As the E-Book World Blossoms, Is There Room for Both the iPad and the Kindle?

We all knew this day would come but it arrived sooner than some of us had expected. On July 19, Amazon announced it had sold more e-books than hardcover books over the past three months. Further, the growth rate in e-books accelerated during that time. In the month leading up to the announcement, Amazon sold 180 e-books for every 100 hardcover books, compared with a ratio of 143-to-100 during the three-month span.

Amazon also said unit sales of its Kindle reader devices had accelerated every month during the second quarter, both on a year-over-year basis and on a sequential basis. The company further noted that growth in Kindle unit sales had tripled since Amazon cut the price of the device to $189 from $259 on June 21, 2010.

There’s a lot that these numbers don’t tell us, starting with the raw numbers of Kindle and e-book units or the revenue associated with those product lines. Growth rates can be dodgy without broader context, particularly if the trend curve starts at a low point.

What we can glean from Amazon’s update is that the e-book business is a vibrant and fast-growing segment of the digital content universe. Analyst Mike Shatzkin, founder and CEO of the Idea Logical Company, predicted that, within a decade, fewer than 25% of books sold would be print versions.

The Amazon figures also suggest that predictions of a head-to-head battle between the Kindle and the Apple iPad may have been overstated. When the iPad launched earlier this year, The New York Times said Apple was on “on a direct collision course with the Kindle.”

However, in the second quarter, Apple sold 3.27 million iPad units, according to the company’s latest earnings report. While there’s no data on how many consumers own both devices, I’d be willing to bet that the overlap is significant.

Jefferies & Company managing director Youssef Squali suggested as much when he said Amazon’s announcement was “clearly an indication that the iPad is complementary to the Kindle, not a replacement.”

Mike Egan of ComputerWorld elaborated on this point by summing up 13 reasons why iPad owners still need Kindles. The main takeaway from Mr. Egan’s commentary is that the iPad does exactly what the Kindle doesn’t, and vice-versa. As long as this remains the case, there should be room for both items in consumer’s gadget wish lists.

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