Amazon.com's (Nasdaq: AMZN) Kindle bookstore introduced a new multimedia feature yesterday. Authors now have the ability to embed video and audio clips into their digital reads.
The early incorporations are encouraging. A travel guide now has walking-tour clips. A cookbook has recipe videos. A birdsong primer offers actual audio examples of birdcalls.
There's a catch, of course. This update isn't part of Amazon's actual Kindle e-reader. It's an upgrade to the Kindle's Apple (Nasdaq: AAPL) App Store program for iPad, iPhone, and iPod touch owners.
What did you expect? Richly detailed videos through the Kindle's graphically challenged grayscale screen? Audio enhancements are certainly possible, but video? Not a chance, my little e-bibliophile.
Now that Amazon's Kindle app is officially available through smartphones powered by Google's (Nasdaq: GOOG) Android platform, it's easy to see the country's leading online retailer throwing more weight behind its digital bookstore.
But will that support come at the expense of the Kindle itself?
When Amazon was selling its Kindle at $399, $359, $299, and even $259, it made perfect sense for Amazon to take a hit on $9.99 digital books in order to move more readers. However, since last week's price war -- when Barnes & Noble (NYSE: BKS) slashed the price of its 3G Nook to $199, and Amazon cut Kindles to $189 mere hours later -- it appears that Amazon is ready to aggressively market its virtual reads instead. As the industry gradually moves toward the higher-priced agency model for e-book pricing, the books themselves are becoming the real moneymaker.
The price war must have taken Amazon by surprise. I had to chuckle at Target's (NYSE: TGT) circular over the weekend, pitching $259 Kindle readers six days after Amazon's knee-jerk reaction. Clearly, the price cut wasn't orchestrated or rehearsed -- it was pure desperation.
Will Amazon really spend the next few years slugging it out with Barnes & Noble, Sony (NYSE: SNE), and countless small fry in the hardware space, while Apple's more versatile iPad and an onslaught of cheaper tablets steamroll the e-book reader market? I acknowledge the advantages of e-Ink over tablet glare, but its graphical -- and multimedia -- limitations are all too real when compared with the iPad's glossy, full-color screen.
How long will Amazon continue to make the Kindle? Right now, it's selling 13 enhanced books to Apple customers at the same prices for the regular versions that it's peddling to Kindle owners. If Amazon can gain a technological advantage in electronic books -- a big if, since it seemed that this would be just another commoditized media free-for-all until Amazon raised the stakes this week -- the e-tailer could ditch its hardware commitment and never look back
Now that Amazon's putting out a better product for the non-Kindle owning crowd, its proprietary reader's days have to be numbered.
Will your next gadget purchase be a Nook, a Kindle, or an iPad? Share your thoughts in the comment box below.
