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Steve Ballmer wrong about e-readers.

In a vintage Microsoft moment, Steve Ballmer has said that Microsoft doesn’t need to build an e-reader, because the PC is already the most popular reading device in the world. “We have a device for reading. It’s the most popular device in the world. It’s the PC”, said Ballmer.

I wish I agreed. 

The fact is, I (and many others) have been debating about buying an e-reader device for some time.  The convenience of the form factor is just too appealing.  An instant-on high-contrast device that I can easily hold while lying in bed or sitting on the sofa, and that can hold a significant portion of my library… well, I can only say that such a device would have huge appeal to me.

Don’t get me wrong.  I read a lot of material on my PC.  I don’t read anything of any length or consequence on the PC, however. I read it on paper.

And more and more, I find myself reading books on my iPhone.  It’s instant on, I can easily hold it while lying in bed, and it can hold a significant portion of my library.  If the screen were a little larger – say 8.5 x 11 inches – it would be perfect.

Food for thought Mr. Ballmer.  Sometime in the not too distant future I’m going to buy an e-reader.  It can’t be a Microsoft product if Microsoft doesn’t make one.

{ 6 comments… add one }

  • Alan Quayle October 9, 2009, 5:23 am

    Hi Alec,

    Like so many consumer electronics topics today, format-wars, fragmentation and use-case dependent diversity will likely dominate. The e-reader is a great technology, for some it will be the answer they seek; for others books are preferred because they can be SHARED, taken anywhere, squeezed into the airplane seat pocket or a carry-on bag without worry, left on the beach, and even read on the toilet (stepping on a book doesn't break it). E-readers unfortunately lack the ruggedness of a book.

    The PC/Mac/tablet can be adequate for reading articles / papers / analysis – especially if any bookmarking/cut&paste is required, or SHARING. Though for some traditional printing on paper is required – could be another e-reader use case here, though I find some PDF documents don't appear that good on e-readers.

    The book market in the US is about $25B. Current Kindle sales are shrouded in mystery but estimates of 1.5M units by the end of the year, and 3M total e-reader units shipped are being made by the likes of Forrester. Focusing on the facts, Sony sold 400k units last year. Where available 35% of book sales are for the Kindle version. Global e-book sales are up 300% last quarter compared with last year to $38M (US book sales were $8B).

    As the price of the Kindle continues to drop from $299, to $259 (US only), $279 international version. Once it gets to that critical $149 it will then be in the early majority segment. So e-readers are here to stay and will likely become a significant part of book industry, so its unlikely the Publishers will stop this trend, though there remains a lack of inventory at the moment.

    The question of format wars will arise. Currently my books are not dependent on Amazon. But with Kindle the content is dependent on Amazon, and critically it can not be shared. Google will soon be a significant player – will Kindle play fair with Google? There remains some significant uncertainty in the e-reader market.

    Maybe the opportunity will be not in the e-reader hardware, but in the format wars, and the winner there will be whoever can solve the sharing issue, allow multiple stores, and have PDFs displayed reliably. So I agree Balmer is wrong that the PC is good enough, but I'm not convinced MS need an e-reader, rather a solution to the above problems that can allow flexibility in whatever e-reader I buy. Though I think Sony may get there first.

    • Alec October 9, 2009, 5:32 am

      Thanks for the insightful commentary Alan. For what it's worth, I don't think much of the Kindle business model either. It's iPod/iTunes prior to Apple's decision to remove DRM, and as the music world has learned consumers don't want DRM. The most compelling device I've seen was from Plastic Logic — 8.5×11 form factor, with a flexible screen that (they claim) dramatically improves durability.

  • athir nuaimi October 9, 2009, 9:34 am

    Ballmer is definitely wrong in saying that a PC is as good an eReader as a Kindle. But I will add that as much as I want an eReader, I really don’t want a task specific device like the Kindle. While it’s the best eReader out there today, I really want a general purpose computer that is a great eReader. Like what the rumoured Apple tablet might be. If there is such a thing, I’m sure it be a great eReader AND be based on OS X thus having an app store. Which means that I can also read email, use twitter or whatever else I desire. That’s so much more appealing than just a Kindle.

    And that’s where I think Microsoft has an oppurtunity. Rather than sitting on the side-lines and letting Apple steal another market, they should take a leadership position and drive a Windows based eReader. One that is a great eReader first and foremost. What we don’t need is a simple repackaging of Windows. We need a custom version where every design decision is based on what is needed to create a great eReader. That might mean they have to create a reference design and set some standards as well. What we would end up with is a device that has the same industrial design standards as an Apple device but with better economics (thanks to vendors like Dell and HP).

    The question is whether Ballmer understands the importance of industrial design in this day an age. The days of users putting up with devices or software that is not easy and pleasurable are long gone. Today, to succeed in the market, you need to think about the entire solution: hardware, software, back-end services, etc.

    Given MS’s recent history, my money is on Apple or Android to own this market.

  • Stuart Henshall October 9, 2009, 10:59 pm

    Alec, think the real deal is how you and I now use our iPhones to read the paper, books etc. We just woke up one day and realized that it consumes a lot of time and we're happy enough doing it. I won't buy an e-reader until it functions better than my iPhone. I'm not sure I want one as big as the rumored apple tablet. I also have some other criteria for it. Still…. the big dirty secret is reading people… are using their iPhones like crazy. Unfortunately, I think Balmer like too many executives is unwilling to spend days with a product that was made by a competitor. I don't read papers on my PC. I never have. I read them daily on my iphone. Books same story.

  • Paul Jardine October 12, 2009, 3:55 am

    I’ve always believed that Steve Ballmer is incapable of thought, to any meaningful degree, therefore it’s a vain hope that he will guide MS in a reasonable direction.
    The thing I find interesting is that I see less need for people to actually ‘own’ a book (or a song or a film). Having a subscription based service (e.g. Spotify) may be enough, where the ‘pot’ is distributed to the artists according to their relative popularity or the aggregator licenses the material for a defined period.

  • Suzanne Collier October 13, 2009, 12:31 pm

    Alec, great article! I agree with other comments that Steve Ballmer is wrong about e-Readers and that the PC is not the end all, be all reading device. In fact, I only read short articles on my PC, and could not imagine using it to read an entire book. I myself still like the feel of a book in my hand as I read, and while the Kindle is probably the most appealing option at this point in terms of an e-Reader device, I’m not clear that they have the best business model yet, and it will be interesting to see how Google books business model develops, especially with the opposition. I read just this morning that Germany is now fighting back against Google’s scanning and cataloging of books.

    You mentioned in your article that you are finding yourself reading more and more books on your iPhone. I’ve tried the eReader and Kindle for iPhone but I find the screen to be much to small, and because I read so quickly, I end up having to spend a lot of time paging through. I do like this concept though, and should Apple come out with the much-rumoured tablet, I think I might find myself more apt to read books on that platform.

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