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A JP Morgan survey finds that 40% of iPad owners also own a Kindle
I stand before you a humbled reporter. No sooner did I announce my prediction about the iPad killing the Kindle in 2011 than J.P. Morgan announced that it won’t. In a survey of some 1,000 Internet users, J.P. Morgan found that 40% of iPad owners also own a Kindle and another 23% intend to buy one in the next 12 months. So in other words, two-thirds of iPad owners either have or want a Kindle in addition to their iPads.
Analyst Imran Khan believes that the difference in price has created a wide enough gulf between the two devices as to put them in completely different categories. The lowest priced iPad stands at $399 while the lowest priced Kindle is a much lower $139, thereby appealing to different demographics. Thus, it stands to reason that if the iPad came down enough in price, the average consumer would be inclined to own both the iPad and the Kindle, rather than choosing one over the other.
As many VatorNews readers have pointed out, the Kindle’s e-ink technology is really the driving force that prompts heavy readers to adopt the e-reader over (or in addition to) the iPad, as the Kindle allows for long-term engagement without eye-strain. The J.P. Morgan survey reveals that while a full 49% read 0-10 books a year (0?), 23% read more than 20 books a year (of that group, 10% report reading more than 30 books a year).
It’s also worth noting that the e-book market has seen explosive growth in the last two years—leaping from 1% of total book revenue in 2008 to 9% in 2010. Amazon has also channeled more energy into advertising. The survey shows that 76% of respondents have heard of the Kindle, compared to 45% who have heard of the Nook (Barnes & Noble’s e-reader) and 84% who have heard of the iPad. Even more telling was the percentage of users who either own a Kindle or plan to buy one within the next 12 months—a full 28% in December 2010 compared to an anemic 7% in July 2009.
Amazon has been boasting big sales of its latest Kindle in recent months, and while it shies away from releasing actual numbers, sources with knowledge of the data say that Amazon sold eight million Kindles in 2010. Amazon also recently announced that the latest Kindle has become the company's highest selling item of all time.
What the survey doesn’t seem to address is how satisfied users are with each device. A recent survey conducted by Changewave found that 75% of respondents report being very satisfied with their iPad, compared to 54% of Kindle owners. By contrast, more Kindle owners than iPad owners report being somewhat satisfied, somewhat unsatisfied, and very unsatisfied with their device, which leads one to conclude that if the average consumer ends up owning both in the near future, word is going to get out that the iPad is a better investment than the Kindle (assuming respondents are satisfied/unsatisfied with their devices for the same reasons).
Given rising Kindle popularity as well as other inroads Amazon is making in other categories like apparel and e-books, Khan rates Amazon among his top Internet stock picks for 2011.
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