Amazon Kindle DX product launch, May 6th 2009 in N?YC

[DMcCunney]

On Wednesday, May 6th, 2009, Amazon.com hosted a press conference in New York City. They didn't announce the topic, but the subject wasn't hard to guess. Rumors had been flying about a new model of the Kindle eBook reader with a big screen, and leaked prototype photos had shown up on the web. Indeed, that's what they were announcing: the Kindle DX.

The conference was hosted in the Michael Schimmel Center for the Arts at Pace University in lower Manhattan, a hop, skip, and jump from City Hall and the Brooklyn Bridge. The presentation took place in a large auditorium, and there was a fairly full house. (I wound up seated in the balcony, which made photos of the presentation itself problematic. Fortunately, the folks at
Engadget were able to remedy that lack. See http://www.engadget.com/2009/05/06/l...-event-in-nyc/)

Amazon CEO Jeff Bezos came in from California to handle the presentation, underscoring Amazon's commitment to the Kindle. Jeff is a skilled presenter with an informal and humorous style that doesn't come off as scripted.

He talked a bit about the Kindle's success, stating that 35% of all books sold by Amazon are now electronic Kindle editions, up from 10% a year ago. He also showed one slide of a sales graph, with a dramatic spike in sales coinciding with the release of the Kindle II. He stated Amazon has added 45,000 new titles in the last 3 months, and there are now 275,000 titles in the Kindle Store, including 107 out of 122 current New York times bestsellers. Bezos claimed Amazon "picks from the top". They can mine the enormous amount of data Amazon has on book purchases, and go first for the material the customers have demonstrated they want to read.

He then talked about the new features of the Kindle DX, and the problems it was designed to solve. The biggest new feature of the DX is the large screen. According to Jeff, that is driven by the content. The DX is intended to display a range of documents that aren't necessarily ebooks. He wants the Kindle to become a tool used for personal and professional documents as well They tend to be documents implicitly designed to be printed out, and formatted for an 8.5 x 11 page. Such things simply don't display well on smaller screens, and require large monitors to view effectively.

Jeff talked about how computers have not reduced the amount of paper in use for documents, and blamed standard backlit computer screens. He feels they are simply too hard to read for extended periods, and people print stuff out because it's easier to read on paper.

Another market Bezos saw as natural for the Kindle was education. He stated that Amazon had agreements in place with textbook publishers Pearson, Cengage Learning, and Wiley, who between them account for 60% of the textbooks published. He announeced partnerships between Amazon and five universities - Arizona State University, Case Western Reserve, Princeton University, Reed College, and the Darden School of Business at the University of Virginia, to integrate the Kindle into the learning process. He then introduced Barbara Snyder, President of CWU, to talk about what they were doing.

Snyder stated that CWU is a research school, and they will be carrying on a research project, investigating how the Kindle can be used in an educational setting, and what the effect will be on the learning process, and how the students interact with the subject matter and their teachers, and collaborate with other students. There will be two groups of students involved, one set with Kindle DXs, and a second group of the same size using traditional textbooks as a control group.

One thing Bezos stated customers liked was "automagic" delivery of electronic versions of their newspapers, with subscriptions that "followed them around". They could be traveling, but because they got the paper electronically, it didn't matter where they were. The Kindle uses 3G cellular transmission to retrieve it.

At that point, Jeff introduced Arthur "Punch" Sulzberger, CEO and Publisher of the New York Times Company, publishers of the New York Times and the Boston Globe. One of the targeted applications for the Kindle DX is electronic versions of newspapers, and the New York Times is highly interested. The Times, the Boston Globe, and the Washington Post will be part of a pilot project partnered with Amazon to provide digital editions of their paper's content. The papers will partially subsidize the Kindle's cost to the consumer, in exchange for long term subscription commitments. Sulzberger professed enthusiasm for the technology and optimism about the possibilities. He said the Times intends to do a test rollout concentrating on readers in areas where home deliveries of actual printed papers are not feasible.

Bezos then demonstrated the Kindle, with the device being projected on a large screen behind himj as he put it through its paces. At one point, and amusing technical glitch had the image on the screen reversed. Jeff said "That will not be a feature present in the device we are rolling out." and said "I'm going to treat this as hilarious..." to laughter from the audience.

