BizThoughts

Guess what's been on my mind? Yup, the Amazon Kindle. How'd you guess?

While it's enlightening to praise and debate, I know it has quite a few improvements to make before it rocks the market. Sure, it has more promise than it's competitors, but if it doesn't maintain its lead, than I'll be a sad panda.

Here's my wish list of what Amazon needs to do to improve the Kindle for v2 and beyond:

• Improve it's ergonomics (hardware) and usability (software). This is probably its most well-known criticism. Hopefully they'll follow the principles of KISS.

• Continue getting more content. That means getting more publishers to release their books in e-book format. Probably not an easy task, but if anyone has the clout to do it, it's Amazon.

• Allow more formats to be readable. They don't necessarily have to be writable for now, just readable. Like PDF, PPT, and XLS file formats. (To their credit, they already support TXT, HTML, and DOC.)

• Allow readers a way to somehow "transfer" their existing books into the Kindle. I'm not sure how this could be done, as it leaves many openings for abuse. But I'd love to digitize my current library into the Kindle without having to buy all of those books again. Ugh.

• Add a touch screen interface. Touch screen UIs are nice and generally easy-to-use (if done right). They could add significantly to the usability of the Kindle—again, if done right.

• Offer a color screen. At least, as an option for some people. I'm sure this is on their internal wish list already.

• Offer a backlit screen. This could also be an option, as some people may feel its current state is better on the eyes.

• Offer multiple versions. They could differ in size, storage space, and maybe even color and outer material (imagine a leather-bound Kindle! Hmm!). If/when the Kindle catches on with younger consumers, the market for personalization accessories could be sizable too.

• Strengthen its body. Books have to survive quite a rough rumble and tumble. It would be cool if the Kindle could survive that kind of physical stress too. Perhaps this could merely be another version.

Go go Kindle go!

I'm having a fun ole' debate over the Amazon (AMZN) Kindle right now. It's taking place in the comments of a previous post between myself and Nicholas Zakas, a published author, seasoned programmer, and all-around intelligent guy.

I like debates. They give me a chance to hone my opinions and positions on various topics. I'll do my best to defend my position, but more often than not, I'll learn a new viewpoint that adds to my knowledge of that topic.

My post was about how great the Amazon Kindle was going to be. I likened the Kindle to Apple's (AAPL) iPod. Nicholas commented that:

The iPod was successful largely because people wanted to replace their large portable CD players with something that could play more…it wasn't techies that make the iPod the sensation that it was, it was the non-techies.

This implies it was the iPod's ease-of-use that made it such a commercial success. While I totally agree, I think it was more than just the iPod's simple & friendly form factor that made it great. It was also:

1. iPod's branding and Apple's great overall brand
2. The "complete package" that iTunes integration offers to the iPod

He argued that while this is true for iPods, it's different for books:

There's something about the tactile relationship between readers and their material that makes it hard to give up. I remember when people predicted that newspapers would go out of circulation when people could get their news online…

True, but the same was once said about records when first CDs came out. There was a time when people predicted the TV would replace the radio. And later, that interactive TV would replace regular TV. I've never believed that newspapers would go out of circulation, but I do believe their role will change—and has already changed. It's no longer the single source of up-to-date news. People primarily go to the TV for that now. (Those that go to the web for up-to-date news are still in the minority, though it's growing rapidly.)

He also made a comment about the Amazon Kindle falsely gaining a first-mover advantage, though the Kindle isn't the first e-book reader on the market; there are quite a few already. While he's probably just not as familiar with the e-book market, we both agree that first-mover advantage isn't a panacea for success.

To that, he followed up with a simple mathematical point:

Considering you can get great books for under $10 nearly anywhere, what would you do? Buy a $400 machine to output text, or buy 40 books? I love tech as much as the next computer geek, but even I would go for the latter.

Good point. If you're someone who will only buy forty $10 books, you'll hardly see any cost-savings benefit in the Amazon Kindle. But if you're someone like me, who's been known to spend upwards of $800 on books a year, the Amazon Kindle may be worth it.

But then this goes into the question of target demographics, which Nicholas also pointed out:

Tell me who [the target consumers] are for Kindle? People who read books like books, not just the text. The divergence between book readers and technology couldn't possibly be greater. People often read books to escape computers and technology.

