The Market for E-Readers

I agree with this statement:

But industry executives believe the time has come for consumers to begin embracing dedicated readers, especially as the prices fall into a comfortable range.

“There were readers who were perhaps unable to join the digital reading environment because our prior products might have been cost prohibitive,” said Brennan Mullin, vice president of the audio and digital reading divisions at Sony. “These latest products are breaking that barrier.”

[From Market for e-readers may be turning a page]

However, I think the hardware vendors miss the point that it ain’t about the device anymore… it’s about the content. Amazon, like Apple with iTunes, was able to translate an engineering achievement into mass market success because they made it drop dead easy to enjoy content on the device and they lined up a huge inventory of content that could be enjoyed.

The Sony e-reader is a superior device to the Kindle in many ways, but like Sony’s failures with digital music services their e-reader has lagged because Sony does not have anything comparable to Amazon’s service integration for content.

The Plastic Logic device is one to watch because they have the wireless deal in place as well as a relationship with Barnes & Noble to integrate content merchandising and fulfillment. This is smart but in many ways they are set up to always be “Avis to Hertz”… as in we’re number 2 but we try harder. It remains to be seen whether a competitor to Amazon that is simply a lot like Amazon can achieve the market momentum necessary to carry them forward in the U.S. market, which for reasons I can’t explain, operates as a zero sum outcome for digital services, as in a winner and a bunch of losers.

That Sony could fumble their clear multi-year advantage in e-readers is mind boggling, right up their with whiffing digital music and screwing up the goose that laid their golden eggs… the PS3. At this point I think it is beyond debate that this company is incapable of asserting leadership in any digital services market, the preferred outcome for Sony shareholders should be to break up the company and sell it off piecemeal.