Technology

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from the L.A. Times

Category: eReaders

Despite strong Kindle sales, Amazon's fourth-quarter disappoints

Amazon.com reports fourth-quarter earnings. Sales rose 35%, helped by strong Kindle sales, but Wall Street analysts had expected better

Despite strong sales of its Kindle devices during the holidays, Amazon.com's fourth-quarter earnings report missed expectations Tuesday, sending the online retail giant's shares plunging in after-hours trading.

The Seattle e-commerce company said its sales rose 35% year over year, to $17.4 billion for the three months ended Dec. 31. But Wall Street analysts had expected sales to rise 40%, to $18.3 billion, according to AllThingsD, which cited FactSet Research. 

Meanwhile, profit plunged 58% to $177 million, or 38 cents a share, as Amazon continued to spend heavily on development and infrastructure to support its Kindle business and other costs. That was compared with profit of $416 million, or 91 cents, in the year-earlier period. 

Amazon, which reported its results after the markets closed, saw its shares quickly fall more than 8.5%, to $177.90, in after-hours trading.

Jeff Bezos, Amazon's founder and chief executive, said "millions" of customers purchased Kindle devices over the holidays, making it the company's best-selling item in the U.S. and Europe. During the nine-week holiday period ended Dec. 31, sales of Kindle e-readers and Kindle Fire tablets increased 177% over the same period last year. The company didn't release exact device sales.

For the first quarter, Amazon projected sales of $12 billion to $13.4 billion, up 22% to 36% compared with the first quarter of 2011. 

The company will hold a live webcast at 2 p.m. PST to discuss the earnings report.

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Tablet, e-reader ownership in U.S. jumps to 19% over the holidays

-- Andrea Chang

Photo: Amazon's Kindle devices at a distribution center. Credit: Chris Ratcliffe / Bloomberg

Tablet, e-reader ownership in U.S. jumps to 19% over the holidays

Kindle-stack

Remember when seeing an iPad on a bus, an airplane or the subway was a startling new experience?  Now you might be startled not to see one.

Over the holidays, so many people bought tablets for each other (and, presumably, themselves), that U.S. tablet ownership nearly doubled among adults, to 19% in January from 10% a month earlier.  The rate is growing quickly: In May 2010, shortly after the debut of the iPad, only about 3% of consumers over age 16 owned tablets, according to survey information from the Pew Internet & American Life Project.

The survey found a similar jump in e-reader ownership, as prices dropped below $100 for electronic book readers from Amazon and Barnes & Noble.  Nearly 20% of U.S. adults now own an e-reader, up from 10% in November.

Tablet and e-reader adoption continues to grow quickly just as sales of traditional personal computers slow and even decline.  In the U.S., PC sales last year had their worst year since 2001, dropping nearly 5% compared with 2010, according to research firm IDC.  Analysts and PC industry executives regularly cite the increasing popularity of tablets when talking about the slowing growth of the PC businesses.

According to the survey, tablet adoption is now the highest among wealthier and more educated buyers.  About 36% of those making more than $75,000 a year own a tablet computer, compared with about 16% of those making $30,000 to $50,000, although ownership rates in both groups appear to be growing quickly. The discrepancy is also substantial between college graduates, 31% of whom own tablets, and high school grads, at 15%.

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Apple's iBooks 2, iBooks Author: Bids to own publishing's future

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-- David Sarno

Photo: Boxes of Kindle e-readers sit at an Amazon.com distribution center. Credit: Chris Ratcliffe / Bloomberg.

Apple's iBooks 2, iBooks Author: Bids to own publishing's future

Apple's new iBooks 2, iBooks Author and iTunes U apps are moves to capture the future of education and self-publishing

NEWS ANALYSIS: Alongside Apple stating that iBooks 2 and textbooks on the iPad would reinvent the textbook as we know it, the iPad-maker announced Thursday that it would also attempt to reinvent book-making by way of an app called iBooks Author.

