Parks Associates Blog

Thursday, July 08, 2010

Over 50% of Mobile Internet Devices Sold in 2014 Will Have Embedded Mobile Broadband

Parks Associates forecasts consumer demand for ubiquitous wireless access will make mobile broadband a common feature in portable CE, with 55% of the more than 100 million mobile Internet devices (MIDs) sold worldwide in 2014 containing embedded mobile 3G or faster connectivity.

A new report Mobile Internet Devices: Uptake and Trends finds the majority of consumers consider wireless connectivity a necessity for devices such as e-readers, iPads, and portable game players. As a result, OEMs will incorporate mobile broadband into more devices, and to drive end-user adoption further, they could start to forge partnerships with mobile operators to develop innovative pricing models for mobile data services.

The marriage of mobility and the Internet is creating excellent market opportunities. Connected PMPs, e-book readers, and Internet tablets will account for the majority of sales through 2014.

For more information, visit http://www.parksassociates.com/mobile.

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Monday, June 21, 2010

What a Day for e-Book Reader Market

In a matter of hours, consumers gained at the expenses of e-book reader makers' profit margin. I am talking about the price war initiated by Barnes and Noble this morning on its Nook e-book reader device and the swift action taken by Amazon.com to lower the price of its low-end Kindle. by the end of the day, the entry-level Kindle is $70 lower, from $259 to $189, while a new Wi-Fi only Nook costs $149. Even the price of the 3G Nook was lowered to $199.

I have tracked the portabl CE market for years but the past six months are also an eye-opener for me when it comes to the young mobile Internet device market. First we got a string of CES news of more than half a dozen new e-book reader brands to hit the market this summer. Then came the iPad debut and a new e-book distribution model that changes the game rules set by Amazon.com. The subsequent iPad success sent a clear message to standalone e-book reader makers that they have to adjust their products' market positioning and pricing in order to square off competition from multimedia Internet tablets. The precipitous price cuts by Amazon.com and Barnes & Noble are so far the clearest evidence that the standalone, monochrome e-ink panel-based e-book reading device market is in great danger of being marginized.

Will other device makers follow suit? Irex is already struggling; Plastic Logic's Que is nowhere to be seen; Copia's devices are still just Web descriptions; and Spring Design's $399 Alex reader looks expensive given today's news. Even Sony may have to re-design its e-book reader product line to survive the new competitive environment.

As an analyst, I am already revising my mobile Internet device forecasts in light of the latest developments after publishing a report on this topic in early April. And wait, iPhone 4 is coming up this Thursday, and don't forget that iOS4 now supports e-book reading function on iPhone and iPod Touch. Great! Bookmark and Share

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Friday, March 27, 2009

E-Book Reader, The Paperback of a New Generation

“I have never been much of a reader, but I would like to read more,” is a comment heard ever more frequently at happy hours, professional events and even, as for me, at the office. In my case, as in many others, the conversation centered on the advent of e-readers such as the Amazon Kindle and the Sony Reader Digital Book which, ironically, are using technology to bring this desire to reconnect with the tradition of the written word within the grasp of today’s overscheduled and high access media entertained young professional. “I want to read more,” my coworker explained, “but I just don’t have the time.” In his case the technology under discussion was the Kindle2, which allows for both text-to-speech and page display e-reader functionality – thus giving readers the ability to “listen” on the drive to work to the book they began e-reading while in line at the grocery store.
The technology is impressive and the idea that it may bring literacy for entertainment back into vogue is an exciting concept. But one has to wonder what effect it will have on the publishing industry. Like the paperback novel before it, the e-reader may come to influence what types of materials are commercially published. Prior to the US introduction of the mass market paperback by Robert de Graaf in 1939, the hardcover book was a library or bookstore commodity whose readership did not always include “commuter class” workers; however, fueled by their easy availability at newsstands and the corner drug store, the public’s ravenous appetite for these convenient “pocket books” caused the publishing industry to take a genuine interest in the paperback’s market potential.
The first paperback offerings, just as those for the Sony Digital Book and the Kindle, were previously published works by established authors. Over time, however, owing to the comparative low cost of production, as well as to the often non-traditional tastes of the paperback reading public, some publishers began producing original works and slow selling “sensational” titles in paperback formats designed specifically to appeal to their new readership. Mike Hammer, Mickey Spillane’s hardboiled cult idol, first found fame within the pages of the 1950’s dime store novel.
So now, once more, we are faced with a new innovation that may bring with it a new readership whose tastes differ from that of their pre-e-reader forebears and the question must be asked – what changes will they make even as they embrace the long standing bastion of the written word, and, in the end, who will have the profounder effect on whom?

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The e-Book Market Is Garnering Rising Interest

Amazon.com stays mum about sales of its e-book reader the Kindle. Private sources pegged 2008 unit sales between 300K and 500K. More rosy is the forecast. An equity research analyst projected early this year that Kindle and its content can bring Amazon.com $1.2 billion in 2012.

Whether such forecast is accurate is anyone’s guess. But there is no doubt that electronic books and literatures are an under-monetized asset. This week I learned, in quite a surprise, that Shanda Literature, a subsidiary of China’s largest online game company Shanda Interactive, earned almost 100 million Yuan (equivalent to $14 million) in revenue in 2008. Shanda Literature operates three online Chinese literature communities where users contribute original stories and novels and share with one another. Visitors and community readers can opt to pay to read premium content, and Shanda Literature provides the distribution and payment platform and earn commission from each microtransaction. $14 million might be too small by American standards, but given the fact that Shanda just formerly established the subsidiary eight months ago (the portals were first set up in 2004), and the fact that the $14 million was based on micropayment, I would call Shanda Literature’s accomplishment “impressive.”

Let’s turn back to Amazon.com’s business model with Kindle. Earlier this month, Amazon made available an e-book reader software for Apple’s iPhone. It indicates that Amazon realizes that the Kindle is just half the digital literature market. The more lucrative part longer term might be the content and distribution business. Making e-book reader software available to more devices and platforms is just like Apple made its iTunes software to Windows-based PCs back in 2003. The goal is to expand the application’s reach so as to maximize the potential user base. Amazon will not be content with just distributing books in its physical form. It is reasonable to assume that its ambition is to become a digital publisher and play a commanding role in how e-books/literatures will be published and distributed. It may even distribute user generated content as the e-publishing platform tears down the all the barriers between an unrecognized yet talented writer and the traditional book publishing ecosystem. Since we could vote Kelly Clarkson as our “American Idol,” why we can’t let users vote their “Stephen King” or “Dan Brown” through an e-publishing system?

Perhaps recognizing e-book/e-literature market’s potential, two more collaborations were forged over the last two weeks. Last week, Sony partnered with Google to make the latter’s digital book content available on Sony’s e-book reader devices. Then Barnes & Noble yesterday announced that it will make its own e-book reader software available to RIM’s Blackberrys. Earlier this month, Barnes & Nobles also acquired an e-book seller Fictionwise.com. These deals revealed an intensified interest in the e-book business. As consumers get more accustomed to reading books on a digital device, the book publishing industry could be the next victim of the digital age.

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