The Amazon Kindle is still out-and-out the best-selling ebook reader in the world. If you have plans of purchasing the Kindle 3 anytime soon, the general consensus is you should sit tight for a little, because the Amazon Kindle 4 is around the corner.

Refurb price drop the give away

The online retailer turned hardware and software maker recently dropped the price of both the refurbished Kindle Wi-Fi only, as well as the 3G version. Slashgear’s Chris Davies got wind of it first, reporting: ‘Amazon’s rumored Kindle refresh could be fast incoming, with the retailer seemingly clearing inventory of the existing third-gen model with a refurb price cut. Having been roughly $10 cheaper than new models since March, this week Amazon slashed refurbished Kindles down to $99.99 for the WiFi version and $129.99 for the 3G version.’

So what will replace the Kindle 3?

Rumours in the ebook reader industry suggest that the Amazon Kindle 4 will come in two varieties, beyond merely offering a version of the e-reader with Wi-Fi and one with 3G support, too.

The chatter suggest that Amazon will have a high-end touchscreen-only model – ditching the keyboards found on all Kindles prior – as well as a cheaper model that keeps basic e-reading functionality and that will be marketed at students.

Changing gears

The Amazon Kindle 4 models arrive at a time when the online retailer prepares its own tablet PCs to compete with Apple’s insanely popular iPad devices. With the original Kindle being Amazon’s first foray into hardware manufacturing and distribution being a roaring success, both in terms of consumer response and device quality, it will be interesting to see if the company can develop a device that can compete – and perhaps even best – Apple’s tablet PC.

Having said that, unless you’re extremely anxious to purchase one of many affordable e-readers on the market, it may be in your best interest to hold off purchasing a new Kindle just yet.

With the rise of digital books, e-readers and tablet PCs having a marked impact on the publishing industry and how people consume information, we’re keenly interested in consumer research in this field. A new study suggests that college students would give up sex for digital textbooks, they are that tired of lugging around heavy backpacks.

Giving up action for digital books

When asked if they preferred having sex or the right to carry digital books, 70 per cent of the students surveyed said they would rather have digital textbooks. What’s more a full 25 per cent of these students said they would willingly go celibate if it meant they could have all their textbooks in a digital reading device, instead of weighing down their backpacks and damaging their backs.

Come on, seriously?

The study was conducted by Kno, a company that once made a dedicated tablet PC for students, later abandoning the idea to focus on publishing digital textbooks for tablet devices. Given that the outcome certainly suits the firm’s ambitions, it’s easy to look at the results with a sceptical eye.

Having said that, the survey had a small sample size of just 506 students. In addition to giving up sex for a year, these very same students said they would live on macaroni and cheese for a month, or stop going out and partying for an entire semester just to have digital textbooks. Unlikely.

Basically, this is a case of overstating what one wants – or would give up – for something else they do, in fact, want. Pure pinch of salt stuff – think back to the halcyon days of college and ask yourself if you hated carrying textbooks that much you would give up sex.

Still, there’s something here

Having said that, anecdotal evidence in this survey is still very important. Firstly, digital readers will become increasingly important for academia in coming years. Secondly, textbook makers would do well to offer their publications in digital form as soon as they can, so as to control the transition now, as opposed to being forced unwillingly and unexpectedly to make the switch at a later stage.

The New York Times has just reported that, while the Amazon Kindle e-reader continues to dominate in overall sales of digital readers and digital books, there is one area where Barnes & Noble’s Nook Color e-reader is dominating – and that is in the sales of women’s magazines.

More popular with women

Women’s magazine publishers are reportedly seeing great success on the Barnes & Noble Nook Color, with females preferring to read on that device than on either the Kindle or the iPad.

As unintuitive as that may be, The Times’ almost juvenile reason for this is that the Nook is a ‘simpler’ device to work with.

We’re pleasantly surprised

Liz Schimel, who is the executive VP for digital media at Meredith, publishers of Better Homes and Gardens, Family Circle and a few other women’s magazines, was extremely pleased with the results they’ve seen.

Speaking to NYT, she says: ‘We didn’t really know what to expect.’ We regarded it as sort of a test. Would the Nook magazine experience resonate with consumers? We were extremely pleasantly surprised. I think Barnes & Noble has been very smart about creating a whole brand and a campaign that’s really targeted at their core mass audience which overlaps nicely with our audience.’

iPad capabilities, Kindle simplicity

With the Nook having a colour screen like the iPad, as well as having portability like the Amazon Kindle, the device strikes a perfect balance, making it suitable as a digital reader for magazines.

