Amazon’s Jeff Bezos talks about Kindle 2
Reuters spoke to Amazon.com’s Jeff Bezos at the launch of the Kindle 2.
He talked about device’s price, Amazon’s big picture for Kindle, international plans and cannabilization.
Reuters: Has Kindle been a big hit since its debut late in 2007?
Jeff Bezos: We had way more demand than we ever expected or even hoped for.
which meant that we were sold out during 2 holiday seasons. which is not a good idea – not the plan. we made more than we though we would need and we still sold out. so its a high quality problem in the sense that demand has been very very good.
Reuters: Popular yes, but aren’t digital book sales still a fraction of physical book sales?
Bezos: In 14 months, for the 230,000 titles that we have Kindle additions, Kindle unit sales already represent more than 10 percent of Amazon’s total sales in those 230,000 titles. We spent 14 years building our physical books business. And in just 14 months, this is already 10 percent. So we are all very surprised that it is being adopted so quickly.
Reuters: How many Kindle 1’s were sold?
Bezos: We are going to stick to our policy of not sharing that.
Reuters: What is the long term goal? Is Kindle going be strictly for text or some kind of wonder gadget that competes with iPods and other multimedia devices?
Bezos: We are really focused on making the best purpose-built reading device…for books, magazines and newspapers, blogs. It does have a web browser, so you can surf the web wirelessly. (It has) A basic browser — it doesn’t do flash, for example. So that’s not the focus of the device. That’s not the emphasis of the device. The real focus is reading. Its a device for reading.
Reuters: It does play MP3’s…
Bezos: But that’s not the focus of the device.
Reuters: Who helps you make it?
Bezos: We don’t share the underlying business economics of the device. We believe it can be a meaningful business for us, over time.
Reuters: An Amazon employee (at the event) said it was made in China.
Bezos: Yes. We design it. But we don’t have our own factory.
Reuetrs: Any International plans?
Bezos: If you look at Amazon’s business overall, half of it is outside of the United States. We have a lot of global customers. this a U.S. device. We are not ready announce anything today about a global device, but with that big international customer base, we obviously are thinking about it.
Reuters: Any fear of cannibalization?
Bezos: Our view on that is — We sell kindle and kindle books. and we sell physical books. We are going to try as hard as we can to have the best physical book store in the world. And we are going to continue to pour energy into that, And we are going to work as hard as we can to make sure the Kindle is the best it can be. We are going to let customers choose how much of which one they do. You can imagine a different scenario where we would have the kind of business where we say ‘we want to have x-percent to be electronic and x-percent to be physical.’ We don’t do any of that.
Reuters: Amazon sells everything from giant screen TVs to tiny memory cards. Are you interested in making other electronics hardware products?
Bezos: We are totally focused on reading . We have no plans or thought about making any other kids of devices. We are really focused on this.
Reuters: What about a partnership with Apple or another partner?
Bezos: I don’t want to talk about a particular company but we are excited about making kindle interoperable with mobile devices. We announced Whisper Sync today. you can reader on your kindle and read on your phone and we keep track of your place. People are going to read on a multitude of devices. Kindle is the largest E-book store in the world and we want to make sure that if people want to read those books on a multitude of device that we are open and excited about that.
Reuters: People say $359 is expensive, and demand would be greater at, say, $99.
Bezos: We can’t make this device less expensive. It has this sophisticated EV-DO wireless radio, has the most sophisticated electronic paper display, a very fast processor. (Also) in Q4, in the midst of the worst macro involvement in a long time, we way underestimated demand for Kindle 1 at $359. So even in the midge of the worst macro economic environment probably since the great depression, people were buying kindles. Its just not possible to make this device less expensive.
If we could make it cheaper we would. We can’t make it cheaper.
Reuters: Washington – Any quick thoughts on the economic debate on stimulus?
Bezos: From Amazon’s point of view, we will stay heads down, focused, doing the same thing we have been doing for 14 years, which is lowering the prices, increasing selection…speeding up delivery. We are not going to change the way we do business because of the macro environment.