The Kindle: "Looks Like a Million to Me"

Amazon and Sony both use the 6-inch electrophoretic display (EPD), also known as an e-ink screen. Both companies buy their EPD’s from Prime View International (PVI) of Taiwan. DIGITIMES, a daily news service covering the Taiwanese IT market, reported on April 18th, in a story entitled PVI EDP shipments to grow sharply in 2008, that PVI expects EPD module shipments to reach 120,000 units PER MONTH in the second half of 2008. It further explains that the unit price of the screens are $60-$70 per unit and that the current volume has been 60-80,000 units PER MONTH.

Also intriguing is the article’s claim that 60% of the EPD’s go to Amazon and 40% go to Sony. This is an important factor as it implies that there is a market beyond Kindle - a very, very strong market. Taking the figures at face value, Sony was selling (or at least manufacturing) an average of 28,000 readers per month (I took 70,000 units as the average sold per month and then 40% of that). Using this monthly rate, the annual sales of the Sony Reader are at nearly 350,000 units. Using the same formula, Amazon is ordering an average of 42,000 units per month, which will add up to over 500,000 units sold this year.

Schnittman then goes on to provide some ebook industry sales estimates based on the figures released by Jeff Bezos at D and BEA, namely that of the 125,000 titles available both in print and on the Kindle, 6% of unit sales were for Kindle titles. He estimates a range of sales of from $60 to $120 million in 2008 ebook sales. (And of course, that's not counting sales of online subscription services like Safari, which don't fit the downloadable model, but are paid consumption of digital books just the same.)