Google to challenge Amazon Kindle

Some book publishers worry that Amazon (AMZN) will dominate the e-book market the way that Apple (AAPL) controls the music download business. When one company has a huge market share in content distribution it can often set pricing, hurting content company margins.

Google (GOOG) means to challenge Amazon in the digital book business and publishers assume that they will benefit. The Google e-book program will apparently let content providers to set their own prices.

According to The New York Times, "Google signaled its intent to introduce a program that would enable publishers to sell digital versions of their newest books direct to consumers through Google." The book content will probably be downloaded onto PCs and other devices and can be stored to be read later.

The Google program has two advantages over Amazon's. The first is that the Google search function may make it easier for consumers to locate content. The second is that the content from Google is not tethered to one device, while Amazon's downloadable books are only for use on its Kindle reader, which has a distribution base far smaller than PC and portable electronic devices do.

The Kindle and its book download business were supposed to be "the next big thing" for Amazon's earnings. If competition begins to move into the market with any force, the Kindle could still be a bust.

Douglas A. McIntyre is an editor at 24/7 Wall St.


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