Amazon (AMZN) vs Apple (AAPL)

By: ispeculatornew
Date posted: 03.24.2010 (5:00 am) | Write a Comment  (4 Comments)

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I’ve written about this in the past but I believe it even more as time goes by. Amazon will suffer a lot more from the arrival of the Ipad than most would imagine. Some had pointed out that electronic books represented such a small portion of Amazon’s sales that the impact would be minimal. And they could have been right. But my opinion was that Amazon would lose so much focus & energy on this battle with Apple, one that I believe it cannot win, that it would impact the rest of the business as well.

Last week, I mentioned that Amazon was threatening smaller publishers that decided to offer their books on Apple’s Itune store. Seriously? Is that the best they can come up with? Because knowing how Apple has dominated Apps and music, I can’t imagine a publisher would go down that route. Instead, they would probably take themselves off of Amazon. And right now, the selection of books is the only thing keeping clients around.

The product is simply superior

Hearing about Apple hiring staff to start building a colour screen for its Kindle is cute in a way but kind of pathetic in another no? I mean we knew years ago that this was going to happen so why did Amazon just figure out now that having a black and white screen might be a problem when competing against competitors? Did it not anticipate that the competition would have multi-use products to compete with the Kindle? The problem is that at this point, it is probably too late for Amazon to catch up. The Ipad has not even been shipped yet and it’s already years ahead of the Kindle or even worse, it’s years of the future version of the Kindle.

So what is Amazon to do?

I would say it’s simple. Wave the White Flag, give up. Not in the sense that Amazon should stop selling and producing the Kindle, but rather that it should focus on its core strengths, its distribution and shipping network. Continue producing the Kindle but set it off as a division that is no less but also no more important than the others. And when I hear news about Amazon, I would expect the Kindle to be a small portion of it. Amazon is not equipped to compete with Apple for such a device, especially when you consider companies like Sony & Microsoft failed.

Am I being too radical? I just don’t think it’s bad luck that Amazon’s stock has suffered since the release of the Kindle.

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4 Comments

  1. Comment by Zavi — March 24, 2010 @ 8:24 am

    Who is going to win the e-book market? I think this is a cheap shot from Amazon, threatening small publishers. I really dislike Amazon’s vision.

    What I think is that Amazon is really scared of Apple. because Apple is being innovative with a product that is good for the developer and the consumer!!!

  2. Comment by The Rat — March 24, 2010 @ 9:25 am

    I also just did a thread on the iPad and I think Amazon is in for some turbulence for the e-book market. I keep thinking of Palm when they had their black and white interfaces. It was only a matter of time before better gadgets were released. Without innovation, as Zavi mentions, you’re doomed in the long-run!

  3. Comment by Chris — March 25, 2010 @ 6:18 pm

    Apple is being innovative?? Please, Apple is making something evolutionary, not revolutionary…an oversized iPod touch. Amazon is already creating an app for the iPad, so they could give two nickels about it as long as they continue to sell Kindle books through their apps. The Kindle is a device that does something really well. The iPad appears to be a device that does multiple things somewhat adequately. Time will tell, but if I was Amazon, I would keep doing what I am doing and maybe work on lowering the cost of producing the Kindle.

  4. […] been a fan of Amazon to a certain extent in recent months but have been very critical of Amazon’s continued focus on the Kindle will end up costing Amazon. The electronic reader has been losing market share very quickly to […]

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