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Amazon cuts Kindle price in response to iPad

The iPad effect strikes book giant

By John E Dunn, TechWorld
June 22, 2010 09:52 AM ET

TechWorld - Amazon has suddenly chopped a hefty $70 off the price of its Kindle eBook reader and Apple's iPad is getting the credit.

The Kindle with a 6-inch screen now costs $189 (£125), down from $259 (£175), while large US book seller Barnes & Noble has matched the move with a drop in the price of its Nook eBook reader from $259 to $199. The company will also now sell the Nook in a WiFi-only version at $149.

Although eBook readers retain some advantages over consuming books using the iPad - they use high-contrast e-ink for a start - it would only require a percentage of users to change their reading device for the business model of Amazon and other device companies to come under stress.

In April, Goldman Sachs's predicted that Apple's share of the eBook market in the US would rise to around a third while Amazon's would plunge to 28 percent from its current 50 percent share.

The real money lies in sales of eBooks so the device is only a shop window for Amazon.

Given that the Kindle is only available to UK users as a shipment from the US, priced in dollars, some might argue that Amazon is not entirely serious about developing the market for eBooks beyond US shores. With the iPad now a hot seller in every developed market that policy now looks like a mistake.

Meanwhile, away from the devices, eBooks themselves are an uncertain medium, beset by uncertainties over formats, licensing and copy protection.

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