Business

Amazon dominates global e-reading market

Lloyd Gedye

It's been less than five years since Amazon launched its first Kindle and already e-books are outselling hardcover books in the United States market.

Amazon is holding pole position in terms of the e-book market. (AFP)

In the first quarter of 2012, $282-million was spent on e-books in the US (a 28% increase year on year) compared with the $230-million spent on hardcovers.

Information technology analyst firm Gartner reported that there were 11-million e-readers being used globally in 2011. Gartner predicted that this figure would rise to 16.3-million by the end of this year, a 48% increase.

Of this market, Amazon's Kindle enjoys a share of nearly 60%, Barnes and Nobles’ Nook holds a 25% share and Rakuten’s Kobo hangs in with a 10% share.

But what about South Africa? Last week, electronics company Circuit City launched the new Kindle Touch 3G devices, two weeks before it reaches the United Kingdom.

The new device, the most advanced Kindle yet, has a touchscreen and free 3G wireless connection across 130 countries. This means one can be in any of these countries and within a minute download any book to the Kindle, as long as one pays for it, of course. No more searching for a wi-fi hot spot.

The device retails in South Africa for R2 699. An entry-level Kindle costs R1 499 and a Kindle Touch with wi-fi but no 3G costs R1 999.

The Kindle Touch 3G can store as many as 3 000 books and has a battery life of up to two months on a single charge.

Circuit City’s Steve Nossel said the company sold between 60 000 and 70 000 Kindles a year in South Africa.

On the international front, Barnes and Noble is planning to launch its Nook in the United Kingdom later this year, using a US$300-million investment from Microsoft. However, the sales of the Nook have started to level out in the US.

Kindle has been in the UK for two years and has first-mover advantage. The Kobo has been launched there too, but Amazon is also holding pole position in terms of the e-book market.

Recently, the website paidcontent.org tried to quantify Amazon’s market revenue share in the e-reader and e-books markets, because the company does not report these markets separately and also reports content for physical and digital sales together.

Paid Content suggests that Amazon’s digital-content revenue could be as high as $1.39-billion for the last financial year compared with Barnes and Nobles’s $463-million.


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