As a sometime frustrated original Kindle owner (mainly due to the fact that they have never reached out to me since I paid the $ 399 for the now dinosaur-like 1st edition) ,the news this week http://on.wsj.com/i9NHe2 that Amazon has come up with an even less expensive option by offering an advertising-supported Kindle made me even more annoyed. The same exact Kindle currently on sale for $ 139 will now be available for $ 114 with ads popping up on the home page but not during the ‘reading’ experience.
The idea itself is both interesting and perhaps even overdue. What surprised me is the small difference between the price for a Kindle with and without ads. Keep in mind that the Kindle owner can turn off the Wi-Fi so that ads will not be served and you can read on your Kindle without ads except when you go the Kindle store to buy something.
I take it as some type of return salvo against Apple’s iPad 2 which still has A T & T Wireless customers still lining up in the streets in order to try to get one. From the article in the Wall Street Journal from April 12th by Stu Wood – ‘Some in publishing suggested that the new lower price is a savvy move.’ “People won’t hesitate to buy the cheaper device because advertising is everywhere we look,” said Richard Curtis, a New York literary agent and digital book publisher. “People will think it’s a good trade-off.” And if they actually look at the ads, so much the better for the advertisers and Amazon”.
But only a $ 25 discount? Amazon is said to have sold more than 5 million Kindles in 2010 alone. If half that universe purchased an ad supported Kindle in 2011 that would mean a universe of 2,500,000 for which ads could be served. It seems to me that even with modest projections the lifetime value of the purchasing consumer would be worth far more than a measly $ 25 discount.
If Amazon truly wants to make makers of other E-readers and tablets take notice, the price of an advertising-supported Kindle should come down even more – how about $ 49? How about free with the purchase of 10 or more books from the Kindle Store?
Or how about a free Kindle if the customer buys an advertising-supported Kindle and also agrees to purchase 10 books from the Kindle store over a defined time period? That’s how Columbia House Record Clubs, BMG Records and Book of the Month did it for years. Only this time the books are delivered electronically so there is no cost for shipping and handling.
How about it – would you like a free Amazon Kindle with ads and a promise to buy a certain number of books over a certain period of time?
Check out this article from a few months ago. http://kottke.org/11/02/the-kindle-wants-to-be-free
Guess the idea is not all that unique but how they decide to execute will be critical. The landscape is quite a bit different than what it was when that article was written. Thanks for the comment Doug.