There was a lot of excitement in the e-book world this week after both Barnes and Noble's Nook and Amazon's Kindle slashed their prices to help them compete against the iPad, and against each other. For some reason, this has also led a few book industry pundits to suddenly declare that the Kindle is the big winner in the e-book technology face-off.
Oh, how I wish I could short the Kindle's stock. (Yes, I know I could short-sell Amazon's stock, but that's not the same thing). In fact, I'd short any e-reader's stock. I've lived through this kind of technology/money hype before, and I know how hollow the hype can be. Like the famous dot-com boom of the 1990s, the current explosion of interest in e-book technology is not based on actual consumer interest, but rather on the hope for a financial bonanza. How can you tell when a great new trend is a bunch of hype? When more people write articles about a new product than actually use or buy the product, that's a pretty big sign.
In the late 1990s, a stupid idea like Gazoontite.com (the online service for allergy sufferers!) could raise millions of dollars in advance funding even though the actual service was completely, laughably bad. The Silicon Valley and Silicon Alley bankers and executives who talked up these new ventures must have known in their guts that the products they were launching lacked consumer appeal. But the hype became the product, became the basis of investment. I see the same type of ugly mess brewing with e-book technology today. Lots of people want to invest in e-book readers, and fewer people want to use them. As of the summer of 2010, as far as I can tell, the paperback book remains the single most practical, effective and attractive format for book-length reading. The iPad is probably the most exciting (if far from satisfactory) electronic device, and all the other e-book readers are far behind and looking more hopeless every day.
For over a year now, the business conversation about e-books has taken place in future tense. This is an obvious bad sign in itself. When Les Paul invented the electric guitar in 1940, there were no music trade journals opining endlessly about how the electric guitar was going to change music forever. When the first commercial microwave ovens hit the market in the early 1970s, or when digital photography wiped away the film industry in the past decade, these changes made themselves felt quickly and quietly. Nobody had to write long, pained articles -- or entire pained books -- about the revolutions these products created. A real product revolution happens so quickly that nobody has time to write about it until it's over. Anybody who writes about a successful marketing revolution in future tense is not worth listening to.
I care about electronic reading, and I'm worried that a financial bubble market based around e-book technology will leave the important and innovative field in a shambles the same way the dot-com bubble and crash of 2000 left the website business a shambles (until about 2004, when the new age of social networking allowed the industry to come back to life). I want more balanced and more skeptical coverage of the e-book device market. Articles like Ed Nawotka's at Publishing Perspectives are a refreshing break.
Investors, publishers and pundits: here's the key question to ask, when you want to reality-check the hype you're hearing about some new device that makes electronic reading a breeze: have you run out to Best Buy and bought this device yet yourself? If you haven't, that tells you all you need to know. When a product is good enough to really cause a revolution, you'll already own it.