claiming a feature most other ebook readers also have.
I still think, though, that anybody looking for an anti-amazon bulwark should be looking to Google or Apple.