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Posted by James McQuivey on October 26, 2010
Today, amid the kind of rumor and speculation that is more typical of a Silicon Valley announcement, Barnes & Noble unveiled its NOOKcolor, a second NOOK to complement the barely one-year-old original. The NOOKcolor brings a 7" color LCD touch tablet device to the reading market, filling a gap between today's grayscale eReaders that use eInk technology and tablet PCs like the iPad.
This move puts B&N ahead of both Amazon and Sony -- the longtime holders of the number 1 and number 2 slots in the eReader business. Not ahead in terms of device sales, because this new NOOK, priced at $249, will be likely to drive a few hundred thousand units before year-end. But ahead in terms of vision. Because one day, all eReaders will be tablets, just as all tablets are already eReaders.
There are three good reasons why tablet readers are the right thing for the industry to move toward:
That said, this shift won't happen immediately. Amazon's Kindle has about two-thirds of the US market for eReader devices as well as eBooks. The new, lower prices on the Kindles are drawing people into the market quickly. And once drawn in, it's unlikely that they'll skip over the cheaper market leader to go right for the $249 NOOKcolor. Instead, the new NOOK is more likely to attract people already familiar with the market who are ready to move to a device that can satisfy deeper content longings. Those content longings will go beyond books, however, to include music and video, two staples of the iPad experience. Suddenly B&N will find itself attracting a market of people who want to do more than read books from B&N. They'll want to use the Android-based device to play games, check email, and surf the web, even if they primarily use it for consuming personal media. But the apps needed to deliver those experiences will only be available after developers learn how to develop for NOOKcolor. In other words, Android apps won't automatically work on NOOKcolor, though it will be relatively easy for developers to port their apps to NOOK, subject to B&N's approval. (It should go without saying that one developer B&N will likely reject is Amazon should it try to develop a Kindle app for the NOOKcolor!)
While the device won't unseat Amazon, it does throw down a gauntlet to Amazon and Sony both. Both of those companies could easily develop a tablet device focused on consumer media -- and both have sufficient motivation to provide media beyond books. But I'm starting to doubt whether Amazon will rise to that challenge. After all, Amazon may see itself as a software platform provider by this point -- it makes the Kindle platform available on as many devices as possible and it sits back and counts the eBooks it sells. Sony, on the other hand, could build a tablet that is part eReader, part PSP, part video player, part VAIO computer -- the options for Sony are endless. So consider B&N's move as the first volley and sit back with me and see what else develops.