You might argue that Sony was visionary. In the fall of 2006, it introduced the first eBook with an E Ink screen—long before Amazon's Kindle rolled out with the same technology. The Sony Reader also connected users to an online store, solving a problem that had long bedeviled the e-book market—how do you get books onto your new device?
On the other hand, you could say Sony was incompetent. The Reader was buggy—many users faulted its uncomfortable controls and unintuitive software. And its eBook store was threadbare; it had just 10,000 books when it launched. According to AdAge, Sony spent more on marketing the Reader than Amazon has spent on pushing the Kindle, but the company never managed to convince people that they should take a chance on this new way to read books. An eBook reader is a tough sell. It's expensive (the first Reader sold for $350), which means that it will really appeal only to voracious readers, a customer base that is also resistant to change. Amazon understood this perfectly; its masterstroke was to give the Kindle a free, always-on wireless Internet connection, turning an electronic screen into a book-delivery system. Now Amazon could offer something that no printed book could compete with: books on demand, anywhere, for cheap. Though neither company has released detailed sales numbers, it's obvious that the Kindle is cleaning the Reader's clock. The Kindle has become synonymous with eBook readers, overshadowing every competitor—the Kleenex of its industry.
Now Sony is trying again. This week it unveiled the Reader Daily Edition, a new digital reader that includes a wireless connection and touchscreen—something the Kindle lacks. The new Reader will go on sale in December for $399. Sony hasn't let anyone play with the device, so it's hard to say how well it will stack up. But its launch suggests that Sony isn't going to concede the market to Amazon. That's good news: As I've written before, though the Kindle is great, authors, publishers, and readers will suffer if a single company comes to dominate the future of books. It's in everyone's best interest for lots of eBook makers to flourish—that'll keep down prices and keep one company from dictating the terms of eBook sales.
If you're in the market for an eBook device today, you've got some choices. Besides the Kindle and the Reader, there's the Cool-er, the iRex iLiad, and an upcoming reader from Barnes & Noble (which already offers mobile apps that let you read eBooks). The trouble is, we've heard this story before. After the iPod came to dominate the music industry, a host of tech firms tried to take it down. Apple faced what looked to be stiff competition from Dell, Creative, Microsoft, and even Sony. And none of them came close to toppling the iPod. The market for eBook readers is similar to that of music players—both devices replace analog content with digital files, and both industries must negotiate deals with content providers who are leery of the digital age. Anyone looking to beat the Kindle, then, should look to the iPod: Study everything that Apple's rivals did, and do the opposite.
Lesson No. 1: Beat the Kindle on features, not just price. One of the reasons the iPod managed to stay on top for so long was that Apple was constantly innovating. Its rivals would match its features—stylish design, unbeatable interface, ever-better capacity—but by the time they got there, Apple had invented some newer, better, smaller, sleeker iPod, and its old version was now passé. Eventually there seemed to be only one reason to buy a rival device—it was cheaper. But it turned out price wasn't a deciding factor for most people. Customers chose the pricier iPod because it offered a lot more, not to mention because it had become a fashion statement.
The good news for Kindle rivals is that there are lots of ways to improve upon Amazon's device. Sony is on to something with the touchscreen—the Kindle's biggest flaw is its cumbersome directional-pad pointer, which is slow to respond to commands. On the Sony Reader, you can get a dictionary definition just by tapping a word, and go from page to page by swiping the screen—in other words, it follows an interface that people already use on smartphones and other touch devices. When I reviewed the Kindle DX—Amazon's big-screen reader—I lamented that it formatted nonbook content (newspapers and magazine stories) in ways that weren't very useful. Non-Kindle devices could let publishers lay out their content more creatively—for instance, a newspaper could create graphical pages that show off several stories side-by-side. Also, even though the current Kindle is much prettier than the old Kindle, it's not an iPod-like fetish object. Sony or someone else has plenty of room to design a prettier bauble.