Sony Revisits E-Book Assumptions For Next Reader Rollout
*Sony* will begin selling updated versions of its Reader Pocket and Reader Touch devices today, but it is still months away from releasing its new Daily Reader with WiFi access. In practical terms, that means that Sony (NYSE: SNE) will not be directly competing with the Amazon (NSDQ: AMZN) Kindle and Barnes & Noble (NYSE: BKS) Nook, but Steve Haber, president of Sony’s Digital Reading Business Division, isn’t too concerned about that. “We like to say that we’ve been looking at the e-books market through a crystal ball and a rear-view mirror, and that has proven a lot of early assumptions we and others have made wrong,” Haber told paidContent during a demo of the new Readers. Among the surprises that Sony executives say they’ve discovered: WiFi isn’t that big a deal to e-book readers.
Haber cited a recent survey of consumer habits by Marketing Research & Resourcesfor Sony that showed wireless access was far from the number one thing people rated in terms of importance when choosing an e-reader. “In some cases, it wasn’t even in the top five or the top ten,” Haber said. “The majority of the time people use the devices, they’re at home. The thinking was that people would want e-readers for travel. We were assuming that. But we learned from it.”
The new Pocket and Touch readers should show up today in Sony’s revamped online store as well as increasingly crowded and competitive e-reader retail locations Then, in November, the wireless Reader Daily Reader, which was limited to 3G, will hit the store shelves with WiFi and “basic web-browsing” added to the mix.
Haber also cited company research that claimed that consumers didn’t really value wireless as part of their e-reader. Since there is a certain segment that does, Sony will offer the addition of WiFi to its Daily Edition. But this device isn’t made for web-browsing, he said with pride. “People just want to read, that’s why they turn to an e-reader and not their computer,” he said. “And that did surprise us to a certain extent. For example, when it came to providing newspaper subscriptions, we thought having 3G access would mean a lot. And it does. And we assumed that people with USB devices wouldn’t buy subscriptions. We never counted that a substantial portion of those USB customers would stick with their subscriptions, since you can easily cancel monthly. The churn has been extremely low.”
—Touchscreens across the board: The big news right now then is that all Sony Readers will now have touchscreens, along with a stylus for making handwritten notes and illustrations on top of the content “page.” The other major change is that all the devices weigh a bit less than their predecessors—a natural and expected progression, but one worth noting.
The new releases also boast a crisper display with new E Ink Pearl software and a screen designed to reduce glare to a greater degree than before. The prices of the three new devices range from $179 for the Pocket (available in silver or pink shells) to $299 for the Daily Edition (which comes in silver and black). One added bonus for the new Reader Touch Edition, which costs $229 for a black or red model, is that it now has 32GB of additional memory and the ability to play MP3 and AAC audio files.
Finding the formula: Haber believes they’ve arranged the right formula to gain greater market share and beat back criticism that the electronics giant is still playing catch-up. Specifically, Sony’s Haber says the company has more in-depth insights when it comes to what consumers want from e-reading, such as “content portability” across various devices. So as it updates its e-reader line, Sony is also working on mobile e-book apps for Android and Apple (NSDQ: AAPL) products to be released by the end of the year. (Kindle and Nook are already there, as is Borders with Kobo.)
He credits the rise of the Kindle and interest in the iPad with fueling e-books purchases, something that all companies in the space can capitalize on. But it’s Sony’s own experiences with consumers that have inspired what Haber described as an evolution in its approach to the market.
—‘Has to feel like a book’: “Our forecast was that Pocket would clearly outsell Touch – it was a $100 more, for one thing,” Haber said. “We were wrong. Pocket sold very well and met all our expectations, but we totally underestimated Touch. Ultimately, what we discovered was that it was the overall value proposition that drew people to the Touch and that price wasn’t the only factor. The number one important thing for consumers of e-readers was that it has to feel like a book.”
That sentiment doesn’t mean that e-readers should be leather bound. Rather, the content should act like a book in terms of quality of text, being able to mark it up and having the ability to be read in the sun. And for those who want full color on their devices? That’s not necessarily what readers want in a device, Haber claims, but he conceded that it does factor in for purchase decisions. As a result, Sony is promising more color and better visuals in its Sony Reader store.
One other assumption that Haber added as a caveat—it’s still too early to really know what users will ultimately want from e-reader devices, so the strategy is still a work in progress and anything can change, especially when it comes to consumer behavior.
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