The Apple-developed app, available as a free download from the Mac App Store, (ideally) makes it easy to make books for the iPad. But together, iBooks 2 and iBooks Author are moves to capture the future of education and self-publishing, and to continue to build on the success Apple had under the late Steve Jobs.

If you've ever used Apple's Keynote or Pages (or Microsoft's PowerPoint or Word) apps, then you should be able to hit the ground running in iBooks Author. There are templates for different types of book layouts, and adding the interactive 3-D models, photos, videos and diagrams that Apple demoed iBooks 2 textbooks on Thursday is as easy as clicking and dragging a built-in widget -- provided you've already produced the video, photos, diagrams and models you want to use.

Apple has even built into iBook Author HTML5 and Javascript support for programmers looking to take their books beyond what the app can do itself; multi-touch interactions for pinch and zoom views of photos and swiping gestures are also included.

Want to see what your book looks like before you publish it to iBooks? Just connect your Mac to an iPad by way of a USB cable and you can preview the book on the tablet.

The aim of the iBooks Author app is to make it easy to get these impressive multimedia elements, as well as questionnaires and other educational materials, into a page of text and published as a book on the iPad as easy as possible -- whether you're a self-publisher looking to write your first book, a teacher whipping up something quick for a special class, or a publishing powerhouse like the textbook trifecta of McGraw-Hill, Pearson and Houghton Mifflin Harcourt.

Before his death, Jobs told biographer Walter Isaacson that he believed Apple could disrupt the $8-billion-a-year textbook industry. Jobs said in Isaacson's book, titled simply "Steve Jobs," that the iPad was the tool to make transformation in the textbook business a reality.

According to the book, Jobs' idea "was to hire great textbook writers to create digital versions, and make them a feature of the iPad. In addition, he held meetings with the major publishers, such as Pearson Education, about partnering with Apple."

Jobs told Isaacson "the process by which states certify textbooks is corrupt ... but if we can make the textbooks free, and they come with the iPad, then they don't have to be certified. The crappy economy at the state level will last for a decade, and we can give them an opportunity to circumvent that whole process and save money."

In announcing the iBooks 2 and iBooks Author products, Apple is beginning to bring a piece of Jobs' long-term vision to fruition. The company also noted Thursday that there are currently about 1.5 million iPads being used in schools and more than 20,000 education apps sitting in its iOS App Store.

But make no mistake, iBooks 2 and iBooks Author aren't just about textbooks. The two new apps are working together to entice students, teachers, educational institutions to embrace and buy the iPad in bigger numbers than they already have.

On Thursday, in announcing the new products, Apple made no mention of new discounts on iPads for students or schools -- though Apple has offered such discounts in the past on Macs and even created special versions of the iMac for schools. Apple even built the now-defunct eMac line specifically to sell to schools.

Apple wants us to ditch the paperback and hardcover textbooks in favor of an iPad and digital downloads, that much is obvious. But the company also wants the iPad and Macs to become to go-to devices for educational institutions and publishing houses.

Although Apple's iTunes is the world's most popular online music storefront, Amazon is the world's largest seller of e-books. By adding a level of interactivity to books that Amazon and others simply can't match, and by making it easier to publish a book and sell it in the iBooks app directly from iBooks Author, Apple has made a move to challenge Amazon and its Kindle e-reader and Kindle Touch tablet as the preferred platform for self-publishers and digital textbooks.

In a statement announcing iBooks 2 and iBooks Author, Apple said as much (without naming Amazon and other e-book rivals such as Google and Barnes & Noble).

"iBooks Author is also available today as a free download from the Mac App Store and lets anyone with a Mac create stunning iBooks textbooks, cookbooks, history books, picture books and more, and publish them to Apple's iBookstore," Apple said.

The apps are also a challenge to Adobe, a company Apple has been known to partner with and feud with from time to time. Adobe's Creative Suite, Digital Publishing Suite and Touch Apps, available on both Windows PCs and Macs, are some of the most popular tools used by publishing houses and self-publishers looking to create a book, whether an e-book or a book before it heads to print.

