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Thursday, January 28, 2010
Apple iPad Impressive, but Kindle Not Dead Yet

Apple's iPad announcement is big news. It's a robust tablet form factor that is a half-inch thick and weighs 1.5 pounds, with a 9.7-inch capacitive touchscreen IPS LCD display that supports 1024x768 VGA video.

The ebook implementation is everything one would expect. The application can be downloaded from the App Store and the content is managed by the "iTunes" platform, so it seamlessly integrates e-book with the other popular personal content. All iBooks are stored on your Bookshelf. As you would expect, all books are displayed on a sharp, color screen with many personalization options.

However, just because iPad has launched and is an impressive device, In-Stat cautions individuals who are quick to write off the e-reader segment. The market, which includes e-readers like the Amazon Kindle and the Sony E-Reader Daily Edition, has firmly established itself in the US market; there is plenty of room for growth that new features such as e-mail and Web connectivity will drive.

Overall, the e-reader market continues to heat up as Amazon aggressively markets its Kindle lineup, Sony expands its offerings, and new market entrants continue to crawl out of the woodwork. Additional market drivers include international expansion of e-book availability, anticipated price declines, and the electronic distribution of newspapers.

"In the short term, though, I don't see the iPad demolishing Kindle sales," according to Stephanie Ethier, In-Stat Analyst. "Today's e-reader customers are looking primarily for a seamless e-book discovery+purchase+download experience. In other words, they're buying Kindles to read. Sure, the current generation of e-readers can support a number of other functions, like PIM and other computing functions, but fundamentally, customers are purchasing Kindles and Sony E-readers for a revolutionary reading experience.

"Future generations of e-readers are expected to evolve in such a way that the line between e-readers and tablets will blur substantially. The immediate impact the iPad has on the Kindle is that the iPad is going to ignite the tablet market. Therefore, the blur between tablets and e-readers starts within the year, and will impact the outlook for future Kindle, and all e-reader, sales."

Recent research by In-Stat found the following:

- Amazon is the leading brand of e-book owned.
- Worldwide e-reader shipments are expected to reach 28.6 million units in 2013, up from 924,000 in 2008.
- The largest percentage of e-book owners (45.5%) is spending between $9 and $20 a month on e-book content.
- Eleven percent of total survey respondents said they planned to purchase an e-book over the next 12 months.

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