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Summary:

Amazon, perhaps driven by the forthcoming launch of Apple’s tablet style computer is turning its Kindle device into a platform. The Seattle-based online retailer today announced that it will allow software developers to build, upload and distribute active content (aka apps) from its Kindle Store.

Amazon, displaying a sense of urgency that is perhaps driven by the pending launch of Apple’s tablet-style computer, is turning its Kindle device into a platform. The Seattle-based company has announced that it will allow software developers to “build and upload active content” and distribute it through the Kindle Store “later this year.” Amazon will be giving out a Kindle Development Kit that will give “developers access to programming interfaces, tools and documentation to build active content for Kindle.” The company will launch a limited beta effort next month. From the press release:

“We’ve heard from lots of developers over the past two years who are excited to build on top of Kindle,” said Ian Freed, Vice President, Amazon Kindle. “The Kindle Development Kit opens many possibilities–we look forward to being surprised by what developers invent.”

I would also like to see what developers come up with. An Electronics Arts executive in Amazon’s press release says that company is looking to develop games for the Kindle platform. I wonder how much can you do with the limited hardware that is a Kindle. Screen refresh rates are low, the inbuilt processor is puny and of course, no color. Unless Amazon is planning to launch a beefier and color version of the device, game developers are unlikely to be able to create great experiences on the Kindle.

The New York Times, which it seems was exclusively briefed before the news announcement, has some more details on Amazon’s plans:

Ian Freed, Amazon’s vice president for the Kindle, said there would be three different categories of active content: free applications, one-time paid applications, and applications that require a monthly subscription. Kindles that have already been sold will be able to run these programs once Amazon has remotely upgraded their software.

Developers will get to suggest their own prices for their programs, but they will have to shoulder the cost of wireless delivery at a rate of 15 cents a megabyte. After those costs are covered, developers keep 70 percent of the revenue from the sale of the app, while Amazon keeps 30 percent. (Remember that unlike smartphones, the Kindle does not require a monthly wireless fee.)

What I suspect will happen is that a lot of content-focused apps are going to be created for the Kindle platform. Amazon has been enjoying amazing success with the Kindle, though it’s still not clear how many of the devices the company has sold. Forrester Research estimates that nearly 3 million e-readers were sold in 2009, but it doesn’t say how many of them were Kindles. According to some estimates, the Amazon Kindle will bring in $310 million in revenue for 2009 and $2 billion in 2012. In order to attract developers, the company needs a lot of Kindles in the market. Perhaps that’s why Amazon is trying to tempt consumers by allowing them to try its Kindle and return it if they don’t like it.

My initial skepticism aside, Amazon is making the right move by opening up the Kindle. I’m sure even the company, like many others, does have to be worried about Apple’s tablet — which could quickly become a competitor for single-purpose e-readers. Like the Kindle, the new tablet is also aiming to become an all-purpose content consumption device. As I wrote back in March 2009:

“First of all, people are looking for a cheap, connected Internet device that is ‘not a laptop.’ I was recently watching an interview with Amazon’s Jeff Bezos on ‘Charlie Rose’ in which he talked about the Kindle being flexible enough to encourage new kinds of media consumption, including multimedia books and newspapers with immersive content and interactivity. I think he is spot on — and just from that perspective, Apple has to be thinking really hard about this looming opportunity.”

Yesterday, Amazon had announced that it would be giving away 70 percent of its digital content sales to the owners of the content, clearly a sign that it wants to attract and retain the content industry. The New York Times adds:

Apple representatives have been in New York this week talking to the largest trade publishers, according to industry executives. They said Apple had proposed an arrangement under which publishers would get to set the price of their books, with Apple taking a 30 percent commission and the publishers keeping the rest.

“There’s a battle going on for what is the value of a digital book,” said a publishing executive who did not want to be quoted by name because of the delicacy of discussions with Apple. “In that battle, Apple has put an offer together that helps publishers and, by extension, authors.”

There you have it — the reason for Amazon’s sense of urgency.

Related Research from GigaOM Pro (subscription required.):

* The Evolution of the e-Book Market

* Irrational Exuberance Over e-Books.

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  1. I’d love a local weather application.

