E-Readers: The Multipurpose Competition Heats Up

E-book devices now let users wirelessly download all kinds of content, including music. New entrants to the market boost the chances for broader e-commerce use

By Cliff Edwards

Electronic book readers aren't just for books anymore. Just how widely e-book readers may soon be used became clearer on Sept. 23. That's when news that a little-known electronics manufacturer plans to enter the market in November was quickly overtaken by leaked photos that indicated Microsoft (MSFT) has also set its sights on the e-book market.

First came the announcement that iRex Technologies will soon release the first device that lets users wirelessly download books from anywhere in the world. The $399 iRex reader will feature an 8.1-inch screen and run on the Verizon Wireless network in the U.S. Using technology by chipmaker Qualcomm (QCOM), the device will also be capable of tapping into content from other wireless networks. "IRex's strategy, based on giving consumers choice, and the partnerships we have in place make it easier for them to purchase a device, access content, and enjoy it wherever they are," says Kevin Hamilton, CEO of the company's U.S. division.

Hamilton and his cohorts didn't have long to bask in the publicity, though. The same day, online tech-gadget site Gizmodo reported that Microsoft is working on a dual-screen booklet-shaped device code-named Courier that uses both a stylus and finger gestures to operate. Microsoft's device appears to boast touchscreen capabilities similar to those in Sony (SNE) electronic book readers, but in color.

More Tablet-Style Readers Expected

Just three years after Sony launched the first widely available reader and accompanying e-book store, announcements of these new tablet-style gadgets are coming fast and furious. Apple (AAPL), too, is expected to release an e-book-friendly tablet computer in the coming months. Like Sony and Amazon.com (AMZN), maker of the Kindle, these new entrants are eager to tap what's expected to be explosive growth in demand for machines that let consumers read content anywhere. The U.S. market alone will grow to 13 million devices in 2013 from 3 million this year, according to Forrester (FORR).

But there's more to the effort than simply giving consumers a new way to read. Many of the latest devices are being sold with a free mobile broadband connection that lets people quickly connect to online stores and download all kinds of content, including music, photos, and video. With consumers increasingly embracing on-the-go electronic transactions, manufacturers are racing to add color screens as soon as next year that will be better-suited to selling clothing and magazines and delivering digital coupons.

Retailers Seek Opportunities

Retailers see other big benefits. The devices boast screens that are larger and more readable than those on Apple's iPhone and other smartphones, which has become one of the fastest-growing consumer electronics categories. While Best Buy (BBY) and other retailers make money selling phones, they're increasingly being locked out of the market for selling content delivered to those phones.

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