Though capable of producing many different types of content for a broader range of devices, Adobe's software can cost thousands of dollars, while Apple's iBooks Author app is free.

Apple on Thursday also released an iTunes U app, which allows teachers from kindergarten to the university level to stream video of their lectures and post class notes, handouts, reading lists, etc., all within the app.

Previously, iTunes U was a podcasting service for college professors who wanted to put up video or audio of their lectures. Now it is one more reason for a teacher to consider an iPad and a Mac as tools to reach students at any grade level. And like iBooks Author, the app is free.

In my opinion, Apple is one of the best companies out there at providing lower-cost products that pull consumers into an ecosystem of apps and gadgets. It's one of the reason the company has so many cult-like followers.

For many Apple fans, their first purchase was an iPod or iPhone. With those purchases comes buying apps, music, movies and TV shows from iTunes. And for many, later comes a MacBook or an iMac computer. This strategy is repeating itself with iBooks 2 and iBooks Author.

First, get students and teachers to use more iPads in school by offering affordable and engaging digital textbooks. With iBook textbooks capped at a price of $14.99, I have to wonder whether or not textbooks will become shorter and more narrow, and thus students and teachers we'll have to buy more of them. Second, make it easy for anybody to produce their own iBooks (textbooks or otherwise) and then sell those books in the iBooks app, luring in aspiring authors. When those students, teachers and authors go to download music or a movie, set up a cloud storage service or buy a laptop, a phone, a new tablet -- maybe someday a TV -- what brand will be at the top of minds? Apple.

iBooks, iBooks Author and iTunes U, together are a move to fend off Google, Amazon, Adobe and other competitors in determining the future of education, publishing and book reading. Together, the launch of these apps is an attempt to not only maintain but also expand Apple's current success into the company's post-Jobs future.

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-- Nathan Olivarez-Giles

Nathan Olivarez-Giles on Google+

Twitter.com/nateog

Photo: Apple's iBook Author app on an iMac, and an iBook and an iPad. Credit: Apple

Barnes & Noble considering selling Nook business

Barnes & Noble Nook Tablet

Barnes & Noble said Thursday that it is evaluating the possible sale of its growing Nook e-reader and tablet business, which hit a record level of sales over the holiday season.

"We see substantial value in what we've built with our Nook business in only two years, and we believe it's the right time to investigate our options to unlock that value," said William Lynch, Barnes & Noble's chief executive, in a statement. "In Nook, we've established one of the world's best retail platforms for the sale of digital copyright content. We have a large and growing installed base of millions of satisfied customers buying digital content from us, and we have a Nook business that's growing rapidly year-over-year and should be approximately $1.5 billion in comparable sales this fiscal year."

"Between continued projected growth in the U.S., and the opportunity for Nook internationally in the next 12 months, we expect the business to continue to scale rapidly for the foreseeable future," Lynch said.

Shareholder's weren't particularly pleased Thursday with the idea of spinning off Barnes & Noble's Nook business into a separate company or selling the Nook unit altogether.

Shares of the New York-based company fell about 20% on the news of a possible spin off, which also came alongside word that the bookstore chain also expects "full year losses per share to be in a range of $1.40 to $1.10."

Holiday sales at Barnes & Noble retail stores rose 2.5%, to about $1.2 billion, over the last nine weeks of 2011 when compared with the same period in 2010. Meanwhile, during that period, sales of Nook devices and digital content rose 43% from a year earlier.

The company also said it was "in discussions with strategic partners including publishers, retailers, and technology companies in international markets that may lead to expansion of the Nook business abroad."

As for how long Barnes & Noble will take to decide just what it will or won't do with its Nook unit, the bookseller isn't saying.

"There can be no assurance that the review of a potential separation of the Nook digital business will result in a separation," Barnes & Noble said. "There is no timetable for the review, and the company does not intend to comment further regarding the review, unless and until a decision is made."

