Scott Marlowe, fantasy author

Scott Marlowe

Author of the Alchemancer and Assassin Without a Name fantasy series

Amazon cuts Kindle price to $189

Kindle Today cut the price of their Kindle eReader from $259 to $189. The last price cut for the device was in October of last year. Barnes & Noble prompted Amazon's price cut with one of their own as they lowered the price on their popular nook eReader while also introducing a wi-fi only model.

I think most people have been expecting this move since late last year when Barnes & Noble released their competing eReader, the nook, and especially now that Apple's iPad has proven itself a viable contender (and more depending on who you ask) in the eReader space.

I received my Kindle as a Christmas gift last year. My first impressions were favorable. As far as dedicated devices go, it's top-notch. I wouldn't want to have waited for this price drop, either. I've read about an eBook per week since turning the device on, so I think I've gotten some good use out of it. Of course, for someone new to the device, a lower price justifies the purchase that much more.

Back in April of 2009, iSuppli opened up a Kindle 2, identified the parts, and, based on their findings, figured out what the device really costs. Their finding: $185.49. I'm going to guess that component and manufacturing costs have since come down because otherwise that leaves Amazon with a paltry profit of $3.51.

The last point I want to make about this latest price reduction is to ask the question once more: Is now the time to buy a Kindle? No doubt, it makes the idea more compelling. But times have changed. There are viable competitors out there, including a just announced version of the nook with wi-fi only for $149. Apple's iPad is still hovering at $499, though the iPad is much more than just an eReader.

In any case, competition is always good from a consumer perspective; it drives prices down and hastens new development. For me, I still just need an eReader device, but it's nice to know prices are coming down while functionality continues to climb to new heights.


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Amazon Kindle: Now, is the price right?

Amazon cut the price on their Kindle digital e-book reader again. This marks the second price cut of the year so far (the previous cut was $60). With Christmas rapidly approaching, and more digital readers hitting the market all the time (now, Barnes & Noble is going to sell one), one wonders if we won't see another price cut—or possible holiday price reductions—before the year is out.

As it stands now, here's the current breakdown of Kindle models and prices:


The $259 and $279 Kindle differ only in that the latter allows one to download e-books when traveling abroad (outside the United States). The Kindle DX is the deluxe, super-sized Kindle, with a larger reading screen and more memory. Scott Hanselman, a technologist whom I follow on Twitter and whose blog and podcast I read and listen to regularly, has a nice post up about the differences between the Kindle and the Kindle DX if you'd like to read more on that.

Given this most recent price reduction, I'd like to dig up an older post of mine, How much does the Kindle 2 really cost?, where I cited an article where the author ran through a cost-justification of the Kindle 2. The author makes a comparison between buying a Kindle and accompanying e-books (at a rate of 2 per month) vs... buying the same number of traditional paperbacks.

So, buying paperbacks:

I could get free shipping if I ordered two paperbacks at a time and didn't mind waiting five to nine business days for them to ship. If I chose standard shipping (three business days) instead, I'd pay about $4.88 for two paperbacks mailed together. I wouldn't be charged tax. (I live in San Francisco. How much you pay in shipping or taxes depends on where you live.) The $4.88 shipping for two books a month would equal $58.56 a year. That brings my two-paperback-a-month habit (books + shipping) to $447.12 per year.

Versus buying the Kindle (remember, the cited price of the reader does not include the recent price cut, nor does it include the price cut of $60 from three months ago):

My Kindle 2 order totaled $365.98, which includes $359 for the e-book reader and $6.98 for three-business-day shipping. The average price of the top 10 Amazon Kindle nonfiction bestsellers is $9.78. If I bought two e-books per month, I'd spend $19.56 per month or $234.72 a year (shipping isn't necessary). My grand total for the year: $600.70, which includes the Kindle 2 and 24 e-books.

That gives us $447 vs.. $600. A $153 difference. If you extrapolate this out to 2 years as the author of the article does (excluding the cost of the Kindle on the second year, of course), those figures go to $894 and $835. By buying the Kindle (at yesterday's prices) you wind up saving $59.

Now, let's look at that in light of the recent Kindle price reduction.

The first scenario obviously doesn't change, so our annual price of buying 2 paperbacks/month remains at $447.

The first year Kindle price plus e-books, however, goes down to $500 (Kindle: $259; s/h: $6.98; e-books: $234.72) from $600.

That makes for a 1 year difference of $53 in favor of buying traditional books (much better than the initial figure of $153). Over 2 years, however, we have $894 for traditional books and $734, a difference in favor of the Kindle of $160. Before the price reduction, that savings for 2 years of Kindle ownership was $59.

Given all of that, the question is this: Is now the time to buy a Kindle?

I think not.

While I think the long term cost savings begin to warrant the cost of the device, I'm willing to wait just a little bit longer to see what holiday price reductions Amazon institutes. Competition in the digital reader space is increasing, driving prices down. I'd like to see how much further they fall before I pull the trigger.

2009-10-09 Update: No sooner do I publish this post when word gets around Twitter that Barnes & Noble is planning a color e-book reader, to be released next year. A reason to put off buying a monochrome reader, or does this have further potential to drive prices of existing readers down? Guess we'll wait and see.