iPad, Google Could Slash Kindle E-Book Share From 90% to 35% [E-Book Market To Grow, But Kindle's Dominance To Wane]

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Credit Suisse analyst Spencer Wang issued a report Tuesday suggesting that the dominance of the Amazon Kindle could drop from 90% to 35% in just five years.  The entry of the Apple iPad and the growth of Google Books could split Amazon’s near-monopoly control of the e-book market.

The first crack in the Amazon Kindle’s control of the e-book market came with the mandatory price hike of an agency pricing model issued by publishers like Macmillan and Hachette.  The e-book price increases pushed Amazon’s pricing model on par with the prices of the iPad-focused iBook store from Apple.  Amazon’s loss of cost-leadership meant that Amazon would have to compete with Apple and other device manufacturers on hardware offerings, since their prices alone were no longer a point of differentiation.

On the hardware front, the iPad itself poses a significant risk to the Amazon Kindle hardware.  Add to this a flurry of tablet pc releases and next-gen e-book readers, and Amazon will be forced to compete on the unfamiliar ground of hardware development.  In total, these competitive factors could push the e-book market dominance of the Amazon Kindle from 90% to 35% in just five years, says Spencer Wang of Credit Suisse.