Amazon profiting from Apple’s success

I always find it interesting how people talk about one thing killing off another when new gadgets are announced and released to market. How the iPad was a Kindle-killer, for example. As we all know by now, nothing could have been further from the truth, of course, and it doesn’t surprise me a bit.

I’ve never understood why our culture is set in these incredibly competitive patterns. In everything. People turn anything into a contest, as if their lives depended on it. Somehow they all forgot somewhere along the road that competition belongs into sports, and that’s about it. Pretty much anything else in this world is about coexistence.

The Kindle and the iPad are a fine example of this. There never was a need — or desire — for the iPad to make the Kindle obsolete. Why, would it? They are two entirely different things, designed for different purposes, with strengths and weaknesses that make them more interesting to some, or less interesting to others. It is dynamic, and it is fluid, evolving and not something you can declare as a one-stop Kindle-killer.

Both devices have had a good run so far — excellent, as a matter of fact — and as we can see now, they co-exist very nicely. Even more so, they nurture each other. In the fourth quarter of 2010, for example, Apple sold over 7 million iPads, and 67% of these people are reportedly reading on the device.

Awesome news for Apple’s iBookstore, right? Well, yes, and no, because as statistical data show, not even 30% of these iPad users buy their books through the iBookstore. In fact, over 40% of iPad readers bought their books from Amazon, using the Kindle application to read.

See, while the stock market jocks try to convince everyone that it is an all-or-nothing world out there, abusing claims to Darwin’s “survival of the fittest” theory like there’s no tomorrow, the fact of the matter is, that unlike the analysts, the consumers actually have a bit of common sense and adapt. We have long stopped taking things as they are. We are shaping everything around us, as all the technologies around us empower users.

Many users, like myself, own both, a Kindle and an iPad — and why not? I use the iPad for different things than my Kindle. They coexist nicely, each in their own niche. When it comes to reading and I may not have access to my Kindle because some other family member hogged it, I might use the Kindle application on the iPad to read on that device instead. No skin off my back. If I’m traveling and don’t have the Kindle around? The iPad fits the bill just fine.

One of the smartest moves that Amazon made — and one that analysts entirely overlooked at the time — was the creation of software-based Kindle readers for every platform out there. This makes Kindle content more valuable, and the same is essentially true for the software implementations of Barnes&Noble’s Nook and their software readers.

I can understand why people won’t buy books in the iBookstore. The iBook application may be fancy and all with its animated page turns, but ultimately, it is limiting the reader to the iPad, iPhone or iPod.

Creating software-based Kindle readers was the smartest move for Amazon to ward off any competition from the likes of Apple or any of the other tablet manufacturers crowding into the market. For the longest time, people thought Amazon’s Kindle was all about selling the hardware, but as everyone in the video games industry will gladly tell you, ultimately it is all about the software — that is where the real money is.

Amazon had zero research and development costs to create the iPad or any of the Android phones and tablets, but they are cashing in on them in a really big way, and that is what I call a smart strategy! No risk, but all the glory.


Leave a Reply

Your email address will not be published.