The Amazon Kindle reader has been an important factor in the growth of the e-book reader and e-book market. The original Kindle hit the market in November of 2007. The Kindle 2.0 was released in February of 2009 and the large format Kindle DX followed in the summer of the same year.

Amazon’s Kindle readers led the market with a 60% share of all U.S. e-book reader sales. Sony’s PRS reader - which was actually available in 2006, some time before the Kindle - followed in second place with a 35% market share. Other companies quickly saw the huge potential of the rapidly developing e-book reader market and either launched or updated their own readers in order to get a share of the available sales.

Manufacturers like Bookeen, Plastic Logic, Sony and Barnes and Noble worked hard to get their share of the rapidly developing market. However, the dominance of the Kindle seemed pretty well established, if not unassailable. It was only with the release of the Apple iPad that the Kindle faced any serious competition - despite the fact that the two devices were very different and were, you might imagine, aimed at different market segments.

Since the release of the iPad, e-book reader prices have dropped significantly. The Kindle 2.0 is selling for just $ 189 right now, a huge drop on the $ 359 launch price of February 2009. The large format Kindle DX has been upgraded, being fitted with a new improved screen, and has had a price reduction from $ 489 to just $ 379. Barnes and Noble have also dropped the price of their Nook reader from $ 259 to $ 199.

The price of e-book readers may be falling, but the same cannot be said about the price of the e-books which these devices are used to read. Once again, Apple were instrumental in this. Prior to the launch of the iPad, Apple had established their own book store and agreed a pricing deal with the major publishers which basically allowed them to set the price of their e-book editions at whatever level they wanted. The only caveat being that they could not offer the same e-book version at a lower price for any other reader. This effectively killed off Amazon’s plan of pricing e-books at $ 9.99 or lower and was very popular amongst the publishing companies.

Amazon may have had to abandon their policy of pricing e-books low - but that wasn’t necessarily a catastrophe for them. Considering the way that Amazon have made it possible to read Kindle books on such a wide selection of different devices,  it seems obvious that Amazon are more interested in book sales than reader sales. Currently you can use the PC, the Mac, the iPod Touch, the iPhone, the iPad, your Blackberry and any device which uses Android to read Kindle books (and no doubt there will be more  free Kindle apps in future). This downward price trend for e-book reader hardware and simultaneous price increase for e-books means that Amazon can now market the Kindle reader hardware at a lower price and still turn a profit by selling e-books throughout the life of the hardware. The same will apply for Barnes and Noble and Apple themselves of course.

This is a trend which may well favor those companies who have an interest in book selling as well as hardware sales. Considering the current number of devices which can be used to read Kindle books, it looks as if Amazon will be a major player in the future of digital publishing for some time to come.

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