Barnes & Noble didn't release specific sales numbers for Nook devices, or for the sale of Nook e-books, apps and other digital content, but it did say that even in that segment of its company there is some mixed performance.

For the last nine weeks of 2011, digital content sales grew 113% from the same period 2010 and overall sales of Nook devices were up 70% from a year earlier, setting a new holiday record for the company.

But sales of the Nook Tablet "exceeded expectations, while sales of Nook Simple Touch lagged expectations, indicating a stronger customer preference for color devices," Barnes & Noble said.

[Updated 5:19 p.m.: Barnes & Noble fell Thursday $2.32, or 17%, to close at $11.23 per share.]

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Photo: Barnes & Noble Nook Tablet. Credit: Armand Emamdjomeh/Los Angeles Times

Kindle Fire continues streak as Amazon's top selling item

Amazon Kindle Fire tablet

The Kindle Fire tablet has, since its launch, sold more units than any other single item on Amazon.com.

But just how many tablets sold would that be exactly? Amazon isn't saying. As is the company's typical stance with its Kindle products, the Seattle company isn't offering up specific sales numbers.

Instead, on Thursday, the world's largest online retailer issued a statement saying that "2011 was the best holiday ever for the Kindle family as customers purchased millions of Kindle Fires and millions of Kindle e-readers."

As noted by our sister-blog Jacket Copy, so far this month, the Kindle Fire tablet and the Kindle and Kindle Touch eReaders, have sat in the top three spots for most sold items on Amazon.com, with the Fire ranking first, the Kindle Touch in second and the standard Kindle in third.

The retail giant also said that the Kindle Fire is the item most often found on Amazon.com wish lists too.

Without exact sales numbers, it's tough to judge just how well the $199 Kindle Fire is selling or whether or not it will reach analyst estimates of 5 million tablets sold before the end of the year.

Despite Amazon's continued stance on not disclosing how many Kindle Fire tablets it's selling, many analysts still project that the device will become the second-best selling tablet behind Apple's iPad.

Amazon also said that this Christmas Day was the "biggest day ever for Kindle book downloads" and that the No. 1  and No. 4 best-selling Kindle eBooks released in 2011 "were both published independently by their authors using Kindle Direct Publishing," Amazon's digital publishing platform.

"We are grateful to our customers worldwide for making this the best holiday ever for Kindle," said Jeff Bezos, Amazon's founder and CEO, in the statement.  "And in a huge milestone for independent publishing, we'd also like to congratulate Darcie Chan, the author of 'The Mill River Recluse,' and Chris Culver, the author of 'The Abbey,' for writing two of the best-selling Kindle books of the year."

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Photo: The Amazon Kindle Fire tablet. Credit: Armand Emamdjomeh / Los Angeles Times

Still shopping? Amazon launches Best of Digital store

Amazon opens its Best of Digital store.

Haven't gotten that holiday shopping wrapped up just yet? Amazon.com, the world's largest online retailer, has plenty of stuff to sell and on Thursday launched a Best of Digital store full of items it recommends.

As the name would suggest, the items for sale in Amazon's Best of Digital store aren't physical goods. The store, which is a section of Amazon's website, has for sale mp3 music files, not CDs; downloadable movies, not DVDs or Blu-ray discs. Apps, games, magazines, e-books (for Amazon's Kindle e-reader, of course) and software for home PCs are on the list as well.

Launching such a store after the start of Hanukkah and so close to Christmas might seem like odd timing, but "historically, Christmas Day is the largest day of digital sales on Amazon.com, followed by Dec. 26," Amazon said in a statement.

"Last year, from Christmas Eve through Dec. 30, Amazon customers purchased over three times more digital content, including Kindle books, magazines, movies, TV shows music, and digital games as compared to the weekly average for the year," the company said.

Not at all a coincidence, all the digital items (except for the PC software) for sale in the Best of Digital store can be read, watched, listened to, played and used on Amazon's new Kindle Fire tablet.

