Wednesday, September 30, 2009

iRex attacks Amazon Kindle, open versus closed e-book and newspaper offering

Last week iRex announced its new e-reader for the American market: the iRex DR800SG. Although the product itself is a big improvement compared to its predecessors (faster switching time, longer battery life and ofcourse 3G connectivity) the biggest step forward in my opinion is  the content service offered in combination with the product. Working together with Barns & Noble (700,000+ e-books) and NewspaperDirect (1,100+ newspaper titles), e-books and newspapers can be purchased and delivered wirelessly (Verizon) to the device. More content partners are being to join the platform.

Finally, 2 years after the launch of the first Kindle, Amazon is being challenged by a serious competitor. Ofcourse Sony and others have been in the market with competing e-readers but all of those lacked the convenience of Amazon's content service (selection, purchase and instant delivery of content). Until now it seems.

On the surface Amazon and iRex seem to offer a similar package to the consumer but behind the scenes the business models differ greatly. In the case of the Kindle Amazon controls the business model AND the customer, selling the package of Kindle & content. One drawback of Amazon's one-stop-shop model for the customer is the fact that content purchased for the Kindle cannot be viewed on other devices (except the Iphone).

In case of the iRex DR800SG the customer buys an 'open' reading platform to which multiple content parties will be connected. The product will be sold via one channel (Best Buy) while the content is sold by the content partners. With epub format supported on the DR800SG (next to the ereader format used by B&N) the user can read e-books from other sources then B&N as well.

To me the iRex model makes perfect sense as it offers consumers improved flexibility in choosing content from multiple sources. It is a good step towards a fully open content - hardware model which will be a key facilitator to drive e-reading to the mass consumer market. Only an open model allows consumers to buy content from various favorite sources and share it across multiple reading platforms. Being an advocate of an open model I do not see a bright future for the closed Amazon Kindle model, even though it is by far the most popular e-reading platform in the USA.... There is clearly still a lot of work to be done both by hardware and content parties to reach this truly open environment.

How do you see the chances of the Amazon Kindle model versus more open competitor models? Please share your thoughts on this.

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