Segment, think, segment

For manufacturers of digital readers – and even tablet PCs to some extent – this is certainly food for thought. It’s business 101, really, in that if you cannot win an entire device category, securing a segment of a category may be sufficient for wracking up some sales.

It’s also further evidence that one should look at digital publishing and digital books beyond just novels and hardbacks. In this regard, what Kno was trying with building a tablet PC with a focus on textbooks and students was well informed.

We’ll see what more the Barnes & Noble Nook Color will do to compete against the likes of the iPad and the Kindle.

When the Amazon Kindle was released, it would be a lie to suggest anybody could have predicted it would be the runaway success it has been. It’s the best-selling ebook reader in the world by a long way, with a reported 8 million units sold in 2010 alone. What the whole platform is worth has been previously unknown. That’s until now, though, if we can believe an analyst’s prediction that the Amazon Kindle platform will generate revenue of $5.42 billion (£3.32b) in 2011 alone.

Big money

Sandeep Aggarwal, an analyst with Caris and Co., sent out a note saying the sheer depth of the Kindle’s ebooks and its fast-growing installed base would mean that it would be one of Amazon’s biggest money-spinners in 2011.

Aggarwal writes: ‘Since mid-2009, competition in the eBook market has been intensifying but, in our view, Kindle remains the most compelling eBook device and a material contributor to Amazon’s non-core business growth. In our view, in 2011 Kindle can generate revenue in excess of $5.42 billion and $1.21 billion in gross profit; by 2012 we expect at least $7.96 billion in total revenue and $2 billion in gross profit.’

Too bullish to be true?

As bullish as this estimation sounds, a quick look at a few Kindle stats makes it seem quite believable. Book titles on the platform totaled 945,026 in May 2011, an increase of 47,000 (about 5 per cent) over the count in April 2011, showing that publishers are backing the platform. If consumers follow in-step, as they have been, the estimated revenue figures do not sound at all ridiculous.

This is good

Caris and Co. also back the Amazon Kindle platform because, on its accounts, it’s superior to the traditional book publishing model in several ways. Aggarwal writes: ‘We think that Kindle not only helps to remove multiple costs and inefficiencies in the traditional book printing and distribution business (e.g. print and fulfillment costs, back order risk, and inventory management) but also increases propensity to buy books/content and other adjacent products due to convenience and 24/7 access.’

We think the same can be said for the ebook reader market.

Soon Amazon Kindle users in the US will be able to borrow ebooks from libraries. Amazon is teaming up with Overdrive, a global distributor of ebooks and audio books, which already offers ebook lending at 11,000 libraries in America.

How it works

Up until now Kindle users have been unable to download certain titles because of the device’s unique file format. But Amazon’s latest initiative will see borrowed library books being available on any device with Kindle software, including Android tablets and iPads.

All that’s needed to start using the service is to belong to a local library. Books can be downloaded via the library’s website and they’ll be available on loan for up to three weeks.

‘No innovation here’

Overdrive, which has been in business for several years now, offers readers with devices that use the e-pub file format hundreds of thousands of books. Amazon has its own version of e-pub with a digital rights management system to prevent copying. The fact that Overdrive is adopting Amazon’s format has been welcomed by some, but left others rather underwhelmed.

‘There is no innovation here. It is like congratulating Channel 5 for broadcasting their pictures in colour when everyone else has been doing it for years,’ says Martin Hoscik of eBook Magazine.

Good news for libraries

Nevertheless it’s thought that the Kindle’s dominant position in the e-reader space will raise the profile of library lending.

‘I am in favour of anything that gives readers an opportunity to read more books via a library system,’ Phil Bradley, vice president of the Chartered Institute of Library and Information Professionals, said.

What about the UK?

Overdrive operates in the UK with 33 of Britain’s 151 libraries making use of the system at present. But Amazon hasn’t confirmed whether Britain is included in this new library lending scheme.

Barnes & Noble, the venerable US books retailer that launched the surprisingly successful Barnes & Noble Nook ebooks reader, is making a bigger play for mobile devices. The company has announced that it is opening up its platform, which runs on Google’s Android mobile OS, so app developers can make applications for it.

