The Rise of ePaper: Could Kindle Represent the End of Printing?

Rob Enderle

The other day we were meeting with a company that wanted to take HP on in printing, and several of the analysts in the room were wondering: Why?


If you look at HP's printing business, growth is one of the lowest in the company, even though profitability is very strong and HP clearly dominates the segment. In short, this has the feel of a business that has peaked and is in the process of being replaced by something else.


Moving From Printing To....


Photo processing, which itself was replaced by printers, is increasingly being replaced by PC screens, phones, media players, digital picture frames (expected to be one of the hottest gifts this year) and plain old TVs.


Typewriters gave way to word processors, which gave way to PCs, which are rapidly giving way to on-line tools used for blogs and social networking. We've largely shifted away from paper to e-mail and IM for communications. Which, in turn, also seem to be starting to shift to social networking sites -- all of which don't really need paper.


Until now, eBooks have been a joke, and a bad one at that. The best to date, from Sony, lacked the content and user experience necessary to make the transition, but the hardware was actually very nice. Kindle, from Amazon, the leading on-line seller of books, looks very close to eliminating the need for magazines, newspapers, and books, which is a huge game-changer if it is successful.


Initially, Kindle too falls short, but it comes closer to anything we have ever seen, which suggests we are within months of having a product that could open up this market. And news today is that the thing is selling out. Let's explore the wonder that is Kindle.


The Wonder of Kindle


It is fascinating to watch companies enter a segment and show their strengths and weaknesses. When Sony entered the eBook segment, its strength was in hardware design, and it created a beautiful reader. Its historic weakness is in partnerships and user experience, and the product failed because of related problems.


Amazon gets that content will be key to the success of its product and has created a unique and compelling solution. This solution includes a built in, pre-paid cellular digital network so you can easily buy stuff without a PC any time you are in range of the related carrier (in the U.S., for now, that is Sprint). Amazon also realizes that folks like to read more than just books, and has arranged for magazine subscriptions, RSS feeds, and newspaper subscriptions to ensure you have every opportunity to consume media on the product.


It has anticipated the need for music, books on tape, and podcasts, and the product includes an MP3 player and an SD expansion slot for the needed extra capacity. In short, it is everything that the Sony wasn't. Unfortunately, what will hurt it is that it isn't everything the Sony is.


Design Is Key: And the Key Is Missing


Amazon isn't a hardware company, and while it does sell hardware and should know better, it has created a device that falls short in terms of design. While the market for personal electronics has moved away from white to black, metals, and colors, the first Kindle is white, making it look dated at launch. In addition, the device has a keyboard, but it can't be concealed, which is inconsistent with what we've learned people want on smartphones -- if it isn't small, it needs to go away when not in use.


Much like it was with the Microsoft generation-one Zune (the 80 GB generation II recently sold out, suggesting you can come back), Amazon has done a great job focusing on function but forgot that form is also incredibly important. One of the critical mistakes is the lack of a built-in reading light. Generally thought to be one of the biggest advantages of the first eBooks, Amazon left the light off (you can use a regular book light), suggesting cost issues with the final design.


So, overall, this is a good generation-one product in a market that will likely be waiting for a vastly more attractive generation two.


Wrapping Up


It almost looks like what Apple does is easy, but as I watch companies like Amazon struggle to get the proper mix of hardware design, user experience and content into a product that is affordable, I realize, once again, what an amazing piece of work the initial iPod was. Granted, it too wasn't initially successful. It had to navigate the Mac-centric mindset and become available on the PC for that, but the out of box was magical. (By the way, if you've never seen the video of what Microsoft would do if had done the initial iPod box, it is both funny and a great lesson.)


Still, and back to printing, Kindle is very close to there, and in one generation it could become an iPod-like product. Others will likely see that and work to ensure Amazon doesn't own this market and make a push in 12 to 18 months.


As it turns out, HP also has an eBook in the works, one that is much closer to the design of the Sony, and should it adopt the services represented by the Kindle, HP could emerge as the new leader in this market as well. If there are companies out there that want to challenge HP, they'd better get their rears in gear.


It'll be interesting to see where this technology goes, one thing for sure, at the end of this cycle there will be a lot more happier living trees and. If you like green, you'll find a reason to use an eBook reader eventually.

Add Comment      Leave a comment on this blog post
Nov 27, 2007 11:55 AM Jim Lyons Jim Lyons  says:
Great perspective, Rob! I'm looking at Kindle with a printer-industry view, and it's interesting to me that the category of e-book reader has been viewed as a threat for a long time, even though past efforts have been rather weak.Jim Reply
Nov 28, 2007 6:50 AM Rajeev Rajeev  says:
I think the product is ready for adoption in the west but the developed world loves all trhings retro. Reply

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