Amazon’s Kindle price cut is a step in the right direction, but it’s too small to make a big difference in sales.
At $259, the Kindle 2 e-reader is still too expensive for most people — who don’t want to spend that much money for a device that’s only good for one thing, reading books. The $40 savings represent a 13% price cut — simply not enough to drive sales much higher.
More interesting is the new Kindle with international roaming, which makes the Kindle more useful to U.S. buyers who travel abroad — the kinds of upscale people who buy Kindles in the first place — and people who are interested in e-readers but live outside the U.S.
This could open up an entire new population of Kindle buyers who simply couldn’t use the previous version, especially as Amazon will now ship the device to many foreign countries. But at $279, that’s only 7% cheaper than the Kindle was yesterday, so there will still be a large percentage of people who think that’s too expensive.
The Kindle will no doubt be a popular Christmas gift this year among wealthier classes, and every step toward $99 is a good one. But at $259, it’s still not going to become a must-have device for regular use.
Longer term, e-readers will pick up more users as prices continue to fall, but new competition should arrive next year, in the form of colourful, multi-use tablet gadgets from the likes of Apple. For many, especially the early-adopter set, it probably won’t be hard to justify spending 2-3x as much for a similarly sized device with much more utility.