Amazon and Apple's open embrace

(Catching up on blogging after getting behind)

On Wednesday, Amazon released a Kindle format reader for the iPhone and iPod Touch. The move was widely praised by key tech pundits in the Washington Post, New York Times and Wall Street Journal as showing Amazon sees itself as a content distributor rather than a hardware platform company.

Several commentators have pointed out a few less obvious nuances. On the one hand, this gives Amazon multiple form factors that can display its 240,000 downloadable book titles. On the other hand, it could cannibalize sales of its $360 device.

Another is the implicit endorsement by providing access to its App Store. It isn’t interested in helping Amazon provide its users with music and video, but its cooperation implicitly endorsed Amazon as the book content provider — suggesting that books are not strategic. In fact, Gartner analyst Van Baker (quoted by ComputerWorld) cited the skepticism of Steve Jobs in 2008 about the Kindle and the e-book business:

“It doesn’t matter how good or bad the product is, the fact is that people don’t read anymore,” he said. “Forty percent of the people in the U.S. read one book or less last year. The whole conception is flawed at the top because people don’t read anymore.”

Several weeks ago, I’d wanted to respond to Tim O’Reilly’s claim that Amazon must embrace open e-book standards. But as Rob Pegoraro notes,

But the arrival of this one program doesn't make the Kindle any sort of open system: You're still limited to reading your not-quite property on the devices that Amazon permits, not the ones you might want.

As I noted earlier, Amazon embraced “open” MP3 standards when it was a challenger to iTunes, but on the Kindle is using a proprietary approach.

However, I want to quarrel with one premise of O’Reilly and Pegoraro. There is no “open” and “closed”: openness is always a matter of degree.

One key metric of openness — in terms of industry structure, consumer choice, competition and switching costs — is when a standard is multivendor. If buyers can choose from multiple implementations, certainly that’s more open than buying products from a single vendor. (This also reduced but not eliminates the angry orphan problem).

By this standard, Apple was told be be more open (like Microsoft) — don’t just provide its platform with its own hardware but license its operating system to competing hardware makers. Now Amazon is doing just that, allowing for multiple sellers of reader hardware; I would presume that the next stop will be either Nokia or BlackBerry smartphones.

Somewhat more open is how Apple now sells DRM-free music on iTunes Store — in response to Amazon’s DRM-free service. Amazon uses MP3 (with patent royalties), Apple uses AAC (without content royalties): both are easily implemented and available on most computers, music players and phones.

However, the Kindle native format is still DRM encoded (“infested”). Jeff Bezos could claim (as Steve Jobs once did) that the content owners made him do it. But DRM has been around in the book industry for a decade, and absent a Kindle challenger, I don’t see it going away any time soon. (As long as DRM is used, will that restrict availability on the Linux-based Android? I can’t say.)

As many have noted, DRM prevents me from selling or giving away used books. In the 19th century, this would have been a big deal. Perhaps if Steve Jobs is right, books won’t matter in the 21st century. Certainly if the Kindle ends up selling snippets and chapters, people will be less motivated to resell a $.25 snippet than a $30 hardback.