June 14, 2010
Apple's (Nasdaq: AAPL ) iPad has racked up huge sales and generated plenty of speculation that it will kill off Amazon's (Nasdaq: AMZN ) Kindle. I recently asked Fool contributor Tim Beyers about the relative advantages of the iPad and Kindle.
Mac Greer: What's the biggest advantage that the Kindle has on the iPad?
Tim Beyers: The biggest advantage that the Kindle has is scale. Publishers still see Amazon as the king, and that's not going to change. Apple has a long way to go to overcome Amazon's volume lead in terms of books, in terms of content yields. It's not like Apple won't strike great deals with publishers. But they're way behind Amazon in terms of doing deals with publishers. And I think the competition is going to heat up. Ultimately, I think that benefits publishers, because if Apple and Amazon knock heads, maybe publishers get some favorable terms. And you know, this is one of those things where users just get more access to more great content; and that's great for users. But at the same time, I don't really think it's a foregone conclusion that Apple takes over this market. The publisher relationships still belong to Amazon.
Mac Greer: What's the iPad's biggest advantage over the Kindle?
Tim Beyers: The biggest advantage that the iPad has is flexibility. The iPad is a great device. Now that it's out and consumers love it, there's really almost no interest in buying a brand-new piece of Kindle hardware, and the iPad has proven to be that good. And I admit, I was a skeptic on this. I thought of the iPad as a large iPod Touch, and I wasn't certain that it was going to knock the Kindle off its perch. Now, in terms of hardware, it does look like the iPad is the device to beat. And some of the research suggests that people not only love it for the hardware, but they love it for apps. And even more important, they love it for newspapers and magazines. That's a really big advantage for Apple. So as much as Amazon has the book publishers in its corner, very quickly Apple could find the newspaper and magazine publishers in its corner, and that makes this battle very interesting.