Why Amazon has lifted Vertical Integration into Perfection
It’s quite interesting to observe the technology market in the recent decade. I think everybody can agree that there has been one giant leap after another when it come to technology and new systems and platforms evolving, not only on the Internet but also on other mediums, like telecommunication or simple TV technology. However, this only works if there is a certain degree of integration, both vertically and horizontally.
Take the example of Apple: What an amazing ride this company has had in the last ten years, and boy how they have transformed basically every industry they have put their food in. The Iphone undoubted has changed the way people treat their phone and the way they do business will be the next. With example emerging where the Iphone basically acts as a device to redeem store credit and can read credit cards, this device has anything but reached its peak when it comes to growth. Integrating ann Application store and connecting it with Itunes to even further increase sales of MP3’s is exactly the type of integration which drives businesses into new heights.
Another field where this slowly but surely becomes apparent is the E-Reader market. With Amazon launching their Kindle and Kindle DX series, integration has in my opinion reached its perfection. Does anybody still believe that normal book stores are going to make it over the next decade or so? Let’s look at the facts: Amazon has already a share of 18% in worldwide book sales, which is incredible. Now they are essentially also offering you a way to consume these books on the spot, for a cheaper price and in a more convenient way than it has ever been possible.
Of course there are a couple if dreamers who think that books will always prevail and that somehow the “romance” is gone when you read on an E-Reader. But lets be honest here: There is only a certain level of money you are willing to spend on romance, I would guess 80% of the worldwide reading is not being done for pleasure but for news consumption and business purposes. What better way to increase the convenience of these occasions than to aggregate the reading in one small device?
However the vertical and horizontal integration for E-Readers will be the essential part of their success. By offering everything from support in the writing process to the reading device where the content is being consumed, Amazon is preparing to give you 100% of the added value of the reading experience, and we would be stupid not to embrace the chance to take on the offer.
Because after all the question is: Is there really an argument to be made AGAINST E-Readers? I believe there is not. It is good for the environment, it is good for news sharing, it is great for real time consumption and, and there I go against what most people currently believe, there is enough romance left in the “reading for pleasure” are if you look at the devices being launched on a weekly basis.
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October 28th, 2009
We were just discussing this the other day that Amazon is the only of the major dotcoms that are still thriving and are cutting edge – are they the U2 and Depeche Modes of rock music.?