Amazon Ordering Fewer E-ink Screens – Death of the eReader or the Rise of Liquavista?
I think we now know why the CEO of E-ink stepped down last week. According to Digitimes, Amazon has cut their orders for E-ink screens:
Amazon Kindle e-book reader panel shipments reached about 750,000 units in January 2013 followed by 420,000 units in February. The shipments are expected to drop even further to 20,000 units in March and April, which is expected to affect E Ink Holding’s (EIH) revenues for the two months, according to industry sources.
E-ink is quoted as saying that this was not unexpected; the first quarter is usually the quiet period in the calendar, with sales picking up later in the year. E-ink’s revenues were down 33% and 44% in January and February, respectively, and the following 2 months could even be worse.
I wonder how accurate the production rumor really is? When you consider the scale of Amazon’s worldwide operations, a supply of only 20 thousand components is effectively the same as not producing any Kindles at all. That 20,000 is barely enough to repair returned units, so unless Amazon is in the habit of sinking money into excess stock this rumor suggests that they’re going to stop making Kindles for at least part of 2013.
How long will Amazon stop? That’s another question, and that depends on whether they have actually stopped producing Kindles. I have a sneaking suspicion that Amazon is planning to start producing Kindles with Liquavista screens.
That would make sense, would it not? Amazon is reportedly buying Liquavista, and that implies Amazon wants to use Liquavista’s low-power screen in the Kindle. Starting production in, say, May would guarantee a sufficient quantity of color Kindles to ship in October – more than enough, in fact, to supply a worldwide launch. Amazon had supply issues last Fall when the Kindle Paperwhite launched, so I can see them wanting to avoid repeating the problem with a new color Kindle.
On the other hand, it is almost as likely that I have Liquavista on the brain and am reading too much into this small piece of production news. Let’s see what is leaked over the next few months.
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