If Amazon is hoping its latest price cut for the Kindle will make the e-reader a bigger holiday season hit, it's going to have to do better. The reduction -- from $299 to $259 -- still leaves it $60 higher than Sony's starting price for its rival e-reader.
More broadly, it's simply not a deep enough cut to get the attention of consumers outside the early-adopter crowd. To get closer to putting a Kindle in every stocking, Amazon has dropped the price to at least $199. That's what Phil Schiller, Apple's vice president of marketing, called the "magic price point" at the company's event last month introducing a new line of iPods and other products.
He said Apple "learned something really important a few years back in the iPod business," referring to the iPod mini-that sales doubled when its price dropped to $199. With the iPod touch now priced at that level, as well as the iPhone 3G S, Apple has helped make it a standard for popular handheld gadgets.
And with its dramatic price cut of the existing iPhone to $99 earlier this year, it forced other handset makers such as Palm and BlackBerry to push down entry-level prices for their smartphones. So Amazon should to take a page from Apple and put aside the incremental price cuts in favor of a bolder move to put the Kindle within reach of the masses.
Paired with the Kindle app, the iPhone and iPod touch already serve as e-readers of sorts, for much less.
Amazon Wednesday also launched a version of the Kindle that will be able to download books wirelessly both outside and within the U.S. The new "U.S. and International" model will be available Oct. 19 and sell for $279, offering wireless service in more than 100 countries.