Photo: Colony of Gamers / Flickr

Struggling US book store chain Barnes & Noble hosted a special event to unveil its latest B&N Nook – a colour eBooks Reader. And while the chain thought it would set the e-readers market alight, it’s actually likely it has committed premature suicide in that space. Below is an explanation of why we think they’ve killed themselves in the space and how others can ensure they don’t make the exact same mistakes.

A colour e-reader is just a bad iPad

The problem with the new Android-powered B&N Nook Color is that Barnes & Noble essentially turned its back on the only thing keeping e-readers relevant in a post-iPad world – e-ink. E-ink is easier to read over long stretches of time, is very light on the battery, and works great in direct sunlight. In short, for pure reading, it’s superior to a tablet screen any day of the week.

When you add a colour screen into the mix, as the B&N Nook Color has done, with the ability to read magazines and a very basic build of Google Android as the OS, you no longer have an e-reader on your hands but rather a truly cheap tablet PC – and an awful one at that.

E-readers that have not committed suicide

If anything, this represents B&N’s hubris, arrogance, greed, or even ambivalence. Why this would work when the number one eBooks reader in the world by a country mile – the Amazon Kindle – has realised e-ink is the way to keep ploughing forward, is bemusing at best. Even the likes of Sony, who have a reasonable foothold in the eBooks reader market, have stuck to e-ink with their revised product range. The point, essentially, is, e-readers need to have the superior reading display, even if it is an inferior display in other areas, since this is the lifeblood of the platform.

Learn from this, manufacturers – but we don’t doubt you already have. And consumers, don’t be fooled by colour e-readers. If you want a digital device to read material on, stick to e-ink devices. The minute the device goes colour, it just becomes a poor man’s tablet. The B&N Nook Color is a poor man’s tablet.

Photo: Amazon

So much for claims that the stand-alone ebook reader is on deathwatch, with worldwide shipments of the e-reader exceeding 740,000. The Barnes & Noble Nook leads in numbers with the Amazon Kindle trailing in second.

Barnes & Noble’s

Before confusing what these ‘shipments’ represent, it is important to note that Digitimes Research isn’t talking about sales from retailers to customers, but rather from suppliers to retailers. Of the 740,000, Barnes & Noble shipped 37 per cent while the Amazon Kindle shipments accounting for only 16 per cent, according to the research firm. This figure does not include the iPad.

The swell in B&N Nook sales is as a result of the massive retail chain Barnes & Noble has, being North America’s largest books store chain, coupled with a heavy marketing push behind the device. The reason for the seeming lack in Amazon Kindle numbers is, according to Digitimes Research, in line with expectations that Amazon is reducing inventory in anticipation of a newer Kindle device due sometime in July or August.

Downward pressure on prices

Photo: Amazon

In related news, Barnes & Noble has dropped the price of its B&N Nook e-reader in the US, while also introducing a new cheaper model. The price of the e-reader with wi-fi and 3G (the original Nook) is now $199 (about £135), a $60 drop from its original price tag of $259 (about £212). The new model, which drops 3G for wi-fi only support, costs $150, radically undercutting the price of most ebook reader devices on the market at present.

This aggressive pricing regime may be the first step towards what some have called the ‘paperback’ ebook reader – a super cheap eBook to get the device into many people’s hands so as to use the platform as a content delivery service. Considering the B&N Nook is tethered to the B&N store, as is the Amazon Kindle to the Kindle store, this approach to pushing volume at tiny margins makes sense if you have engaged customers to always sell content to.

A shipment of 740,000 across the industry in over two months is certainly no run-away success, but it does prove a viable business model no less.