I can't disagree with that. As a bookworm myself, I also love the tactile feel of a book. However, I used to love the tactile feel of a CD booklet too. Every time I'd listen to a CD, I'd read the booklet for the lyrics or linear notes. Or maybe just stare at the album cover art. I loved doing that. When MP3s first hit the market, I didn't see the appeal because they felt so ethereal and amorphous. There wasn't anything I could hold in my hands.

Then I hit a tipping point and realized that the portability and physical space savings of MP3s offset the benefits of having CD booklets for me. The same went for digital movies and DVDs. Now, I love digitizing all of my media.

What may tip the balance of books to e-books are the younger generations of consumers. They're already growing up with the Internet, mobile phones, and MMORPGs (with their virtual goods) as everyday items in their lives. It's foreign for them to imagine a world without technology like that. They also don't place as much value on CD booklets, DVD boxes, or books in the same way the older generations do—younger generations seem all-to-eager to accept digital media.

Just like newspapers, there will always be a role for books. When you're chilling in a log cabin or on a beach somewhere, you'll probably want a good solid book in your hands. But if you're on a train commuting to work, it may be more desirable to hold a device that will allow you to read any book, newspaper, or blog you want.

Potential Initial Niche Targets

One last thought. If Amazon were to approach the e-book market with Geoffrey Moore's advice in mind (as he writes in Crossing the Chasm), they could target graduate students as an initial niche. With graduate textbooks costing hundreds of dollars, they may find it more cost-effective and easier to lug around a Kindle rather than seven 5lb textbooks. The price point of the Kindle would have to drop from its current $359.00, however. But that is inevitable as they streamline their production costs.

Undergraduate students could be a viable initial niche as well, though more research would need to be done since many undergraduates just purchase used textbooks to save money. If a cheaper Kindle could tap into this market, the purchasers may actually be the students' parents.

Another initial niche could be any profession that requires access to large volumes of books at any given time, such as lawyers. Imagine the mountains of books a lawyer has to go through. Now imagine being able to search through all of that easily through a single handheld device. Not bad, huh?

This is easier said than done, of course. There are lots of tricky book publisher contracts to negotiate. Without the necessary content, these niches are impossible to reach. But still, it's not hard to imagine these users wanting a device like the Amazon Kindle, yea?

Remember your first iPod? Remember the first song you purchased from Apple's (AAPL) iTunes Store? Remember the 100th song?

I got a chance to check out Amazon's (AMZN) Kindle this past weekend. It was almost like seeing an iPod for the first time. I couldn't stop drooling and fawning over all the buttons and controls.

Much has been written about the Kindle already. Some extol its features, like being able to carry lots of books cheaply, having good battery life, and having audiobook integration. Others slam it for it's poor design and lack of social network (Um, really? You want a social network on an e-book reader? If anything, that's a P3 feature and shouldn't be part of a v1 product). It's interesting to note that many of the Kindle's original critics have changed their minds after using it for a while.

Rob Tillotson of The Gadgeteer has a deep & thorough review, Daniel Turner of Technology Review offers a good overview of its technical guts, and Mike Elgan of Macworld lists some great tips & tricks of the Kindle. These include how you can surf the web using its basic web browser (called, appropriately, "Basic Web"), download free e-books, get answers from a free human-powered search engine called Kindle NowNow, make the battery last even longer, read RSS feeds for free, etc.

My reaction? I just went out and purchased some AMZN stock. It's currently floating around the same price it had when the Kindle debuted on Nov. 19, 2007. It closed at 79.18 that day; today, it's been bouncing between 77.43 and 78.85, down from a high of 84.39 last Monday. But I don't care about that. I'm long AMZN. I'm betting that the Kindle will be to Amazon what the iPod was to Apple—and we all know how good the iPod was to Apple!

Here's why I'm long on Amazon:

UPDATED 5/24/2008: I added #9 to this list.

1. I am exactly the kind of early adopter customer Amazon wants. Although I didn't rush out to buy a Kindle (and am not going to anytime soon), as soon as the second or third version is released, I will. They're working on their second version right now, a source in Amazon tells me (and it sounds pretty good!), so it shouldn't be long before v3 is ready and relatively bug-free. And when I purchase a Kindle, I'm going buy lots of e-books. I'm a voracious reader and am always buying new books. Since Amazon's strategy is to profit from e-book sales and not Kindle sales (the Kindle is a loss leader), attracting book-hungry customers like me is going to be so money.

2. I travel often and always carry a book or three with me. That often adds extra weight that, well, just sucks. Since I usually try to travel light, carrying one Kindle versus three books sounds totally awesome. I can see other travelers wanting the same benefits. The business traveler niche could have great potential for Amazon, especially if business users are able to load their business documents onto the Kindle and peruse them during their flights.

