Sony Turns the Page with Its New Reader

Two e-book readers due in late August aim to close Sony's sales gap with Amazon, whose Kindle continues to sizzle

By Cliff Edwards

In mid-July, Forrester Research called Amazon.com's Kindle e-book reader devices "the flame that lit the wildfire" for digital reading. Rival Sony (SNE) is adding its own fuel to the fire with two new e-book readers (including a cheap, stylish, pocket-size device) that could boost consumer adoption of Sony's Reader.

With the new $199 Sony Reader Pocket Edition and $299 Reader Touch Edition, expected to go on sale Aug. 25, the consumer electronics giant is trying to prevent Amazon from becoming the runaway leader in a market that's expected to grow explosively in the next 10 years. Sony's Pocket Edition will be $100 cheaper than Amazon's Kindle 2, while the more expensive version will offer touch technology that lets readers swipe their finger across the screen to turn pages.

More Content Options

Sony aims to expand the e-book reader market by offering customers more choice than Amazon (AMZN), which requires users to purchase books and other digital media from its online bookstore. Sony will match Amazon's $9.99 price for new releases and best sellers, while letting users load free content from its link to Google's catalog of 1 million public domain books and at public libraries.

"Our goal is to expand the market and provide greater access to what consumers want to read, when they want to read it, whether they buy, borrow, or get it for free," says Steve Haber, president of Sony's Digital Reader Business Div.

For Sony's executives, making Reader a success has become a point of pride. Sony was first to market five years ago with a digital book reader, a device sold only in Japan that used electronic ink technology that mimics the look of copy on a page. It quickly followed with a sleeker U.S. version called the Sony Reader PRS-500, only to see Amazon's Kindle come along a year later and grab the lion's share of sales. Unlike Sony's devices, the Kindle lets U.S. consumers wirelessly download books, newspapers, and magazines.

Plans for Worldwide Wireless

Sony has said it's working on its own wireless device but hasn't said when it will launch. Company insiders say the delay has been caused in part by technology considerations connected with Sony's view that consumers should be able to download content wirelessly anywhere around the world. Amazon uses Sprint's (S) proprietary wireless technology to download new books and other material instead of the more common worldwide GSM cellular standard, which currently limits Kindle sales to U.S. customers.

Even without a wireless device, Sony's new products are likely to boost sales during the holiday shopping season. Sony is dramatically expanding its retail presence and will sell the devices, cases, and other accessories online, at Best Buy (BBY), Wal-Mart Stores (WMT), Target (TGT), Costco (COST), and nearly a dozen other retailers.

The new Sony devices address the top three barriers consumers say have kept them out of the market for electronic readers. According to a Forrester survey of 4,000 consumers, respondents said they wanted cheaper devices, cheaper books, and hands-on experience with the devices.

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