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Amazon recently announced that, in the 4 weeks following the launch of their newly enhanced Kindle 3, more Kindle readers were sold than during the same time period following any earlier Kindle reader launch. The new, improved Kindle is not just in high demand – it is the fastest selling Kindle reader ever. Amazon didn’t reveal precisely how many Kindles were sold, but they did confirm that, since the release of the upgraded Kindle, customers have purchased more Kindles on Amazon.com and the new Kindle store at Amazon.co.uk combined than any other product.

Amazon unveiled their latest generation Kindle 3 at the end of July. The new Kindle 3 houses the same size of 6″ display in a smaller (21%) and lighter (15%) casing. Page turns are 20% quicker and the memory size has been increased fro 2GB to 4GB – that’s enough for 3,500 books. With the Wi-Fi turned off, the battery will now last for a month – even with the Wi-Fi on, a 10 day life is achievable – and the e-ink technology screen has had its contrast improved.

Amazon also introduced an entry level Wi-Fi only model, for customers who don’t anticipate the need for 3G. This sells for $ 139, with the 3G plus Wi-Fi model selling for $ 189. Those prices represent huge reductions in comparison with the earlier $ 359 Kindle price tag. It’s a clear indication that the e-book reader market is maturing.

During the first half of 2010, Amazon sold 3 times as many Kindle books as they did during the same period of 2009. There are now in excess of 670,000 titles available on the Kindle store – not including the 1.8 million free classic books on offer.

The Kindle continues to be Amazon’s top selling item. It is also the most gifted and most wished for item on Amazon’s website.com and Amazon.co.uk. With the strong sales returns for the Kindle and the latest technical upgrades, it would be easy to overlook the significance of the opening of the UK Kindle store at Amazon.co.uk. There are 400,000 Kindle books available at Amazon’s new UK store – which could be a significant factor in boosting international sales still further. If it proves to be successful – and why wouldn’t it be – it seems probable that further “local” Kindle stores in France, Germany, Japan etc. – and any other country with its own independent Amazon website – might be opened.

Whilst the Apple iPad continues to offer competition, this doesn’t seem to concern Amazon very much. For the moment at least, the price differential between the Kindle and the iPad is large enough to make the Kindle the natural choice for most customers who are primarily interested in reading books. As the e-book market matures, much more emphasis will be given to the sale of e-books as opposed to e-book readers. The fact that Kindle books are outselling iBooks by a ratio of sixty to one speaks volumes.

At the moment, Amazon is enjoying tremendous success with its new, third generation Kindle reader. An upgrade – which includes a new display with 50% better contrast, lighter and smaller casing, quicker page turns and double the memory capacity – accompanied by a reduction in price and the introduction of an entry level Wi-Fi only model, has seen demand for the Kindle reader soar.

At the moment, the third generation Kindles are sold out and potential customers face a wait of three to four weeks before any new ones start shipping. Kindle books are also outselling traditional hardback editions on a regular basis. It can only be a matter of time before e-books begin to sell more than paperbacks.

Amazon has also launched a dedicated UK Kindle store so that UK customers don’t require to have their readers shipped across the Atlantic and can pay for their Kindle purchases in sterling rather than dollars. It seems probable that further “local” Kindle stores will be opened for other Amazon international websites such as Germany, France etc. in the relatively near future.

Currently, everything in the garden is rosy for Amazon. Reports of the Kindle’s demise at the hands of Apple’s iPad seem to be premature and largely inaccurate. The Amazon policy of releasing free “apps” which allow Kindle books to be read on a wide variety of different devices seems to be paying dividends. So, considering what a massive success they have enjoyed with their first manufactured product, it’s hardly surprising that Amazon is rumored to be considering developing prototypes for personal tech gadgets other than the Kindle in their Lab 126 research facility.

Although Amazon has been tight-lipped on the subject, it’s thought that they may be thinking about music/movie players and possibly some kind of mobile phone. However, industry analysts suggest that, were Amazon to enter the market with another gadget, they would need to be sure that they were adding value rather than just releasing another piece of personal electronic tech onto the market.

Much of the success of the Kindle reader must be attributed to Amazon’s strong association with books and reading in general. The huge number of Kindle books available – over 630,000 and increasing every day – and the fact that these can be read on so many other devices has been a real feather in Amazon’s cap. Any new gadget that Amazon decided to release would certainly need some similar type of support in order to achieve anything approaching the level of the Kindle’s success.

This time last year, the new market for e-book readers was really taking off – gold rush style. Following the huge success which Amazon had achieved with its Kindle reader – first with the Kindle 2.0 in February of 2009 and then with the large display DX model in the summer of the same year – a small army of personal electronics firms seemed to be developing, releasing or updating e-book readers of their own in order to grab a share of the new and rapidly developing market.

Sony and Barnes and Noble were bursting a gut to get their new readers launched before the 2009 festive season and Samsung, Plastic Logic, Asus and a host of others were rushing to get their readers on the market as fast as they could. The Computer Electronics Show (CES), held in Las Vegas in early 2010, had a dedicated e-book reader section for the first time ever. E-book readers were a hot developing market.

Right now however, no more than a few months later, it’s an entirely different scenario. The price of e-book readers has tumbled. The new third generation Kindle now has an entry level Wi-Fi only model on offer for just $ 139, less than half of the $ 359 price at which the Kindle 2.0 launched. Barnes and Noble have also dropped the price of the Nook reader to S 149 – and this will probably be cut again before the festive season.

Several new e-book readers which were going through the development process – including Plastic Logic’s Que – have been cancelled. The market appears to be entering a new phase in its development – whether there will be a place for pure electronic manufacturers in future or not is somewhat debatable. The Amazon business model lends itself very well to selling lower priced readers and making a profit on the follow up sales of Kindle books. A similar strategy would be available to Barnes and Noble of course, but it’s debatable as to whether or not they can benefit from the same types of economies of scale as Amazon.

Clearly it would be somewhat naive to ignore, or even play down, the impact of Apple’s iPad in this. There’s little doubt that e-book reader prices would have come down anyway – but the iPad has certainly hastened things along quite a bit. However, bearing in mind the fact that the new third generation Kindles sold out shortly after they were released, the iPad doesn’t look like the Kindle Killer that it was expected to be.

Even putting the debate about e-ink displays being easier to read on than backlit screens to one side, there is – at this time – enough of a gap between the price of the Kindle and the price of the entry level iPad to ensure that the Kindle will continue to be the more attractive option for anyone who just wants to read books. The monthly connection fees for the iPad will also not be to everyone’s taste.

It does look as if there is sufficient room in the market for both the Amazon Kindle and the iPad to co-exist – for the foreseeable future at any rate. Other manufacturers, including major players like Sony and Barnes and Noble, will probably struggle badly if e-book reader prices keep falling.