3. I'm a bit of a digital pack-rat. Or just a big a geek, I dunno. I once had over 600 CDs. Then, to live more efficiently and have less material belongings, I burned them all into MP3s. I did the same with my DVDs. All that extra shelf space allowed my book collection to grow like crazy. Now imagine if I could digitize all of my books. How cool would that be. All of the media I'd own would be digital, portable, and easily searchable (told you I'm a big geek). That would be cool.

4. This is only a v1 product and already it's gotten a huge positive reaction. Most v1 products suck. The first generation of iPods sucked. But with Apple's branding & slick design and iTunes' ease of use & practical prices, it took over the market and surged as each new version was released. Kindle 1.0 was cool, 2.0 and higher can only get better.

5. A medical student I know took a look at the Kindle and said that if all of his medical textbooks were offered on the Kindle, he'd buy it in a heartbeat. First of all, medical textbooks are huge. HUGE. And medical students have to carry two to four of these heavy things at once. Second, medical textbooks are expensive, especially for starving students. With e-books being cheaper than regular books, a student could easily make up the cost of the Kindle over the course of his/her education. This could be a huge market for them, and the smart folks at Amazon know this.

6. Amazon has to maintain physical warehouses to store all the books they sell. E-books don't require expensive warehouses; they just require a database on a server farm somewhere, which is infinitely cheaper. This means Amazon could potentially sell more products (e-books) while not incurring any additional costs. I like them mathematics.

7. If Amazon can execute its Kindle & e-book strategy well, it certainly could go the way Apple's iPod & iTunes strategy went. According to a Nov. 19, 2007 article from Aaron Pressman of Business Week, "Apple shares (AAPL) stood at $9.51 (adjusted for a split) the day before the launch. I don't need to tell you where they are today. Ok, I will: $166." Not a bad return, I'd say.

8. I'm not the only one who expects great things from Kindle. Citigroup Analyst Mark Mahaney "expects Amazon to generate between $400 million and $750 million in revenue from the Kindle by 2010, or 1% - 3% of Amazon's total revenue," writes Michael Arrington of TechCrunch. "If Amazon executes right with its Kindle product and marketing strategy, the iPod analogy for the Kindle won't be too far stretched," Mahaney is quoted as saying. Cool!

9. Part of iPod's success came from the ease of use of getting more MP3s. Just as the iTunes Store made it very easy to download MP3s, the Kindle Store makes it very easy to download e-books for the Kindle. And even better, the Kindle Store is easier than iTunes because you can directly access it via the Kindle (no need for a computer at all).

I can't wait for the day I can look back and remember my first Kindle, my first e-book, and my 100th e-book. And also, a great big ROI on AMZN!

You know this already. Most people don't read website text very closely. According to usability guru Jakob Nielsen, they just scan the text.

Well, Nielsen's team just provided further proof of this with an eyetracking study. They've also shown that web surfers only read about 20% of the text.

I'd say more, but you probably won't read it.

Now for some Friday fun. You've heard of Search Engine Optimization (SEO), yea? That's when you do things to your website to make it rank higher in a search engine's search results. A whole industry has sprouted around knowing how to do these techniques well and consulting on such techniques.

Coincidentally, I've learned quite a bit of SEO myself too, after having worked at Yahoo! (YHOO), so if you need an SEO consultant, let me know!

All shameless plugging aside, optimizing for Google (GOOG) has become such a science that it just begs for a parody.

A parody, you say? Why, Here's one!

This is the brainchild of the hilarious Gene McKenna of Kango.com. He built this about two weeks ago and it's been tossed around the Web quite a bit since then (so if this is old news to you, my apologies). Props to Gene though, for much hilarity!

Now for some Friday fun. David Friedman of Ironic Sans has had some great product ideas, and some not-necessarily-great, but oh-so-funny ones too.

Of the latter kind, here are my top picks:

• Pre-pixaleted clothes for Reality TV shows

  You know how some people's t-shirts are pixelated on Reality TV shows? Here are some pre-pixelated t-shirts for you!

• The Ant Desk

  Here's a real ant farm that you use as your desk. Really.

• Pac-Man napkin holder with Ghost salt and pepper shakers

  The title pretty much says it all. Simple, yet fun for Pac-Man lovers.

