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Sony conforms to compete: Low-priced reader and $9.99 e-books ahead

According to The Wall Street Journal, Sony will introduce new versions of its Reader and lower the price of e-books in its store to match the prices at Amazon.com and BarnesandNoble.com. The devices, the PRS-300 and PRS-600, as well as their respective prices, $199 and $299, were “leaked” last week, including the pricing (ZD Net’s Larry Dignan has a good summary about the new readers). Sony’s falling into line with pricing of e-book titles is the news here.

Now, what’s got me wondering here is how all the would-be major vendors of e-book readers are competing on price and only price, for both the hardware and content, what’s the opportunity to differentiate? At this point, only connectivity, which Amazon has nailed with the WhisperNet technology it currently offers. Plastic Logic will have a Sprint-enabled WAN service, too, but Sony’s still in the wilderness with its dock-to-sync e-readers—however, The Bookseller reports that Sony is planning a Wi-Fi-enabled Reader for European release this fall.

If connectivity is the only differentiator, the opportunity to extend competitive advantage lies in one of two directions:

  • The iTunes Model—Make a proprietary system so darned convenient that the customer hopefully forgets about the DRM and other downsides, or;
  • The Rich Format Model—Take an open format for e-books and begin adding to it, putting annotation and other “social” features into the titles to begin to add value.

No device succeeds without adding value to the experience its competitors provide. Amazon remains the standard setter in the e-reader business. No one wants to go into the uncharted waters of open and “social” formats where the real wealth lies.

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