Originally written for eBookGuru - The Digital Magazine Devoted to eBooks

I just came this article in Wired magazine, speculating about whether a $50 Kindle could beat the iPad.

The idea of a $50 Kindle postulated in the article is very appealing. It was less then a year ago when I wrote about getting the price of an eReader below $200. The Kindle is still above this mark at $259 but the Kobo eReader (great user review here) is well below at $149 - $110 less than the Kindle. Heck, you can almost get two for the same price.

However there are a couple of items that I take exception to.

First, the idea that the Kindle and the iPad are in competition. The iPad is more akin to a laptop or a net-book whereas the Kindle and other eBook readers are just that - eBook readers. Admittedly some of the new readers coming to market are trying to be all things to all people and those are the readers that are more likely to fail. Not just because they will be competing against the iPad with its ease of use and cool factor, but because they will also be competing with all the iPad competitors.

The competitors, like the Dell Streak, will be lower in price, making them the more likely competition for higher end eReaders. It also seems likely - pending what happens to Palm’s Web OS post HP acquisition of course - that most of the iPad competitors will be running Android rather than Windows. Since both the Kindle and the Kobo have apps for Android, it is possible that Android based tablets could cannibalize sales of those eReaders.

So one way to dominate the eReader market is to make the least expensive eReader out there, an approach that Kobo seems to understand. The other way is to make it as easy as possible to read books using the same platform. Both Kobo and the Kindle have this down pat, with both eReaders having apps for the iPhone, Android phones, the Blackberry, and the iPad, as well as software for PC’s and Mac’s.

Apart from price, Kobo also has an advantage in it uses the open ePub eBook format, making situations like the author of the Wired article experienced unlikely. When Mr. Sorrel’s Kindle broke, he complains that

This effectively means I have lost all the books I bought, too.

As pointed out in the comments to the article, this isn’t true as he still has all those other options for reading his Kindle books. Unfortunately he is limited to replacing his Kindle with another Kindle if he wants to be able to read his books on an eReader rather than a phone or a computer. The ePub format is supported by the Kobo, the Sony Reader, and the Barnes & Noble Nook. If Mr. Sorrel had been using one of those devices he would have more options available.

As for the cellphone as an eReader replacement, this works for casual use. However most people will prefer a larger format that is easier to read in more conditions and has a longer battery life. Also accessories like the M-Edge Guardian Case for Amazon Kindle extend the usability of eReaders to places like the bathtub or the beach.

In short there is still a strong market and business case for a low-priced dedicated eReader. The more bells and whistles vendors try to add, the more they are competing with the tablet market and the more likely they are to lose.