"With the introduction of Kindle Fire this season, millions more customers will be shopping for new digital content," Craig Pape, Amazon's director of music, said in the statement. "This year we're making it easier and more convenient than ever to get all the content they want."

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Image: A screen shot of Amazon's Best of Digital store. Credit: Amazon.com

Amazon Kindle Fire software and Kindle iOS apps updated

Amazon Kindle Fire software updated
Amazon updated its Kindle Fire software and iPhone and iPad apps this week, adding new features all around.

For the Kindle Fire, Amazon's first tablet and a hot-selling item, the update promises to improve the responsiveness of touch navigation and the speed of actions on the device, such as loading webpages in the Fire's Web browser.

However, the biggest new feature might be the ability for users to edit what shows up in their "carousel" of recent apps and content displayed on the Fire's home screen.

Before the update, a Fire user couldn't remove any items -- books they've read, games and music played, movies watched or websites visited -- in their carousel.

The ability to remove items from the carousel was a highly requested feature and in this case, Amazon was pretty quick to deliver -- the Fire was released Nov. 14.

The iOS Kindle app updates the user interface for periodicals and text books, with access to the same selection of more than 400 magazines and newspapers that are offered on the Fire, Amazon said in a statement.

For the first time, Amazon is also offering "print replica textbooks" to iOS Kindle app users, which allow for full-color pages and the ability to zoom in and out or take notes as needed, the company said.

And the update also now makes the Kindle iOS app a PDF reader as well, Amazon said, which will allow users to view their own documents -- a feature offered by iBooks for some time now.

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Photo: The Amazon Kindle Fire tablet. Credit: Armand Emamdjomeh / Los Angeles Times

Amazon selling more than 1 million Kindles a week

For the third week in a row, Amazon has sold more than 1 million Kindles a week

For the third week in a row, Amazon has sold more than 1 million Kindles a week. During that time, sales of its Kindle Fire tablet have increased week over week, the e-commerce giant said Thursday.

Amazon said its first tablet, the $199 Kindle Fire, is the bestselling, most-gifted and most-wished-for product on the website. 

Dave Limp, vice president of Amazon's Kindle division, said the Seattle-based company was building "millions more" tablets to meet the high demand and noted that demand was accelerating.

Kindle's family consists of the Amazon Fire, the $79 Kindle, the $99 Kindle Touch and the $149 Kindle Touch 3G.

"Our family of Kindle e-ink readers are close behind Kindle Fire on the Amazon.com bestseller list," Limp said. "Customers continue to report preferring their Kindle e-reader for long-form reading, and in fact we've seen many customers buy two Kindles –- both a Kindle Fire and a Kindle or Kindle Touch –- this holiday season."

This week, Amazon said it would provide a software update to Kindle Fire owners that will fix some of the tablet's issues, such as a finicky touch screen. The company said it would release the over-the-air update in less than two weeks.

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Photo: Amazon's Kindle Fire. Credit: Mark Lennihan / Associated Press

‘Steve Jobs’ tops Amazon’s list of 10 best-selling books of 2011

Stevejobsbooks

Amazon.com on Monday announced its best-selling books of the year, and -- no surprise -- Walter Isaacson's biography of Apple visionary Steve Jobs landed in the No. 1 spot.

The online retail giant's list combined its sales of print and Kindle editions and took into account only paid copies. Books first published before 2011 were excluded.

Amazon noted that two books -- "The Mill River Recluse" by Darcie Chan (#4) and "The Abbey" by Chris Culver (#9) -- were published by Kindle Direct Publishing and made the top 10 based solely on Kindle sales.

"Steve Jobs" topped the list even though it was published just two months ago. Sales of the book "have been phenomenal in both formats," said Chris Schluep, senior editor of books at Amazon, said  that even though "Steve Jobs" was published just two months ago, sales "have been phenomenal in both formats." 

