image I’m not a securities lawyer. The U.S. Securities and Exchange Commission may or may not be able to force Amazon to release the raw Kindle unit sales numbers, but Jeff Bezos and friends sure as hell had better stop playing games with investors and consumers.

Technically an Amazon news release was right on the money in saying the Kindle unit sales growth rate tripled after the lowering of the Kindle 2’s price from $259 to $189. But that’s not the same as triple unit sales. Paul Story has explained the difference (go here and here), and hats off to him and others for this catch and additional analysis of Amazon’s ballyhoo (also see TeleRead Editor Paul Biba’s own skepticism). Our headline now reads, “Kindle growth rate triples,” rather than, “Kindle sales triple.” Significantly, TeleRead was not alone. For example, I see that Slate’s Big Money site still says: “With three times as many Kindles selling, the number of Kindle editions is growing at a geometric rate to the increase in device sales." B.M was wrong about the “three times,” if nothing else. Hello, SEC? Think of ordinary investors.

Luckily Paul Story was around to help alert us to Amazon’s tricks. The value of this blog isn’t just in the original posts, but in community members’ comments like his, and while I’m no longer editing TeleRead, I’m pleased to see members’ outspokenness persist. To share the Amazon release with you in a timely way, Paul Biba put it online without detailed analysis. But as he would undoubtedly see it, a release should be just a starting point for discussion. This is a major difference between dead-tree publications and interactive media.

Meanwhile, think of the investors and consumers who are not reading the Amazon stats in TeleRead and hence are not benefiting from the closer look that our savvy community members can help provide. Post Enron and post Madoff, the SEC needs to be more aggressive in protecting investors. I doubt that Amazon is Enron II, I know  it has many virtues and, in fact, I’m a steady customer. But I’d feel better about the company if it stopped teasing us with data like sales growth rates without providing more context. Raw unit sales numbers for the Kindle, please.

Just what the devil were the unit sales rates growing from? Bacteria colonies multiply fast. But that doesn’t necessarily mean that tomorrow they will be the size of Alaska, not when bacteria are small to begin with. Some might say, “Well, other companies do the same as Amazon.” If so, then that’s just one more indication of the need for the SEC to serve Main Street rather than Wall Street—especially in policing industries as complicated as e-bookdom and publishing in general.


  1. I’m not a securities lawyer either, but I don’t believe that a company has to separate any particular source of revenue until that source of revenue is 10% or more of total revenues. Outside of that requirement, companies release numbers when they see a competitive advantage to doing so. Apple releases iPad numbers because they want to discourage other entries to the market. Microsoft didn’t release Kin numbers because they were bad.

    Amazon’s press release clearly said growth rate; I don’t see how that is “playing games.”

  2. Thanks for the attribution, David.

    While there’s every reason to believe that Amazon’s release is deliberately vague and therefore prone to errors of interpretation, I personally don’t have a real problem with it. We just need to be careful when trying to figure out what’s behind the figures. Indeed, in a later statement (comparing 1st half of 09 with the same this year) there has been a tripling (of ebook sales).

    “…Amazon sold more than 3x as many Kindle books in the first half of 2010 as in the first half of 2009…”

    According to, Wired made the same error. It’s easy to do.

    I am a Kindle fan and think these stats are great. They are tricky but I don’t think it’s Amazon’s problem when we make a mistake.

  3. I read the press release and didn’t find it at all misleading. The stats were clearly laid out. The performance was specifically about e-book sales — something Amazon investors care far more about than the sale of Kindle hardware.

    I also don’t see the relevance to anyone except a competitor on how many Kindles were sold. Toshiba does not reveal sales figures for its TV, laptops or other devices; why do you feel the SEC should “force” Amazon to do so?

    Amazon’s press release states: “Amazon sold more than 3x as many Kindle books in the first half of 2010 as in the first half of 2009”

    I’m still looking for the so-called “tricks”.

  4. Sherri and Paul S…

    Sherri: Thanks for your thoughts, but I think that if nothing else, voluntary release of the numbers by Amazon would be terrific. It’s a major part of e-bookdom whatever the numbers. The whole industry has an interest in this information, especially given all the hype that plagued e-bookdom a decade ago. The more specifics, the more capital investors can confidently entrust the industry with (assuming that demand for products is at a certain level).

    Paul: Glad to give credit. I’m more concerned than you are about Amazon’s hype, but, hey, we’re both trying our best to be fair-minded. And thanks for the discovery about Wired’s own goof. Paul’s daughter has done work for Wired–and now they can have a good laugh over this. No matter what the topic, keep those great comments coming!


  5. Alexander I:

    I’d respectfully disagree. When Wired, a branch of Slate and TeleRead all say that unit sales tripled–when they didn’t–that suggests the need for better language. Release of the actual numbers would help put things in context.


  6. It’s not just Wired, Slate, and TeleRead.

    Bloomberg reported it as, “The pace of Kindle sales also has tripled since the company cut the price…”.

    Forbes reported it as, “ says sales of its Amazon Kindle have surged since it cut prices on the e-reader device.… triple the number of Kindles were sold in the first half of 2010 versus 2009.…”

    MarketWatch says, “unit sales of its Kindle e-reader device have tripled since the company cut the price…”

    ABC News says, “Sales of the Kindle have tripled since Amazon cut the price…”

    The CBC says, “Kindle e-book reader sales have tripled since it dropped the price…”

    The Washington Post says, “The pace of Kindle sales also has tripled since the Internet retail giant cut the price…”

    The Los Angeles Times wrote, “Amazon said sales of the device tripled…”
    The Wall Street Journal, The Financial Times, and The New York Times seem to have avoided any mis-steps.

