Friday, March 20, 2009

Kindle 2: Evangelist? Adopter? Skeptic? Which are you?

A guest post by Paul Vidich

The Kindle 2, Amazon’s new product has generated a lot of buzz about the future of e-books. Buzz is good because it demonstrates the interest of a community in the promise of a product. This condition, however, is often directly related to the desperation of the community, which is certainly palpable in the corridors of the humbled print empires.

So, what of the Kindle 2? What of the transition to a digital reader such as Kindle, iPhone, or the Sony eReader, all of which promise to enable electronic acquisition and consumption of text on simple to use, portable devices? Format transitions are new to books, which arguably haven’t had a technological shift since Gutenberg, but format shifts have occurred five times in fifty years in the music industry. Are there lessons?

Music’s current format shift is moving from physically distributed goods to electronically distributed goods, and movies are marching down the same path, although several years behind. Typically, consumers don’t adopt new formats unless there is a high order of magnitude improvement in experience – that’s what it takes to get past the switching costs, old libraries made obsolete, new behavior to adopt, etc. This was the case in the transitions from LP to CD and VHS to DVD. Digital music (e.g. iTunes) has caught on because it offers several improvements on the CD: a more convenient retailing experience (browse at home in a store that never has stock outs), ease of acquisition (a download takes less than a minute), the ability to buy a track and not the whole album, comprehensive storage and easy library navigation on the PC, and a simple transfer to a portable listening device with lots of memory.

The conversion to digital music has occurred without improving the sound quality, a major factor in prior format shifts. In fact, the acoustic quality of the digital download is inferior, some say significantly inferior, to the CD. But that hasn’t made a difference to consumers, who value the new experience holistically. Consumers buy downloads, even when the songs are still free on p2p networks, because they value the chain of experiences. People listen to music, but they pay for an experience.

So, what if any, lessons does this hold for e-books? The Kindle 2 has one remarkable quality and several features that are nice, but my experience, and that of my unscientific sample of other new Kindle 2 owners, suggests that there will have to be several rounds of ergonomic innovation, presentation and display enhancements, and content product ideation for a mass market to adopt the Kindle.

My Kindle 2 arrived via Fedex with my user account already established, so the unpacked device, once turned on, synched immediately to the Amazon store, and I was able to make a purchase without typing name or credit card information. Amazon has made buying and downloading e-books very easy, but the promise of flat screen reading falls, well, flat. The screen is clear, but words on the screen lack a book’s restful quality, the wonderful feeling that the text has been stamped or pressed in place, the feeling of permanence.

If you’re a book lover, repeated reading on the Kindle may help you overcome the loss of satisfying tactility, in the same way that we’ve all learned to accommodate reading PDF files on screen. For me at least, this means that so long as I have a book nearby I’ll always choose the book over Kindle. But books are heavy and the Kindle weighs less than a pound, so I might use the Kindle to take e-books on business trips or on vacation, or a college student might buy an electronic textbook, or even a chapter of a text book (if sold that way), because the trade-offs of weight, convenience, and experience favor the digital version. The Kindle 2, in short, feels more like an evolutionary device and not the revolutionary device that previously transformed the music and movie businesses as they changed from tape to CD, or VHS to DVD.

This week has seen two noteworthy announcements about e-readers. Sony, which expects to release a wireless web connected e-reader upgrade in 2009, announced that its site is making available for free half a million public domain downloadable books. Fujitsu announced the release of a color screen e-reader in Japan ($1,000). And Plastic Logic, a venture start-up that’s raised $200 million, will ship mid-2009 an e-reader that links to newspapers, magazines, and, the e-book retailer Barnes and Noble recently purchased.

Sony’s free book announcement does begin to change the appeal of an e-reader, although not the consumer’s preference for books. Consumers adopted new entertainment devices (CD players and DVD players) when there was sufficient content to enjoy the device. Sony’s announcement begins to enhance the consumer value proposition. After all, the unique attribute of text is that a word written in 1840 is the identical word used today. The text of Edgar Allen Poe’s Tales of the Grotesque and Arabesque, published that year, is identical to the text available in contemporary reprints. Technology has not changed the intrinsic value of reading the written word, whereas technology has been fundamental to the continued improvement in audio and video entertainment experiences.

Sony’s decision to open up 500,000 public domain downloads for free, is a significant value proposition. And, Sony’s offer is a fraction of the many millions of public domain documents (books, essays, manuscripts, archive materials, etc.) that have been digitized in the past ten years. Think of Borges, whose seminal short story, “The Library of Babel,” broached the notion of the “catalogue of catalogues,” which in today’s terminology would become “the index of indexes.” The question is: How does all that free content change the value proposition for e-readers, and how does an e-reader differ from a small laptop computer or from iPhone reading applications? The answer, no doubt, has already been written, but we’ll have to wait for it to appear.