Here's the complete list: 

1. "Steve Jobs" by Walter Isaacson

2. "Bossypants" by Tina Fey

3. "A Stolen Life" by Jaycee Dugard

4. "The Mill River Recluse" by Darcie Chan

5. "In the Garden of the Beasts" by Erik Larson

6. "A Dance with Dragons" by George R.R. Martin

7. "The Paris Wife" by Paula McLain

8. "The Litigators" by John Grisham

9. "The Abbey" by Chris Culver

10. "Inheritance (The Inheritance Cycle)" by Christopher Paolini

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Photo: Copies of Walter Isaacson's "Steve Jobs" at a Costco in Mountain View, Calif. Credit: Paul Sakuma / Associated Press

Kobo Vox tablet review [Video]

The Kobo Vox tablet feels like a missed opportunity.

Over the last year, the scrappy Canadian e-reading company has released the impressive Kobo Touch eInk eReader and polished its Kobo Reading Life apps into worthy rivals to Amazon's Kindle apps and Barnes & Noble's Nook apps on tablets and smart phones.

The company is in the process of being purchased by Japan's equivalent to Amazon, the massive online retailer Rakuten. Despite Kobo's largest U.S. retail partner, Borders, closing its doors, it seemed that Kobo was akin to a promising, aspiring prizefighter on the brink of being ready to challenge the heavyweight champs of e-reading, Amazon and Barnes & Noble.

The Kobo Vox, on top of a Amazon Kindle Fire and a Barnes & Noble Nook TabletAnd then I used the Vox -- Kobo's answer to Amazon's Kindle Fire and Barnes & Noble's one-two punch of the Nook Color and Nook Tablet.

With the Vox, Kobo has taken a step back, delivering a product that doesn't come close to its rivals and one that doesn't match up to the quality I expected given how much I like the Kobo Touch and Kobo reading apps on Google's Android and Apple's iOS devices.

On paper, the Vox looked like a smart move, selling for $199.99 and featuring a seven-inch touch-screen with eight gigabytes of built-in storage -- that's the same included storage and price as the Fire and the same as the Nook Color (the Nook Tablet sells for $249). Just as the Nook Color and Nook Tablet do, the Vox features with a MicroSD card slot, which can accommodate a card of up to 32-gigabytes in size, if you don't mind buying one.

Like the Fire and the Nook, the Vox runs a modified version of the Android Gingerbread operating system, designed by Google with phones, not tablets in mind.

But unlike those two others, Kobo has only made minimal changes to Gingerbread, most noticeably pinning reading-related functions to the bottom of the Vox's Android home screens.

I was hopeful Kobo would deliver a competitive product, but instead I found myself disappointed at just about every turn in using the Vox.

The hardware, from the outside, isn't bad looking. The back of the Vox is great to hold on to, with Kobo's signature quilted pattern rendered in a soft and grippy plastic. On the review unit I tested, a light-blue rim of plastic sat between the back of the Kobo and its 1020 x 600 pixel resolution display.

It's nice to see a company take a bit of risk design-wise, especially when compared with the boring looks of the Kindle Fire. The Vox is also offered with lime-green, pink and black rims.

But once I turned on the device, it was mostly downhill.

The Vox starts up slow, and I failed to ever reach the seven-hour battery life Kobo claims for the Vox. I usually got about four or five hours of battery life, but there were about four times in my week of testing that the device would shut itself off when falling below an 80% charge (a couple of those delays struck when we were shooting the above video).

When the Vox was up and running, it did so sluggishly. Loading apps, menus, Web pages; checking email; opening e-books; turning pages in e-books -- everything took place slowly. It felt as though the Vox was always a step, or a second or two, behind my touch input. The display also fails to match the clarity, brightness, color range or viewing angles of the Fire and the Nook Tablet.

Snappy, speedy, responsive -- these are not words I would use to describe the Vox. Too often I found myself staring at a rotating gray circle waiting for something to load. This complaint can partly be attributed to lower-end internal specs, such as an 800-megahertz processor and 512-megabytes of RAM, but if tuned enough with the right software, such hardware shouldn't be so slow.

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