[...] Jeff Bezos pushes “competition” for Kindle hardware [...]

[...] Jeff Bezos pushes “competition” for Kindle hardware [...]

I stand by my contention that it’s misleading to write Amazon “is taking a ridiculous 70 percent of revenue” without explaining that’s just in the sidelights. In the book business, they take far less – less than zero in many cases. The competition you cited in this context is Google’s ebook effort — again — not the business where Amazon takes 70% of revenue. And coming from the reader/consumer point of view that you seem to be taking, what Amazon has done in ebook pricing is extremely pro-consumer. What Google is doing, much less so.

I think Amazon Amazon is betting that content will be the commodity. Very shortsighted. They have already collected the content and created the community. They can charge for convenient access to that, and make money. That is the value.

The 70% figure is not just from one unhappy newspaper publisher; it was confirmed by the NYT. And I can also confirm it’s the deal they offer bloggers published via the Kindle, since I publish this one there and get the revenue reports.

Things started getting more specific back in February, when there was the AP story about Kindle coming to unnamed mobile phones. When Amazon introduced the iPhone app in March, again they said this was just the beginning. When they bought the maker of the Stanza ereader app in April, the talk was of how the real target was the programmers behind the software who could help Amazon extend Kindle to other mobile platforms.

The REAL news here is that Bezos says he is not running a razors and razor blade business model. He is not subsidizing the price of Kindle books with hardware Kindle revenues. That can only mean one thing: higher Kindle book prices down the road.

Despite your misleading 70% citation, a figure which is attributed to one unhappy newspaper publisher, Amazon is selling many, many of the most popular ebooks for less than a 0% revenue share. Major book publishers collect ebooks royalties of 50% to 60% of the undiscounted hardcover list price. Take a look and you’ll see that virtually all Kindle $9.99 books carry hardcover list prices of well over $20.

There has already been some evidence of prices creeping up in the Kindle book store but I take Bezos recent comments to mean that eventually the $9.99 offerings will be limited to the very top best-sellers and most books will see higher prices. And I don’t think competition from Google’s new ebook program will present much of an obstacle to higher prices since that’s almost its whole reason for being (Google will let publishers set prices directly).

I’d argue with your misguided notion that single-function devices like Kindle can’t succeed or your mistaken view that the Kindle is aimed at techy early adopters like yourself but I’ll save those bits for another day.

The kindle is not kludgy. It only does one thing. Makes it convenient to get and read books when it is presently inconvenient. Waiting on lines, riding the subway, traveling on vacation and waiting in the car while your partner is shopping.