• Commemorative T-shirts for Fictional Events

  How about a t-shirt for the Khan Con '89? Or the 1st Annual Agoraphobics Parade (22nd Annual Attempt)?

• A building shaped like Godzilla

  This would make a great tourist attraction for Tokyo.

• Paintings of descriptions of the paintings

  Imagine a large painting that said "Untitled #6" 2007 David Friedman (b. 1974)…

• Fun with facial recognition

  The Super Bowl Jumbotron could pick two people out of the crowd and show them side-by-side as a "Separated at Birth?" gimmick.

• "12"—a spinoff of "24" for kids

  Kids are half the size of adults. 24 is for adults. Half of that is 12. Get it?

• Lolcatvertisements

  Use cute lolcats in your marketing campaign for lots of great lolcustomer lolacquisition!

• The Alien Stapler

  H. R. Giger's aliens are perfect for busting through skulls, bleeding acid, kicking ass… oh, and stapling documents.

• Breed a "Mickey" Mouse

  This one's kinda freaky, but it's basically a "real" Mickey Mouse, sans the pants (though you could certainly add some pants).

• Celebrity middle finger coat hooks

  Ever have the desire to hang your coat on Johnny Cash's (or George W. Bush's) middle finger?

Is this guy a genius or what?

I still remember where I was six years ago today. Eating dim sum when my Dad called from New York to tell me what just happened.

After the World Trade Center fell, then-Mayor Rudy Giuliani promised, "We will rebuild: We're going to come out of this stronger than before, politically stronger, economically stronger. The skyline will be made whole again." Then President George W. Bush declared, "As a symbol of America's resolve, my administration will work with Congress, and these two leaders[, Giuliani and then-Governor George Pataki], to show the world that we will rebuild New York City."

Even WTC leaseholder Larry Silverstein spoke up and added, "It would be the tragedy of tragedies not to rebuild this part of New York. It would give the terrorists the victory they seek."

Now six years later, what's been done?

First, the Lower Manhattan Development Corporation was established by Pataki and Giuliani to distribute about $10 billion in federal funds aimed at rebuilding downtown Manhattan. Only this met with a lot of resistance and controversy.

Since the LMDC doesn't actually own the World Trade Center site, differences of opinion with its owners—the Port Authority of NY & NJ and Silverstein Properties—led to delays. The LMDC was also criticized for not allowing the victims' family members to participate in the voting of memorial proposals. After months and months of design proposals from all kinds of prominent architects (including the Donald-Trump-backed Twin Towers II), no single design pleased everyone.

Finally, the LMDC sponsored the World Trade Center Site Memorial Competition and Michael Arad's and Peter Walker's "Reflecting Absence" design won. Having completed its mission, the LMDC then dissolved.

The new architectural plans call for:

• Five new skyscrapers (1 WTC, Freedom Tower; Towers 2, 3, 4, and 5)
• National September 11 Memorial & Museum at the World Trade Center
• World Trade Center Transportation Hub
• Retail Complex
• Performing Arts Center

The latest news now is a finalized design being developed by Silverstein Properties and the PANYNJ. Construction is slated to begin next year.

That'll be seven years later.

Which, in all honesty, is still pretty quick. Lots of people are complaining about how long it's taken—and yes, it HAS taken a long time—but with a subject as controversial and passionate as the reconstruction of the World Trade Center, coupled with good old fashioned politics and trying to please the masses, of course it's going to take a long time.

Anyone who's ever built web software knows how big projects with a lot of stakeholders can last forever. Every chef knows that when there are too many cooks in the kitchen, consensus is rare. In the WTC's case, the stakeholders and cooks are governors, mayors, real estate developers, architects, the public, and other prominent people with big egos.

No wonder it's taken seven years to begin. Now I wonder how long the construction is going to take.

It's generally believed that using your own products is a good thing. You're eating your own dog food, so to speak.

Dave Shen, a former Yahoo! (YHOO) employee, suggests otherwise. He writes:

I would put forth that the blindness that happens with being comfortable and focusing on yourself and your own company is precisely the way you get blindsided by some fast moving kids out of college developing something that is so cool and compelling and you see them gaining traction only after you've fallen behind.

What's the best way to combat this?

USE THE BEST PRODUCT OUT THERE FOR WHATEVER IT IS YOU DO. (Emphasis his)

That's pretty sound advice. Using the best product for your needs, even if it's not your own, is a great way to understand why it, and not yours, is the best product out there. And if you feel bad about not eating your own dog food, you can think of it as "competitive research."