Six universities are partnering with Amazon and major publishers to supply students with Kindles this fall. Will campus crack open the e-book market?
Amazon's Kindle, launched in 2007, hasn't wowed academia. The electronic book reader is too expensive for many college students, the screen is too small and plain for the diagrams and illustrations found in a typical textbook, and book selection is limited since top education publishers have released only a fraction of their titles in a Kindle-friendly format.
Kindle may start getting a warmer reception in colleges come May 6, when Amazon (AMZN) launches what is expected to be a larger version of its Kindle e-book reader that is more suited to academic publishers. Six universities including Case Western, Pace, and Princeton are partnering with Amazon and major publishers to supply students with the new device in the fall, The Wall Street Journal reports. Details of the name of the device, as well as specific features and price, have not been released. Amazon declined to comment on the report.
By entering the nascent market for higher-education e-books, Amazon is attempting to expand the audience for its Kindle platform. Amazon could also use a new device to pursue a slice of the high-volume business of college book sales, valued by the National Assn. of College Stores (NACS) at $5.4 billion in the 2007-08 fiscal year. Amazon's technological possibilities are legion. The Kindle could carry science textbooks that update according to new discoveries, as well as classics that feature Internet links to historical notes and literary criticism.
But for Amazon, success on college campuses won't be an easy A.
A Lower Price Would Help
First, it will need to set prices carefully. College students spend hundreds of dollars each semester on paper textbooks; e-books may shave one-third of that cost, on average, according to NACS. That would ease the pain of buying a device that costs $359—the price of the most recent iteration of the Kindle—but most students would still be hard-pressed to pay that much all at once for a single-purpose device. "With a user base that already has a laptop and a mobile phone, asking Mom and Dad to shell out a few hundred extra dollars is a hurdle," says Mike McGuire, a media analyst at Gartner (IT).
Amazon might find a way to produce a larger device at a lower price point, says NPD Group's Ross Rubin. "An inexpensive e-book reader that could be used to distribute textbooks would crack open the category," he says.
Still, Amazon may have found its most willing customers in the universities that reportedly will partner in the Kindle launch. Case Western and others are subsidizing the cost of the device for at least some of their students, according to reports. But Gartner's McGuire points out that not all schools are going to be able to afford to do the same. And even for those that do, the relationship raises other questions, such as: "Is Amazon going to provide tech support?" asks McGuire.
Size is also a key consideration. The device will need to be large enough to include such elements as graphs, charts, and tables, but not so big that it's hard to carry. "There are spatial limitations" on the current Kindle device, says John Donatich, director of Yale University Press, a publisher that released nearly 1,000 books, including many textbooks, on the Kindle format last year.
A device that's too large won't fit in school bags or on classroom desks. "Obviously, there's a limit to how big you can make the things," says Michael Norris, an analyst at media researcher Simba Information.
Roll It Up? Fold It in Half?
Another size consideration: Amazon is also reported to be partnering with newspaper publishers, including the New York Times Co. (NYT), for the launch of the device. That leads some analysts to believe Amazon will be more creative with the design, such as making a screen that can roll up or fold in half like a newspaper.
Kindle's maker may also need to beef up copyright protection. Book titles for the Kindle carry Digital Rights Management software that limits copying of digital books and bars customers from transferring them to another device. While that's not expected to change, the incentive—and ability—of customers to break the DRM restrictions and illegally share e-books among many friends may be greater in the college market, according to Gartner's McGuire. "I would think there are going to be some fairly significant DRM issues," he says, pointing out that college students possess a higher degree of technical savvy than the typical consumer.
Amazon's head start on campus may not last long. Plastic Logic, Hearst, and News Corp. (NWS) are all expected to debut large-format e-book readers in the next year. Apple (AAPL) is rumored to be unveiling an Internet-ready tablet device this summer.
The right prep now will help Amazon ensure that Kindle gets into college—and stays there.