Mobile Computing News

Photo: Amazon

It was recently reported that the Amazon Kindle eBooks pricing of $9.99 crumbled due in no small part to Apple. Apple promised publishers it would support an alternative pricing model to Amazon’s that came with a pricing ceiling of $14.99. In doing so, Apple undermined Amazon’s Kindle pricing strategy.The Market-maker Kills the Market-maker.

Amazon, until recently, was the market-maker in this industry, with what is believed to be over 80% of the eBook pie. What they were attempting to do by pricing bestselling eBooks at $9.99 was to  follow on in the footsteps of Apple’s offering of songs on iTunes at $0.99, so as to encourage publishers and users to favour their Kindle device. The long-term goal was the consolidation of power, in an attempt to eventually be the unassailable leader in the digital books business, much like Apple did with iTunes and the music business.

Photo: Apple

Book publishers knew what Apple had done to the record business and were afraid of the same outcome with Amazon at the helm of eBooks. Then Apple appeared on the scene. With an alternative retailer who could in the short term mean loss of income, but in the long term more profits, publishers pushed back against Amazon and made their own prices, with threats to remove content if not adhered to. Amazon balked, the publishers flocked to this new pricing and with that Kindle’s eBook hegemony ended.

Why Did Apple Do This?

Apple is, in Steve Jobs’ own words, the “world’s largest mobile devices company“, so their goal is to sell portable devices. The iBook store, to this effect, is a mere means of selling more iPads. This, if one remembers, is the same for iTunes, which has been a vehicle for selling iPods. Amazon, on the other hand, is a retailer whose Kindle business is to sell content. Thus, Apple’s willingness to cannibalize content – at a decent profit, mind you – in the interest of selling more mobile devices butted heads with Amazon’s content-focused business.

Where to for Amazon

Amazon’s response in the coming weeks will be telling. They’ve acquired a start-up touchscreen technology company, meaning that the Kindle Touch is an inevitable development. Even then, what are the competitive advantages of a touchscreen device that does one thing, compared to the flexibility of the iPad? One cannot rule Amazon out, though, considering they revolutionized not just an industry but how people shop altogether with their online store. The difference, this time, is that they’re up against a strong competitor.

As for the publishers, they would do well to question if Apple is really the solution they think it is.

The upcoming Blackberry Bold gets an all new musical companion with Apple iTunes. It is the first RIM (Research in Motion) phone which enables an Apple’s digital media player application. The player also syncs music through the iTunes. By supporting the Windows Live Services, RIM made easy messaging and e-mail accessing easier. Blackberry Bold becomes the first non-Apple device that supports compatibility with Apple iTunes.

This feature is only available on this version of Blackberry, because of a Blackberry Media Sync. This tool enables the purchased iTunes to work on your Blackberry 9000 Bold with the inbuilt speakers that offer an even better sound quality than you will get from the iPhone speakers. iTunes still functions in the same manner, where you have to purchase music first before downloading. Could this be a development that will help the Bold rival the iPhone? Possibly, however, the iPhone’s strengths are more than just iTunes. Nevertheless it is definitely an interesting and positive development for the Blackberry Bold.

A changing sales procedure prevents buying without a contract. It was previously only sensible to unlock iPhones if the buyer could procure the mobile phone without completing a contract. According to recent rumours, this sales practice is now going to be changed: now unlocking the iPhone is really only something to do for fun.

Apple wants to change their sales methods. The device is not to be handed out, at least in the US and UK, without a simultaneous contract signing. Apple’s partner in the US is AT&T, and O2 in the UK. O2’s webpage states that the iPhone has to be activated at home using iTunes.

According to rumours, the new activation system should begin at the same time as the iPhone 3G’s market introduction. If the customers buy their iPhone in an AT&T shop, then the activation must take place immediately in the shop. On the other hand, when purchasing the mobile at the Apple Store it can also be activated at home via iTunes. Of course no one will receive the device in the first place, without first signing the contract.