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Kindle Gets New Lower Price in Germany as the eBook Market Heats Up

kindle germany 49 eurosIt looks like Amazon may have decided to get into a fight over ebook market share in Germany.

At the beginning of this month Amazon lowered the price of the basic Kindle in Germany. They dropped it to a very competitive 49 euros, making that model now 30 euros cheaper than anywhere else in Europe.

This is in fact the second time in the past year that Amazon has lowered the price of the Kindle in Germany. They first lowered the price 3 months ago to 69 euros. At the time I wasn’t certain whether that was a sale or  a permanent price, but the Kindle kept that price for 3 months before the price was lowered again.

The Kindle is still selling for 79 euros on Amazon’s other European retail websites, and that is probably a sign of Amazon breaking with their past pattern of setting a regional price. Clearly they are focusing on developing just the German market at the moment.

That would fit with the latest industry gossip. There isn’t any current data to back up the impression, but the data from past years does tend to support the idea that the German ebook market is growing.

For example, the German ebook market was worth about 2.4% of the overall book market in Germany in 2012 (according to GfK), up from 1.6% in 2011. At the same time, the average price of ebooks in Germany dropped from 10.71 euros in 2010 to 7.72 euros in 2012. A growing number of publishers were offering their ebooks at a lower price than the print edition (69% in 2011 vs 87% in 2012), and that gives readers a financial incentive to switch to digital.

But in spite of the drop in price and increase in sales the available selection is still limited. In 2012 only 54%  of all new titles and 29% of publisher’s backlist available as ebooks. Only 53% of German publishers surveyed in 2012 said that they even offered ebooks.

Sure, that is up from 35% in 2010, but half is still a disappointing number.

I wish I had more current industry data than the results from last year; it would give me a better idea of what Amazon is seeing in their sales reports. But I can live with not knowing because as it stands Amazon has lowered the price of the Kindle twice in the past 3 months.

That suggests that Amazon sees Germany as a market worth fighting over. And thanks to Germany’s book pricing laws, the only tool Amazon has to fight with is the price of the hardware.

The new price makes the Kindle 10 euros cheaper than the Kobo Mini, or about the same price as the budget models on the German ebook market. Trekstor, for example, sells the Pyrus Mini (4.3″ epaper screen) and the eBook Reader 3.0 (7″ LCD screen) for 49 euros.

I’m not convinced that Amazon has been losing sales to those cheaper ereaders (aside from possibly the Kobo Mini) because they’re not very good. But I do think that Amazon is laying the groundwork for future growth. They’re hoping that owning a Kindle will lock in owners, and to some degree they are right.

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fjtorres September 14, 2013 um 12:26 pm

I think Germany 2013 = US 2010 and Amazon is looking to capitalize on the coming explosion.
Plus, Amazon rarely lets anybody undercut them: if entry-level pricing is €49, then that is where Kindle will be. That is why the KPW is priced Lower in Japan than in the US, no?

Nate Hoffelder September 15, 2013 um 6:50 pm

Except Amazon has been undercut in Germany for at least a year. Longer, in fact. So I don’t think hardware is the explanation for this price cut.

fjtorres September 15, 2013 um 8:57 pm

The market is changing. There are signs that ebooks are breaking out of enthusiast/hobbyist territory into the mainstream. Getting undercut in a low volume stagnant market wasn’t important–getting undercut as the market explodes would be. Before it was about establishing the store, now it’s about building up the installed base.
Now it’s serious.

Name September 14, 2013 um 2:28 pm

Well, there is a lot of competition here. I recently bought a Pyrus mini for €29. Many online shops sell the Kobo mini for €39 and the Kobo Touch for €49. The latter was even on sale last week for just €44. I’d say the Kobo Touch is much better than the basic Kindle. So, I personally don’t see a reason to buy a Kindle even for €49, except for the possible attractiveness of Amazon’s ebook shop.

Nate Hoffelder September 15, 2013 um 6:43 pm

I’m not sure that hardware competition is the reason why Amazon lowered the price, because Germany has had cheap ereaders for well over a year. The Pyrus Mini, for example, launched around this time last Fall. and there were other similarly priced devices on the market as well.

Also, doesn’t Trekstor ship to other countries in Europe? Why hasn’t that affected other markets as well?

flyingtoastr September 14, 2013 um 2:38 pm

Remember, when Amazon clearance prices their devices it a brilliant move to build market share. When anyone else does it’s a sign of desperation and imminent bankruptcy.

Nate Hoffelder September 14, 2013 um 2:43 pm

No, just Barnes & Noble, and only because B&N has demonstrated a marked ability to mismanage the Nook platform. Amazon, on the other hand, has often proven to be crazy like a fox.

fjtorres September 14, 2013 um 2:45 pm

Amazon isn’t the one with the shrinking business–closing 20 stores a year–or delaying foreign expansion they are contractually obligated to deliver, or dithering over whether to stay in the hardware business.
When Amazon cuts prices on its eink readers in Japan to $80 it is to grease the entry of its product into a tough market for imports not to clear two year old leftovers out of the warehouses.

Victor Redman September 16, 2013 um 5:57 am

Hey Nate,

I think Amazon is probably looking to fortify their brand against the Tolino Shine, which for all itents and purposes looks and works just like the Kindle and has Germany’s largest bookstore chain, Hugendubel, backing it. The device is enjoying a major marketing push here and is on constant display in stores everywhere, so Amazon is probably trying to secure their market share here. The Tolino Shine is currently priced at €99, so slashing the price of the Kindle ought to give Amazon a considerable advantage.

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