Take That, B&N: Amazon Slashes Kindle Price To $189

Amazon (NSDQ: AMZN) is following Barnes & Noble’s lead and slashing the price of its e-reader. The company just said that effective immediately it will sell its Kindle 2 for $189, down from its previous price of $259. The move comes only hours after Barnes & Noble (NYSE: BKS) cut the price of its 3G Nook e-reader by 23 percent, to $199 from $259, and introduced a lower-end WiFi version at $149.

This is the third time in just under a year that Amazon has cut the price of the Kindle 2, which initially cost $349 when it launched in February 2009. Amazon cut the price to $299 last July and then to $259 last fall.

Barnes & Noble launched the Nook in November, and despite some early stumbles with distribution, there have been reports that it’s now catching up — and even exceeding — the Kindle in monthly sales; for instance, DigiTimes said recently that March sales of the Nook were greater than those of the Kindle.

At $189 and $199, respectively, however, the prices of the Kindle 2 and Nook still aren’t where some analysts think e-reader prices have to fall for the devices to go mass market. A recent Forrester survey indicated that e-reader prices would have to fall to below $150 — and perhaps even as low as between $50 and $99 — to get more widespread adoption.