How it will work

Barnes & Noble has recently released development tools for Android devs looking to make apps for the ebooks reader. These will retail on B&N’s own store with devs keeping 70 per cent of revenue generated via the store, and B&N keeping the remaining 30 per cent. Free apps will be permitted, too, as well as trial versions of applications for the Android e-reader.

Rollout strategy

The Barnes & Noble Nook store is expected to arrive side-by-side with the next major update to the device, which is scheduled for spring. Devs interested in making apps are encouraged to apply with B&N, with the chosen few getting the development tools and other information early. The store will be moderated – much like the App store, with B&N screening submitted apps.

How things come around

When the iPad’s arrival ushered in the tablet PC era, many predicted it may be the death of the e-reader. This has not been the case, with ebook readers since going from strength to strength. Nevertheless the argument was that tablet PCs could function as e-readers, while doing so much more. The joke now is that the Barnes & Noble nook, which was supposed to be a digital reader and nothing more is actually becoming more.

Nevertheless, at this stage it’s difficult to say whether this is a good play by Barnes & Noble. The Nook can never out-Android a dedicated Android Honeycomb tablet or even a top-end Android smartphone, so where will it fit in? It’s an awkward space, really.

Microsoft Corp has sued American Book retail chain Barnes & Noble for patent infringement regarding the Android technology running in B&N’s Nook ebook reader. This, for those keeping score, is yet another Android-related lawsuit Microsoft is involved in, after suing Motorola for aspects of their Android handsets.

No, you can’t have a tab!

The patent infringement lawsuit sees the software titan accusing the Barnes & Noble Nook ebook reader of infringing several of its patents, including the software that is used for tabbing between screens, surfing the web and interacting with the ebooks themselves. In total MS alleges the B&N Nook infringes on five patents, which concern how the device displays retrieved images, the status of downloads on a small display, the editing of electronic documents, as well as how it renders notations.

You’re not alone

While Microsoft suing Barnes & Noble is undoubtedly the headline, Foxconn International Holding Ltd – who own the company that manufactures iPhones – and Inventec Corp, have also been hit with patent infringement suits.

Speaking on these patent infringement lawsuits, Microsoft’s deputy general counsel of intellectual property and licensing, Horacio Gutierrez said: ‘The Android platform infringes a number of Microsoft’s patents, and companies manufacturing and shipping Android devices must respect our intellectual property rights.’ He continued, saying: ‘We have tried for over a year to reach licensing agreements with Barnes & Noble, Foxconn and Inventec. Their refusals to take licenses leave us no choice but to bring legal action to defend our innovations.’

Order of the day in smartphones, not so much in e-readers

While lawsuits in the smartphone space are plentiful, there’s been virtually no legal activity in the ebook readers market. Given Android is predominantly a smartphone platform, we can consider the Barnes & Noble Nook suit here straddling the line somewhat.

The e-reader space is one in which Microsoft is not currently competing. And as perennial nemeses Apple and Amazon juke it out with their iBooks and Kindle platforms respectfully, Microsoft has stood to the side and, for the most part, just watched. Whether suing Barnes & Noble is a warning shot at Google, a legitimate case of patent infringement on B&N’s part, or an early sign MS is keenly looking into the space remains to be seen.

As if the world needed any more proof that eBooks were here to stay, Amazon has announced that its Kindle eBooks have now become the most popular format on the site, overtaking even paperbacks.

Surely this is the tipping point

This, however, is not the first time digital books sales on Amazon have outstripped that of physical books, considering the online retailer last year announced it sold 143 Kindle books for every 100 hard cover sold. Now, though, seeing 115 Kindle books sold to each 100 paperbacks – which are comparably much cheaper than hard covers – is certainly something worth celebrating and even boasting about.

Incidentally, the gap between hardcovers and Amazon Kindle eBooks has only been increasing, with three eBooks being sold to every hardcover on Amazon.com.

You were wrong, Mr. Bezos!

One thing about the Kindle eBooks sales that has not gone to Amazon’s plans is when this physical to digital divide would be crossed. Amazon’s CEO, Jeff Bezos, predicted that this would only happen in Q2 of this year, and he’s off by a full two months. Strangely, I don’t think the man minds too much that this is so, given how big a piece of the eBook pie Amazon owns.

