Allen Weiner

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Allen Weiner
Research VP
7 years at Gartner
23 years IT industry

Allen Weiner shares insights on how to monetize digital marketing through commerce. His focus on “Commerce Everywhere” provides perspective on how social, mobile, search and emerging channels can be tapped to improve customer experiences and drive business results … Read Full Bio

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Sony, Plastic Logic Turn up The Heat on Amazon

by Allen Weiner  |  August 13, 2009  |  2 Comments

Somewhere in Seattle, likely over cups of very strong coffee, the powers that be at Amazon are no doubt planning a well-caffeinated response to two recent announcements in the eBook market as well as some well-speculated product and service releases that could come in Q4, just in time for the holiday shopping season. Amazon’s original intent to create a stranglehold on the Ebook market by offering a device and Ebookstore, may seem like a good idea at the time, but is now looking increasingly as a potential strategic miscue. The part of the plan that may force them back to the drawing board is their use of a proprietary format for both book files as well as DRM.

Given that a vast majority of the book world (publishers, enablers) supports the .epub standard and has rallied behind Adobe’s ACS4 as the DRM for .epub, Sony, the “other” early entrant in the Ebook reader space, has announced a move away from its proprietary standard for both its device family as well as online bookstores. Folks who have older Sony’s PRS-500 e-reader will also provided an update path for the new format. Sony’s move has some interesting implications: for starters, it puts more heat on Amazon who sits practically alone in offering a device and Ebook store that supports only its .azw secure format. For Sony, it shows it is leveraging its bets by separating its product lines into device and Ebookstore columns. While the two work harmoniously in that the newly announced devices will no doubt be geared to work seamlessly with the Sony Ebookstore, the Ebookstore will allow anyone with a device that supports .epub to go there to buy their digital books. In essence, Sony will compete with two separate (with some overlap) sets of companies: for devices, it will battle Amazon, Astak, Irex, Cooler and (when it launches) Plastic Logic. In the Ebook storefront space, it will compete with Amazon, Barnesandnoble.com, Borders, individual publishers and literally thousands (2,498 according to LibreDigital) of digital content providers. The picture gets really murky once you factor in partnerships and white label provision, but let’s leave that for another day.

But wait, there’s more. Plastic Logic, whose device aimed at “mobile business professionals,” and is targeted for a Q1 2010 release, has inked two impressive and interesting partnerships. As the device will include 3G/WiFi connectivity for remote Ebook buying as well as offering the capability to update newspaper and magazine content, Plastic Logic recently announced a partnership with AT&T. That positions Plastic Logic quite well against Amazon, especially after announcing a relationship with Olive Software, a digital warehouse/digital enabler primarily servicing in the newspaper and magazine space. Whether or not the deal is exclusive or will expand to include either Ingram or LibreDigital who have more experience working with book publishers remains to be seen. Nonetheless, we see the need for three key components to building a successful consumer-facing Ebook content consumption experience (say that fast three times): a device that supports multiple formats, especially e.pub; a relationship with a wireless service provider to facilitate 3G/WiFi capabilities and a enabler to power the flow of content directly to the device or to Ebook retailers who then sell content to multiple devices.

If all of this sounds complicated, it is, but will likely get more complicated before the entire Ebook marketplace simplifies for publishers and consumers. Whatever happens, hold on to your Kindles—they may wind up being valuable artifacts/icons of a major misstep from a previously powerful media titan.

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