Google Editions Doesn't Stand a Chance vs. Amazon Kindle
CNET has an interesting interview with Ian Freed, Amazon vice president for the wildly popular Kindle electronic book reading device, that makes me wonder whether Google should even bother launching its Google Editions online bookstore. Freed claims Amazon commands 70 to 80 percent of the e-reader market. He doesn't just mention it offhand, it's more boastful and assertive than that. Here's the question-and-answer exchange: CNET: Well, Apple's saying it's got 20 percent market share and I've heard Barnes & Noble saying it's got 20 percent as well, so that would leave you guys with... Freed: Honestly, something doesn't add up because we're pretty sure we're 70 to 80 percent of the market. So, something, somewhere isn't quite working right. I encourage you to do some more research. Obviously, from the beginning of Amazon we've been very metrics-focused and we don't typically throw out numbers we don't firmly believe in. Take that 70 to 80 percent number and add up all the others and something somewhere isn't going to add up. Let's assume Freed is right and Amazon really has, say, 75 percent of the e-reader market. Let's assume Barnes & Noble's Nook and Sony gadgets and other devices round out the market. Why on earth is Google launching Google Editions this summer? Google Editions will make some 400,000 books available online to readers through any Web browser and Web-enabled device, including laptops, tablet computers and smartphones. Readers will use their Google accounts to purchase the books directly from Google, whose Google Checkout system will serve as the payment platform. Google will pay publishers 63 percent of revenues and keep 37 percent for itself where it sold e-books directly to consumers. The search engine will also let independent bookstores in the ABA and others sell their e-books on their own sites using Editions. In this wholesale model, publishers would get 45 percent, with most of the remaining 55 percent going to the retailer. Google would take a small revenue cut. Google Editions is unique in that it doesn't specify certain devices or get wrapped up in DRM controls the way Amazon Kindle and Apple's iBookstore for the iPhone and iPad do. But it's still going against a well-established market, where Amazon is the Google of the e-reader domain. So I say why bother? I don't like Google's moves here anymore than I like its flirtations with the online music market versus Apple's iTunes. I argued as much here in June. I don't mean to suggest Google shouldn't enter any market it can't win the way it has dominated with search. But it shouldn't dabble where so many others are well entrenched. Where's the value in that sort of "me, too" proposition? In such instances, I think Google underestimates its user base. It assumes that its Web searchers, which comprises 65 percent of the United States and more in other countries, all use or will use Google's other Web services, too. That's given it a sort of hubris in believing it can compete in any market it enters just to make sure its ads catch more eyeballs. Google: Apple owns music, Amazon owns books. Don't embarrass yourself. Google Book Search is a different animal because it aims to make orphan works the other book providers aren't trucking in available online for purchase. This could catch on big in university libraries. But Editions is just another mini-mart for books. The open device and platform approach is a nice gesture, but it's not enough. Amazon Kindle is rolling. |

Comments (18)
I've read lots of eBooks, but haven't purchased my first eBook from Amazon yet. I much prefer Baen's Books because they are cheaper and they are DRM free. If Google Editions provides books without DRM I will definitely prefer those over Amazon (or Apple or Barnes and Noble). Leasing books rather than owning them makes me very uncomfortable.
Posted by Peter Heitman | August 3, 2010 12:51 PM
By next year we will here that Ian Freed along with his huge arrogance has left Amazon (i.e. shown the revolving door with a swift kick in the pants) after the latest quarter shows that Google Editions tremendous success has succeeded way beyond Amazon's expectations and left Amazon Kindle in the dust to Jeff Bezos horror.
Posted by jojo | August 3, 2010 1:53 PM
What ever happened to the belief that customers benefit when there is strong competition? As a customer, I don't like DRM or being locked into a proprietary vendor technology.
I have never purchased any eBook, and may not, as I like holding paper in my hand. I have purchased a lot of digital music, currently Amazon is my default provider at least since Apple bought Lala. If Google comes out with an alternative way to buy music, especially if they make it available in a choice of MP3 or FLAC, then I'll use their service.
If there are at least 3 or more viable companies competing for my business in digital content, then that would be great. Apple and Amazon both seem to want to control that market and those consumers. I welcome the prospect of being able to turn to Google as an alternative.
Posted by tommy | August 3, 2010 2:42 PM
i appreciate the sentiment but I'd rather Google focus on markets that aren't "owned."
