The Amazon Kindle e-book readerConsidering that Amazon has, in the perception of the buying public, a very strong link with both electronics and books the Kindle is a great fit for Amazon’s business model.

During the course of 2009, e-book readers as a whole, and especially the Kindle, were the hot “must have” gadgets of the year. It’s predicted that sales will continue to grow very rapidly throughout 2010. The market is still very new and is changing and developing rapidly.

Right now, the Kindle is way out in front. It currently has a 60% share of the U.S. e-book reader market. Sony takes the second place position with a smaller but nonetheless creditable 35% market share. There is a long list of competing manufacturers who have now developed e-book readers of their own in order to get a piece of the action in what looks like being a large and lucrative market.

In a way, it’s a back-handed compliment to Amazon that virtually every new e-book reader that shows any promise is immediately given the title of the “Kindle Killer”. However, considering the fact that the Kindle is now Amazon’s best selling item, you can be sure that Amazon will fight hard to see off challengers for the top slot.
Amazon has responded to the increased competition by lowering the price of the Kindle 2.0 from its $ 359 launch level to $ 259. The price of the Kindle DX remains, for the moment at least, unchanged. There have also been firmware updates, including prolonged battery life and the addition of pdf support for the Kindle 2.0, among others.

Amazon has also now released both the Kindle 2.0 and the DX in more than 100 countries around the world. In reality, Amazon could probably sell Kindles in the States as fast as it could manufacture them – but establishing an international Kindle presence is a wise long term strategy for Amazon.

Over and above developing the Kindle reader itself and entering new markets, Amazon continues to increase the selection of Kindle books available on its Kindle store. There are currently over 400,000 titles available – and this number is growing at an average rate of over 500 a day.

So, although there are a lot of manufacturers scrambling to develop e-book readers in order to grab a share of the market, Amazon probably has good reason to feel quietly confident. Rather than simply focusing on the development of the hardware itself, Amazon is making improvements in a number of different areas. They are improving the existing Kindle, adjusting prices, growing their market, expanding the choice of books on offer and generally capitalising on their dominant market position. Whenever they decide to launch the Kindle 4 – expect to see it sometime in 2010 – they are going to consolidate their leadership position even more.

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