Riding the wave

Amazon is currently riding the eBook reader wave all the way to the bank, with the company dominating the digital reader sector in much the same way Apple’s iPad is dominating the tablet PC market.

In fact, we bring up the iPad deliberately because many said that it would eat the Amazon Kindle e-reader for breakfast. On all indications, this has not happened, with Amazon selling a rumoured 8 million Kindles prior to Christmas last year, and with the online retailer announcing the Kindle was its best selling product on Amazon. Ever.

Furthermore, though it’s easy to think other eBook readers are struggling to survive due to Amazon’s dominance, there’s equal argument that the market for digital books wouldn’t be as advanced as it is if it weren’t for Amazon. That in itself is reason enough to be quite optimistic about eBooks and the whole eBook readers market.

We all know that the iPad is the world’s number one tablet, and the Kindle is the world’s number one e-reader. What many do not know is how intense that dominance actually is, with an IDC report showing the iPad virtually is the tablet PC market, and the Amazon Kindle has stretched its legs from the competition.

Nearly nine in 10 tablets is an iPad

The IDC report states that the iPad owned a mind blowing 87.4 per cent of the entire tablet PC market in Q3 of 2010. That’s just shy of nine in every 10 tablets being made being Apple’s.

However, since Q3, there have been many more tablets announced and released, meaning that the market share will inevitably decline. In fact, given that Apple’s Q1 2011 report shows the company moved 7.33 million units, and the number two tablet PC, the Samsung Galaxy Tab, moved close on two million units in the same period, the iPad market share has already begun to drop.

You can’t Kindle this

The counterpart to Apple’s tablet dominance is the Amazon Kindle e-reader, with the IDC report saying Kindle owns 41.5 per cent of the digital reader market. Given that Amazon supposedly sold 8 million of its e-ink devices, that dominance is of no surprise. What is a surprise is the company coming in close second – Pandigital, who make the Novel coloured-screen reader currently only available in the US. Intuition would have told me Sony would be second. Intuition would have been wrong.

2011, the year of the tablet PC

The IDC report also echoes what is widely believed – that 2011 will be the year of the tablet PC. The research firm expects 44.6 million slate PCs sold this year, in comparison to the estimated 17 million sold in 2011.

As for e-readers, the group expects 14.7 million sold in 2011, compared to 10.8 million moved in 2010. Which is mathematically odd, if there were in fact 8 million Amazon Kindle devices sold last year, meaning Amazon should either have closer to 80 per cent market share, or the IDC report needs to adjust overall sales upwards.

A massive spike in Christmas sales has seen the Amazon Kindle 3 become the online retailers best selling product. And no, not just best-selling product this year, but rather best selling product ever. It’s also given the Amazon team reason to coo as they successfully stave off the threat of tablet devices.

Sorry, Harry

The Amazon Kindle 3 has now overtaken  Harry Potter and The Deathly Hallows book release as the retailers best selling product ever. A big contributor to this massive sale spike is how aggressively the Kindle 3 is currently priced, available at as low a price as £109 here in the UK.

Even though we now know it is Amazon’s best selling product ever, we still don’t have hard sales numbers, though analyst consensus put its number at 8 million Kindles sold across all models just prior to Christmas, so it could have leapt significantly since.

Not Kindle vs iPad, Kindle and iPad

What’s more, Amazon’s team believes that the aggressive pricing of their eBook reader has meant that consumers have realised that they do not have to choose either a tablet PC or an e-reader, with many snapping up both. CEO Jeff Bezos said (via TechRadar): ‘We’re seeing that many of the people who are buying Kindles also own an LCD tablet’ – information he no doubt has access to since Amazon likely sold the tablet to the customer.

He continues, saying that: ‘Customers report using their LCD tablets for games, movies and web browsing and their Kindles for reading sessions.’ It makes sense, since in pure reading stakes, dedicated e-ink eBook readers are considered superior devices.

Kindle platform pushed on

Even with this seeming co-existence between the Amazon Kindle 3 and tablet PCs, the online retailer is not taking any chances by continually proliferating the platform to other devices, including Apple’s popular iPad tablet PC. The long and short of it is this: Kindle is not being killed by anything at the moment, and this is hard evidence that when priced correctly, tablet PCs and eBook readers can co-exist.