Could we be getting closer to a free Kindle—but not one provided by Amazon?

The rapid price drop of the Kindle led some to speculate that, if prices kept falling at the same rate, it would be free by the end of this year. It doesn’t look like that is going to happen, but the prices sure have fallen, haven’t they?

Rumors have long been with us about free Kindles. In 2010, Mike Arrington heard from someone claiming Jeff Bezos was considering giving free Kindles to all Amazon Prime subscribers. More recently, Amazon reps told an AllThingsD reporter that they still couldn’t work out the economics of such a givewaway (though that was before the latest price drop).

A couple of years ago, the Alley Insider estimated that, if the New York Times stopped printing the paper edition of its paper, it could afford to give all 830,000 print subscribers two free Kindles every year. Back then, the price was $359, and now the cheapest model runs considerably less than that. Indeed, at $79, you could buy five Kindle Classics for the cost of the original $399 device.

On Memeburn, columnist Martin Carstens wonders whether the decreasing price of the Kindle might make it more economical for newspapers to consider going that route: giving subscribers free Kindles in exchange for being able to reduce the amount of physical papers they have to print.

I wonder, if in fact, we should be looking to content creators and large institutions like the New York Times rather than Amazon to answer our question [whether the Kindle will ever be free]. When the economic logic of going purely digital becomes sound, news institutions like the New York times could be the key to forcing a free Kindle.

When that happens, it could be a pivotal moment in history, the final death knell to the traditional print newspaper, as digital devices become the new standard for consuming news

Of course, as I pointed out when I covered the Alley Insider’s calculations, the fly in the ointment is print advertising revenue. Print advertising still makes up the bulk of newspapers’ revenues, and if they eliminated print they’d also eliminate that advertising revenue. Of course, they’d also eliminate a lot of expenses. The question is whether the papers could also eliminate enough costs by giving away the devices to be able to continue making a profit on what they had left.

Sooner or later, newspapers will have to figure out how to make the transition. And if the Kindle keeps getting cheaper, the question might not always be a theoretical one. How low will the price be by the end of next year?

3 COMMENTS

  1. I think as long as a printed edition of the paper is available, there will be a significant portion of subscribers who prefer that tangible newspaper to hold in their hands. I know many people who have Kindles and Nooks that only use them for travels because they prefer reading the book to the electronic device. I also think that if the papers do away with print altogether and users are forced to an electronic version of the paper they will lose reader loyalty for another news outlet online. Internet users aren’t loyal like newspaper readers are!

  2. The price of the reader is quickly forgotten, but the price of the subscription only becomes more painful over time. NYT and others are still trying to charge too much for online access. And let’s not try to tell ourselves that NYT on a 5.7″ screen is as enjoyable as the print edition.

    It won’t matter anyway – by the time a big media company like NYT got an offer like this together, everyone will already have an eReader. Too little and too late.

  3. Leigh wrote: “I think as long as a printed edition of the paper is available, there will be a significant portion of subscribers who prefer that tangible newspaper to hold in their hands.”

    A fair point. But the real question is the price of those paper editions …If POD spreads, as I believe it will, paper will indeed have a long tail.

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