Nice essay by Charlie Stross. The gist of it is:
publishers don’t manufacture ebook readers; the consumer electronics industry does. And the consumer electronics industry will not cut off its own nose to spite its face by producing an ebook reader for $20, if it can produce one with extra bells and whistles that sells for $350. We’ve had the tech for a $20 (or $50, anyway) ebook reader for a decade; it would resemble a grey-scale palm pilot, albeit without even the PDA functionality. But the parts are dirt cheap these days! If a manufacturer thought they could sell the beast, they’d be churning them out by the bucketload — and it’s perfectly possible to read ebooks on a 160×160 green screen. I used to do it all the time in the mid to late 1990s. The reason nobody makes such a beast is because it’s simply not profitable to do so. Explaining why this is so ought to lead into a long essay on the cost structure of consumer electronics, but basically, unless the Chinese government decides to subsidize its indigenous manufacturers in order to deliberately destroy the western publishing industry, it ain’t gonna happen.
Secondly, and more devastatingly for the sky-is-falling promoters of the “pirate ebooks will doom the publishing industry” theory, until ebook readers cost no more than a hardback, 90% of readers will ignore them. And that’s regular readers, not the folks who own four books (and one of them is a Bible). Expecting people to cough up $200 for a reader so that they can then pay $25 for new novels to read on it — as opposed to buying the novels for $25 (less discount) in hardcover and having the cultural artefact — is, well, it’s just bogus.
We might see such a device (at $200) take off in the book club market. Imagine you join the e-book club. Your first sign-up gets you an ebook reader loaded with five titles for $20. Then you have to buy a book a month for the next year before you can leave, and you’re paying $20 a pop. After a year you’ve got 17 novels and an ebook reader, and you’re out $240 for a $200 reader. Most abook-clubbable people will stay in (they’re set up for the club and they’ve already got a small bookshelf on their reader) and over the next year the club can make the profits to pay for that first year’s loss-leader.
But 80% of readers don’t do book clubs. I’ve seen my book club sales, and they’re piss-poor (except in France, which is different).
Basically, the universal ebook reader is a non-starter — at least for this generation — for the same reason that it’s near-as-dammit impossible to sell hardcover midlist novels for more than US $24; consumers don’t like being milked.
Thanks to Cory Doctorow for the link.