Several interesting new features were debuted. Using the Times as an example, he discussed the ways in which people read the paper, and talked about flipping through articles sequentially, but also have the opportunity to navigate by section of the paper, and drill down from there. The Kindle use a preview mode, that will present not only the headline, but also the first few lines of content of the article, to allow a better judgment about whether to read the entire piece. The Kindle also has an automatic display rotation capability, and will adjust the display for proper viewing if you shift from portrait to landscape mode.

After Jeff finished his presentation, the audience adjourned outside, where Amazon staffers were available to anser questions and demonstrate the devices.

The DX is an incremental upgrade over the current Kindle II, with several additions.

Because the Kindle DX is intended for a broader range of documents, one important addition is the ability to view PDF files. Amazon achieves this by licensing Adobe's Mobile PDF technology. This is critical, as one intended use of the Kindle is for viewing textbooks. The vast majority of textbooks will be in PDF format if they are available electronically at all, simply due to the nature of the content.

Another is the addition of RTF as a supported format. This will be useful, though less critical, as every word processor I'm aware of can read and write RTF format documents.

I spent some time after the presentation speaking to some of the Adobe representatives to get a few further details, and to a few of the other attendees. Barbara Snyder provided a bit more background on CWU's Kindle project. They'll begin in the fall semester, and have a groups of 40 students with Kindle DXs and another group of 40 without DXs as a control group. The DXs will be loaned to the students, and will remain the property of CWU, though the students will be offered the option to buy them at the end of the project.

Christopher Cory, who is Pace University's Public Information Director, grabbed me to provide an update. While the deal was made too late to be inclided in the presentation, Pace will also be partnering with Amazon to explore Kindle usage in the educational process, with 50 Kindles initially distributed. We talked a bit about the challenges, beginning with getting all concerned actively involved and committed to the idea. He stated that it was possible Pace would help subsidize Kindles for students, and mentioned having done something similar in the early days of laptops to provide them for promising graduate students, as a way of helping them to compete with Columbia University for top talent. He agreed with my feeling that the way Kindles actually got integrated into the education process and used by those involved might only vaguely resemble the notions people have now. (I hope to follow up with Chris at intervals, to track the progress of this project, and see how it does shake out.)

Jay Marino and Charlie Tritschler, Directors of Product Management at Amazon, provided a bit more insight into the changes under the hood. Several things were implied by Jeff's presentation but not specifically stated. One was student collaboration via the Kindle, and an obvious method might be the ability for a Kindle to connect directly to another to exchange data. This is not currently implemented. But the Kindle can do email, and documents can be exchanged that way.

Another was Jeff's comment during the presentation about how your Amazon purchases are backed up on Amazon, and can alwys be re-downloaded. That's splendid for Amazon purchases, but what about other documents? Since one intended use of the Kindle was a business setting, and Amazon is active in "cloud" services, I wondered about the ability to store documents viewed on the Kindle that weren't purchased from Amazon in the user's account with Amazon. That's not currently offered, but was mentioned as something Amazon would look at given sufficient demand.

While PDF compatibility is a notable addition, they specified that the PDF viewer in the Kindle did not do reflow, even if the PDF had the needed tags. This is a little surprising, as the Adobe Mobile Reader SDK supports it, as well as supporting EPUB, which was not mentioned at all. Another limitation is that while annotation is possible on Mobi-formatted documents, the capability is not there for PDFs. This is no surprise, but will present challenges using the Kindle as a textbook viewer, given the student's usual practice of highlighting important passages and writing notes in the margins of paper volumes.

Several folks inquired about color. Charlie Tritschler said that Amazon is certainly aware of the desirability, but at this point, the extant technology doesn't provide results that meet their standards. This was not a surprise. The last I knew, there was experimental 12 bit eInk color support in teh laboratory, and one vendor had announced it in December 2005 with volume production to occur in 2006. It didn't happen, so I assumed problems in ramping up from prototype to production, or costs higher than teh market would support, or both.

