The Kindle and “barriers to entry”

Will Sullivan threw me off yesterday when he wrote on Poynter’s E-Media Tidbits about how the Kindle “removes the print barriers for entry.” He used “barrier to entry” in a different way than I understood it: That which prevents competitors from entering a market.

Using the term differently doesn’t necessarily harm Sullivan’s argument (although it does make it more ambiguous, because now I don’t know quite what he means), but it reminded me of last week’s On The Media, which I had just been listening to. The publisher of the Dallas Morning News was on, discussing why he hadn’t yet signed up his paper for Kindle distribution.

Answer: Amazon gave them a raw deal, or at least one he didn’t find too pleasing, and I could see why. He said the contract would have allowed Amazon to license Morning News content wherever and whenever they chose, without leaving Dallas the option to intervene. As I’ve said, I’m no expert at business models, but it strikes me as fair for Jim Moroney to be concerned.

This isn’t to say that the Morning News faces a barrier to entry to Kindle distribution. It’s still an option to them. But the more popular Kindle becomes, the more people may have to rely on Kindle distribution to find paying customers — and the more clout Amazon has in weilding its terms. Even then, though, I’m not sure it would be considered a formal “barrier to entry,” but it sure would make things more difficult.

::: Update – May 12 :::

Sullivan notes Henry Blodget’s comments about the increase in Kindle sales, especially after the latest version was released. It’s important here to remember cognitive dissonance, I think. That theory says, in part, that we do a very good job at convincing ourselves that we made the right decision, and will continue to act in ways that justify our decisions. The relevance here is that Kindle owners may not actually enjoy reading on Kindles but instead have to tell themselves they really do. (I’ve heard similar anecdotes of enjoyment to what Sullivan has heard — but then again, is it believable?)

Also: Sullivan says the increase of Kindle says as a percentage of book sales demonstrates that “Kindle users are voracious readers.” Not so. There’s nothing to suggest the percentage of book sales demonstrates a “voracious” bunch, so how could there be anything in the percentage of Kindle readers that suggests it? For all we know, it could be 35 percent of 100 books (Danielle Steele books at that).

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Little help here? I want to learn about the Kindle

I’m trying to research for a post about Amazon’s Kindle and the history of distributing news.

The impetus came from Steve Rubel, who argued on Micro Persuasion that newspapers should put their material on Kindle posthaste. I started wondering about the implications of journalists entrusting a third party — in this case, Amazon — to deliver their content. What happens if, for example, journalists find success with Kindle distribution, but then Amazon decides Kindle isn’t profitable enough to keep producing? This argument would extent, of course, to any medium controlled by a person or organization other than the journalist (Facebook? Google?).

Then I started asking myself, “how much has changed from when newspapers ruled? Were they at the behest of advertisers, or even the newsprint companies, in the same way as I worry they are with Amazon? Were there key similarities?”

I don’t have any answers to these questions, but I think they could lead us in a few different, though certainly not mutually exclusive, directions.

One possible conclusion is that the Kindle’s dangers mean journalists should make every effort to diversify into every possible distribution outlet. They need to monetize as many of these as possible as well — not too many loss leaders allowed here.

Another possibility is that journalists should use as much open source software and open file formats as possible. This would mean that they retain some fungibility over where they could bring their work (assuming Kindle is not open enough that my news story formatted for Kindle won’t be much good going to some other device).

Or this may have to be a purely philosophical exercise. If Rubel is correct, then journalists don’t have the luxury right now to be choosey in distributing their work. They have to take what they can get.

Does anyone have reading suggestions to start?

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