Amazon (AMZN) Kindle And Sony (SNE) E-Readers Wildly Overpriced

The e-reader market which has been the subject of so much media attention may be going through a growth spurt now, but that is not likely to last. Sony (SNE) and Amazon (AMZN) may find that their sales of products like the Kindle will fall apart as the holidays approach.

Research from Forrester says that the average price that consumers are willing to pay for e-readers is only $91. The average price at which most consumers would walk away from buying as e-reader altogether is $151. The price of a standard Kindle 6″ wireless reader is $299.

Sony is just getting into the e-reader business and several book marketers including Barnes and Noble (BKS) are counting e-book sales to help reverse the flagging sales of books in their stores.

Wall St. research firm Collins Stewart says Amazon will bring in Kindle sales of $310 million this year rising to $2 billion in 2012. That figure seems improbably if the Forrester data is even close to being correct.

The information is an indication that the market research done by Sony may have failed the company again. The e-reader business was supposed to be part of the renaissance of the consumer electronics part of Sony. Its e-reader initiative may be another in a series of plans that did not work well.

Prices for e-readers will not drop sharply by holiday shopping season, and the e-reader phenomenon may have lasted only a year.

Douglas A. McIntyre