  2. Imagine talking to people reading the same page of a romantic novel on Kindle at the same time as you are. Imagine seeing that person’s movements on a google map. Man, imagine finding love using kindle… These are some initial apps that will get built.

    Alternative (scary ) scenario:

    Imagine reading Gigaom on Kindle, and finding that the scary dude sitting across from you is also reading the same article and he is seeing that you are moving on the google map at the same speed as him ( both of you are on Caltrain). Imagine he starts talking to you about how wrong gigaOM’s analysis and why you should really be reading Techcrunch, and that dude happens to be Michael Arrington…no, these apps won’t get built, even with the lure of Tech Crunch 50 awards..

    1. Sam

      You can actually read GigaOM on Kindle :-) It is available on that platform as “blog” subscription. ;-)

  3. Brave attempt but Kindle’s demise is inevitable. Amazon, just doesn’t have the right DNA to sustain a hardware/platform business. After the 27th the game will change again and Amazon will not have the stomach ($$$) for a protracted hardware battle with Apple.

    1. Unless it has e-ink and a store with access to all the books I want to read, I don’t see how any Apple tablet will replace the kindle. Try reading a novel on a laptop screen and then try it on the Kindle. Night and day…

      1. Well no one has seen this thing yet. I’m also really curious to see what kind of screen they use in order to make it readable.

  4. Lab126, the Amazon.com subsidiary who develops the hardware and software on the Kindle, is based in Cupertino, CA – not Seattle…

    @Luis – a lot of the folks at Lab126 are ex-Apple, ex-Palm folks from what I recall – so they know exactly what they are doing from a platform perspective… Amazon.com is a very patient company. They out-Google’d Google with their S3 services. Google App Engine should have been launched before any of the Amazon.com services.

    1. John

      Thanks for the information on Labs126. I agree on Amazon being a very patient company. I wouldn’t take them lightly by any means.

    2. By no means Amazon is a slouch! What I meant to say, is that there is a huge difference between someone who does the whole widget for a living than someone who outsources part of the widget in order to sustain the main business.

      In the future, the Amazon app on the iPhone or any other handset will be the way to go. Sustaining the hardware business is not a strength or the structure of Amazon. No matter how many people from Apple or Palm they hire. I’m sure these individuals know exactly what they’re doing they just don’t have a structure around them to support what I said “an onslaught” moving forward.

      Look at Sony, they had to build an Amazon in order to sustain their hardware sales for the reader. Where do you think that is going to end up? It wouldn’t surprise me if the Sony reader becomes a customer of Amazon in the future and that’s where Amazon’s mojo is!

      Patience for Amazon will = loss of millions of dollars+ plus time wasted in an unwinnable hardware arms race.

      1. Luis,

        You make good points. From the way I see it, Amazon isn’t going to lose this war, even if it loses a battle or two. Just as it released a Kindle app for the iPhone, it can continue to do well even on Apple’s platform(s).

        I think this is what separates them from rest of the e-Reader makers including the likes of Barnes & Noble.

  5. whats the need of kindle and their platform when we will get full color ARM tablets in 200$ ?

  6. Not sure why these products are constantly compared.

    I love the Kindle for the zero strain on my eyes while reading (like normal book). I could never get used to reading from a laptop/smart-phone screen.

    There is a lot to improve on the ebook user experience, just hope Amazon is giving developers enough tools.

  7. I see this as a must do for Amazon to combat B&N and the Nook. Not just because of the Nook as a device, but it runs on Android. This year we’re going to see a bunch of Android readers, and let’s face it, Android already is a platform. Amazon must do this or die over the long term. I think Android will win over this special Kindle platform, though. Too restrictive.

  8. I like Amazon as a company and am a frequent customer. But I am bothered by the lack of transparency on the number of units shipped. The company needs to share this info to convince us that it is truly being adopted. Otherwise, skepticism is warranted.

  9. Is EA really looking forward to developing games for the Kindle?

    This announcement seems like a bad April Fools joke.

    What’s next? Emerson announcing a development kit for their clock radios?

    Actually if they can do a better pdf reader it will end up being a win for Kindle users.

  10. Amazon planning a KDK (Kindle Development Kit) and a eco-system around Kindle means better Kindles (probably a tablet) is in horizon.

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