Sony (SNE) and Amazon (AMZN) could have a new and large market for their e-book readers. The head of China Mobile (CHL), the largest cellular company in the world, sees part of his firm’s future growth in the e-reader market. E-readers can be set up so that they use the 3G wireless internet to download books.
But, Japanese and American e-reader firms should not become too excited. China may use local technology to supply the demand for portable digital books. China Mobile appears ready to use Taiwan’s Foxconn Technology Group to provide it with hardware.
The China Mobile plans are a good example of an idea made popular in America moving to the mainland with very few if any benefits to the US companies that championed the technology and market in the first place. China mobile has well over 400 million subscribers. E-reader sales to these customers could certainly top several million easily surpassing sales figures in America. Amazon (AMZN) will see no revenue from the rise of the e-book market in China. Foxconn products may even make their way into the US, challenging Amazon’s e-reader sales.
China Mobile’s decision to enter the e-reader market is hardly piracy, but it is certainly aggressive borrowing of a good idea.
Douglas A. McIntyre
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