  7. public companies have to report revenue and earnings in a way that is similar to how they are internally organized.

    Amazon reports to the SEC with North America and International business units. They provide some supplemental reporting of sub-businesses in these two big operating units (media, electronics and other general merchandise, and other). I would guess the Kindle HW is in electronics and other general merchandise and the Kindle books/news/mags are in media. I would not expect Amazon to divulge any real numbers anytime soon as it is not really in their best interest.

    For how and what they report see an example in their 10-Q on pages 18-20 here

    Re: Sherri’s comment, firms have to list customers who are more than 10% of revenue, not products or lines of business.

  8. Wow, so many media outlets got it wrong. I didn’t misinterpret it for a second. I’m no genius by any means, but I did take the time to actually read and think about what they said.

    All this says to me is that the people reporting on this stuff are either lazy or don’t understand some fairly basic math.

    Your outrage, going so far as using profanity, is misdirected, in my opinion. Reporters are obligated to report accurately. They were given accurate information and were too lazy or ignorant to interpret it properly.

  9. @Doug
    The Wall Street Journal, The Financial Times, and The New York Times seem to have avoided any mis-steps

    So in a story about e-media, the blogs all got the facts wrong, and old-fashioned newspapers got it right!

  10. The language is very specific.

    Words have meanings, guys. Read the words, understand them, THEN write your headlines.

    You know why so many outlets botched it? I bet they didn’t even read the release. They read some other outlet’s story about the release. Because there is no one in the world lazier than a reporter.

  11. “…but Jeff Bezos and friends sure as hell had better stop playing games with investors and consumers.”

    Still can’t let that go eh David?

    I’m an Amazon shareholder and customer and while I would be curious to know the actual sales numbers I’m not sure that the corporation has any real compelling reason to satisfy the curiosity of myself and many others.

    Actually, it is probably better, from a business perspective at least, for Bezos to continue to dance around the issue. After all the actual numbers of Kindle’s sold is really not totally relevant to the end game.

  12. I’m very much with David on this issue. TeleRead must be the only blog read by Amazon’s defenders, as the balance of comment notes Bezos’s/Amazon’s continuing failure to (a) provide useful numbers while (b) issuing press releases that are carefully designed to allow for varied interpretations. (The only other conclusion is that the PR department at Amazon is staffed by the semi-literate, which I doubt.)

    Consider the basic premise of yesterday’s release and the headlines generated. Amazon offers a tiny morsel of sales data comparing the most expensive and cumbersome book format, favored by a minority of buyers, with the least expensive (on Amazon) and most portable of formats. Bezos/Amazon subsidize the price of e-books to build marketshare. Good strategy perhaps, but this only adds to the skewed sales data.

    Paperbacks outsell hardcovers 3-1. Where is that comparison? The latest e-book association figures (IPDF) reveal that despite a 350% YTY sales increase e-books will account for less than 5% of overall U.S. book sales this year.

    Come on, Jeff. Stop insulting our intelligence. Only half the press outlets still regurgitate this pap undigested. The rest have caught on to your game.

  13. Thad implies that if we disagree with David that we are Amazon defenders. That seems to be an attempt to deflect criticism away from the people who really messed up here.

    Without passing *any* judgment on Amazon at all, I can still have an opinion about how people reported on this issue.

    A group of blogs and reporters who cover ebooks on a regular basis and do things like analyze market share and market growth should be able to understand a simple term like growth rate. This is not advanced mathematics.

    Literacy and good reporting skills are important if you are reporting news. The media defenders (see what I did there 🙂 seem to be mad because their group largely got egg on their face for displaying neither in this case.

  14. Press releases are PR propaganda released to put the absolutely best face the company’s PR flacks can on whatever issue the press release addresses. Vague language and tricks in phrasing are all quite deliberately and carefully arranged to deceive. Anyone who disputes this is either (a) naive or (b) accustomed to dealing with companies that are run quite differently from bit American corporations today.

    Amazon — trust me — did absolutely want us to read ‘sales tripled’ when they said, quite carefully, ‘sales growth tripled.’

    By not releasing the actual numbers, now or ever, Amazon is hiding something. Just accept this as the most likely truth. Language like this in their press release is all geared toward making us believe they are selling more Kindles, and more ebooks, than they are in fact.

    Amazon wants to create the impression that they are an unstoppable juggernaut in the ebook device and edition markets. Maybe they are; but if the raw numbers truly supported that contention, and I were Mr Bezos, I would certainly put out the actual sales numbers, I would do so in both Press Releases as well as official reports to stockholders, and I would challenge the competition to do the same.

    By concealing those numbers, Mr Bezos and company give us every reason to believe that Amazon is NOT the unstoppable juggernaut they pretend they are.

    And we should all, press and public alike, proceed on that assumption.


  15. asotir says: “Amazon — trust me — did absolutely want us to read ‘sales tripled’ when they said, quite carefully, ‘sales growth tripled.’”

    No question about that… clearly they have a strong interest in putting their best foot forward and making their numbers sound as good as possible.

    It’s up to responsible and intelligent journalists to make sure the numbers are reported accurately. Where were they?

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