I had been informed that all Kindle editions were actually produced by an Amazon unit. Apparently, that's not the case. Jay Marine said that what Amazon does depends upon teh publishers. In some cases, like older books where electronic files don't exist, Amazon may scan and convert ro produce a Kindle edition. In some cases, the publisher might give them electronic files and request Amazon to produce the Kindle format. In some cases, the publisher create their own Kindle editions and supply them to amazon for distribution.

In answer to another question, it was stated that the web browser in the Kindle was the same as the one in the Kindle II, and no updates had taken place there. Someone asked about things like PDF capability being made available for the existingKindle II through a firmware update. This is apparently a possibility, but not something currently planned.

Overall, the presentation was effective, but still left unanswered questions, starting with "What does DX stand for?" One commentator elsewhere said it stood for "Didn't Explain", as in "They didn't explain what DX stood for, they Didn't Explain when it would ship..." A chap attending the presentation from Brazil asked one everyone has - "How many Kindles has Adone sold?" Adobe doesn't release numbers, so who can say? There have a been a couple of analysts who did some interpolation from Adobe's published financial statements to produce guesses, but they are guesses at best.

Another question which only time will answer will be the success of the Kindle as a preferred way to read news. I was grimly amused at Arthur Sulzberger's enthusiasm for the project, and his statement that "with the Washington Post also involved, they were in good company". The current environment is brutal for newspapers, with circulation dropping and ad revenue plummeting. The Times has been losing money, and the company had threatened to shut down the Boston Globe entirely if cost saving agreements with the unions were not achieved. The Times Company has been attempting to sell the Globe with little success, and viewed such agreements as necessary. (The Globe got a last minute reprieve when the Times Company said they would not pull the plug on the Globe on the stated deadline, even though one union was still a holdout. The issue for that union was lifetime job security under current contracts, and a fear that the Times Company would use changes in the agreement to drop the highest paid staffers.)

Perhaps the biggest unanswered question was Amazon's ultimate strategy, given the confusion generated by the recent release of the ability to get Amazon editions on the iPhone.

Some time back, I discussed the differences between Sony and the Sony Reader and Amazon and the Kindle. My feeling was that Sony is a consumer electronics manufacturer, and saw the Reader as a device they could manufacture with a large enough potential market to let them do so profitably. I saw Amazon as a vendor of content, producing a reader to provide something else they could sell content for. Essentially, for Sony, it was about the Reader, whereas for Amazon, it was about the books.

I think that distinction still holds, and reconciles the apparent dichotomy between selling the Kindle and offering for the iPhone. For Amazon, it's about the books. They want to sell ebooks, and sell a lot of them. The iPhone rapidly became an enormously popular product, and a large potential market for Amazon. As a device that is primarily a smartphon, the iPhone isn't a direct competitor to the Kindle, and interested buyers won't buy it instead of a Kindle.

But they will buy books to read on it from Amazon, and for Amazon, it's worthwhile. They have the infrastructure already in place to process the orders. And with electronic books, there isn't the cost and labor involved in warehousing and distribution.

Amazon wants to sell you stuff to read, and they won't just support the Kindle as the place where you can do it. We'll see where this might lead. For instance, the Blackberry Curve was reported to have outsold the iPhone in the most recent quarter. Is the ability to get Amazon ebooks on the Curve something that might occur? I don't know, but I wouldn't bet against it.

Steve Trotter - SVP WW Digital Management

Jan Marine - Director, Product Management

Charlie Tritschler - Director, Product Management

The Kindle DX, displaying a PDF

______
Dennis

[sirbruce]

Originally Posted by DMcCunney

He talked a bit about the Kindle's success, stating that 35% of all books sold by Amazon are now electronic Kindle editions, up from 10% a year ago.

That's not what he said.

What he said earlier was that Kindle ebooks were 10% of ALL book sales. What he said recently was that, IF a book was available in BOTH physical and Kindle form, the Kindle version accounted for 35% of *that* book's total sales. Since not all books have Kindle editions, these two statements are not talking about the same thing.

Edit: Also, you called Jay Marine Dan Marino.

[JSWolf]

I do wish Adobe has made it mandatory that in order to use PDF that they also had to take ePub as well.

[DaleDe]

RTF support is interesting. There is nothing in the literature or manual that indicates that RTF is supported natively on the unit.

Dale