Why play second, third, fourth fiddle for a fraction of the money AMZN, Apple or anyone else are making? Google won't make a lot of money from reselling the books online.
Then again, the overhead of Editions may be low enough to make it worth it if Google sells ads against it
Posted by Clint Boulton
| August 3, 2010 3:21 PM
The value is in competition and choice for the customer.
You may be happy saddled with iTunes, but many of us aren't. It wasn't until other players--Amazon included--came along that Apple even considered removing DRM from iTunes. Now everyone is better off.
I like the idea of DRM-free books, access to independent publishers, and access to out-of-print books.
In your view of the world, Ma Bell would still be a monopoly and we'd all be paying $20+ (2010 adjusted) for five minutes of long distance.
Posted by Tedd | August 3, 2010 6:21 PM
I'm not applying this issue outside books and music.
Posted by Clint Boulton
| August 3, 2010 6:35 PM
Call me a Luddite, but I won't be buying an electronic book from anyone any time soon. When (and if) I ever do, it won't have DRM attached, won't be accessible only on a single proprietary reader, and won't be some illusory idea of a marketing guy as to 'what the market wants'. So far, that means all the offerings are out on at least one count (Google and its machinations around copyright) and usually two (B and N, Apple, and Amazon).
Posted by TonyH | August 3, 2010 6:38 PM
i want to OWN my ebooks like how i own my hardbounds.
Posted by shir | August 3, 2010 8:28 PM
BORING!
Just like Apple, Amazon sells a Wi-Fi Kindle and a 3G Kindle... Instead of following in Apple's footsteps, amazon SHOULD HAVE just eliminated that choice all together and made them all 3G. Who's going to buy the Wi-Fi? BORING!
"Paying $10 to get on a Wi-Fi network to shop for and download a $9 book seems really stupid to me." -Rob Enderle, ConceivablyTech
So does paying $50 extra for 3G. YOU IDIOTS! IT SHOULD BE FREE! THEY'RE BUYING YOUR SHIT!
Seriously, this is a weak response to the iPad.
Posted by Steve Jobs | August 4, 2010 2:16 AM
And yes...Google shouldnt have entered the search market. When Yahoo, msn and altavista were so dominant. :D
Posted by Niru | August 4, 2010 3:55 AM
This article above is dumb. It's exactly because Google Editions is supposed to be released soon, that I have not purchased a Kindle. If Google's Editions are at least comparable if not better to Amazon, I would prefer Google's open platform than an locked-in platform such as Amazon or Apple.
That said, if Editions does not come out soon, I may cave into Kindle.
Posted by Jacob G | August 4, 2010 8:19 AM
I disagree. Competition and differentiation is what reduces costs and promotes innovation.
I read everything I can on my sony reader or a browser, but I always try to "steal" the content first on file sharing sites. Intellectual property, especially when it comes to digital media, is one of the great frauds of our civilization. I refuse to buy from Amazon because of their DRM. I would buy a lot more books, if a company starts selling ebooks without it. Google Editions sounds like a step in the freer direction, so I will give Google my money before Amazon.
Posted by zach | August 4, 2010 10:27 AM
And have far fewer titles to choose from. For too many of you folks, your sense of open, non-DRM is outweighing quality of service. Editions won't have a hearty fraction of the titles Amazon will have at launch.
Posted by Clint Boulton
| August 4, 2010 10:32 AM
Freed has the arrogance that Atari had when they dominated the early game console space. With his logic, maybe Google should have just shelved Android phones because Apple and Blackberry owned the space. EReaders are just starting, and will evolve in the next years. One reason to wait to buy an ereader is to buy one that will allow the user to order Google Editions through their favorite local bookstore online website. This will allow those who want an ereader to do so and still support their favorite local bookstores.
Posted by Bill Jansen | August 4, 2010 6:53 PM
Here's what I live by: If it's Google...it's better.
Why should Google enter a market already dominated by another company? Because we've seen time and time again that their innovation has far outshined those others. Social networking and Google Docs have been the only real problem children. Gmail is easier to use and gives me more space. Google Calendar allows me to toggle and share calendars. Google Chrome is streamlined and much faster.
So really--are you seriously--asking the question "why should Google do it?" BECAUSE THEY'RE BETTER AT ALMOST EVERYTHING THEY TRY, THAT'S WHY!
Posted by Tav-El | August 4, 2010 9:47 PM
A few comments:
First, to the article - I'm always a little leery about statistics that are quoted without the basis for the statistic.
