Famous Last Words: The Tricky Business of Setting Prices
After much hype and media buzz, Amazon.com released the first generation Kindle e-reader on Nov. 19, 2007, for $399. It reportedly sold out within 5.5 hours. I wanted one badly, but the thing was 1) untested in the marketplace and 2) pricey.
The following May, I saw a presentation by Jeff Bezos at BookExpo America in Los Angeles. Bezos had a Kindle, as did three or four Amazon employees. But only two were available for inspection at the Amazon booth. Amazon couldn't keep it in stock.
The Kindle was hot, and I was hooked. In addition, as I recall, the price had dropped to $299. I bought one in 2008 as a birthday present to myself, and as of this writing, I have bought 48 books for my Kindle. I adore it!
In the years since Kindle was launched, Amazon, which claims to own 70 percent to 80 percent of the e-reader market, is mixing it up in a marketing mêlée with Apple's iPad, the Sony Reader, Barnes & Noble's Nook and others. Amazon has dropped the price to a minuscule $139.
Should I have waited until the price came down, as it does with most electronic gadgetry? Nah. I had the joy of reading roughly $1,200 worth of books (the hardcover cost) for around $400 (Kindle cost) and I did not have the damned things cluttering up my 16-foot-wide Philadelphia row house.
The Perception of Value
What is curious is that book publishers operate in a 19th century mindset and do not know what to make of e-readers. I heard some TV commentators talking about the book "Game Change"—a riveting saga of the 2008 election. I immediately shopped the Kindle store and discovered the publisher had kept the title from e-publishers, fearing they would cannibalize sales of the hardcover edition. Did the publisher really think a guy who spent $299 for an e-reader was going to spend $27.99 on a clunky hardcover book and schlepp it around the house, or on an airplane or cruise ship? I found another book to purchase.