70-80% market share could mean almost anything.
Are 70-80% of all ebooks purchased from Amazon?
Are 70-80% of all ereader hardware platforms Kindles systems? And, if we are talking hardware plateforms, do we mean dedicated ebook readers, since many distrubtors (including Amazon) now have multi-platform applications (smartphones, PC/MAC, iPad).
Or, are they saying that 70-80% of ebook users have some form of Kindle interface? This would be the most misleading statistic of all - in this case, one person may be counted multiple times. I myself have the following installed on my Motorola Droid:
Ereader.com's eReader application (B&N precursor)
Nook (B&N's official Android applications)
Kindle
AM I a marketing statistic for both B&N and Amazon, and does B&N count me twice?
Second, regarding DRM:
Are we certain that Google Editions will be DRM free?I'm working from recollection, and don't have the opportunity to research this just this second, but I seem to recall that it was mentioned (at least in passing) that Google was in fact planing to plae DRM on to their ebooks (I think this was required to get publishers to sign up with them).
What I have seen Google advertise is that the reader software itself will be universal - that any system that has a web browser will be able to run Google Editions. People also seem to take this to mean that you would need to be able to access the internet to read the books, but last time I checked, all of my web browsers can also access off-line content (even something as simple as an HTML document located on my desktop).
However, the fundamental value of Google enteing this market still remins the same - the ability to divorce your content from any specific hardware device is HUGE. Last year, the Nook was ranked by Time Magazine as the top gadget of the year. So, you wnet out and bought a Nook, and proceeded to by hundreds (if not thousands) of ebooks (my mother has done exactly this - she is definitely in the mid 100's of books at this point, after only 8 months - she frightens me sometimes).
Two years from now, ereader technology improves. You have color E-Ink, you may have a direct touch-screen interface rather than the secondary one. Your Nook has finally started showing its age, and you want to get a new system.
Unfortunately, all of your content is tied to Barnes and Noble, so you are pretty much locked to B&N's latest and greatest.
This is a story that has played out time-and-time again over at least the last 10 years (and in some cases much longer - see Mac vs. PC). It used to be the same with the iPod... how many Kindle users felt trapped into their second or third Kindle...
This has diluted to some extent with the introduction of applications from these guys, and the rise of what are (effetively) mini-computers, such as the variety of smartphones, the iPad, and the array of other tablet systems on the way.
But the ability to read books on one piece of hardare, toss away the hardware, and carry all of those books over to another totally unrealated piece of hardware (DRM or no) is HUGE.
Posted by Bru | August 5, 2010 2:02 PM
I am always leery of Jeff Bezos and his minions at Amazon. They throw out a lot of percentages and comparisons without giving the numbers any foundation.
They can claim 70-80% of the market all they want, but remember, they don't break out the book or ebook numbers from everything else they sell online. That makes the book numbers suspicious. Until they tell us exactly how much they are selling when it comes to books, and books alone, I will have absolutely no confidence in their "numbers."
Amazon also makes all sorts of outrages claims about the Kindle and ebooks, yet there are no hard numbers to back those up either. Estimates are that they have sold about 3 million Kindles in the past three years, but Amazon themselves won't confirm that. Apple has sold about 3.5 million iPads in 4 months- that's a hard number.
Amazon claims they sell 180 ebooks for every 100 hardcover books sold. Again those numbers are dubious. While there is no doubt that ebook sales have increased (we are seeing this everywhere in the ebook market), what Amazon didn't disclose are the hard numbers behind this "comparison." Have their ebook sales really increased exponentially, or rather, and most likely, have the sales of hardcover books diminished significantly? If this is the case, then while ebook sales have gone up, hardcover sales have gone down (probably more rapidly than ebook sales have gone up), thus creating the illusion of massive ebook growth if you use ONLY this tenuous comparison.
Face it, Amazon has rarely ever been forthcoming with numbers below the "total sales" figures. Until they do some breakdowns of book figures and show us what they really do- I say Bezos and his Amazons are full of crap.
Posted by Drew Goodman | August 5, 2010 6:49 PM
I've pre-ordered my Kindle WiFi. I'll like to see Google sending the books they have, because if they are DRM free, I will convert them to mobi and read them on my Kindle. There is no problem in Google selling DRM free books.
Posted by John Holloway | August 9, 2010 9:51 AM