CARLSBAD, Calif.--Amazon.com founder and CEO Jeff Bezos kicked off the morning proceedings here at D6 after a night of polite carousing by industry luminaries. During the interview with D co-host Walt Mossberg, Bezos announced a streaming-video service and explained his foray into hardware with the Kindle e-book reader.
On the subject of video and music delivery, Bezos said, "We are working on a new version of video-on-demand, a for-pay streaming service we will release in the next couple of weeks. The streaming service will start instantly, and it's a la carte, for pay."
Regarding competing with Apple's iTunes services, Bezos said it is clearly in the self-interest of music companies to have competitors.
The Kindle is clearly a passion for Bezos. It follows on his love for selling books online, which was the origin of Amazon, and developing a new market for digital content delivered over wireless networks.
"We base our strategy on customer needs instead of what our skills are...Customers will eventually need things that you don't have skills for, so (you) need to renew yourself with new skills," Bezos said. If Amazon doesn't extend into new product categories, the company will get outmoded, he said.
Bezos wouldn't disclose Kindle sales. "On a title-by-title basis, with 125,000 titles for Kindle, and you look at Amazon's physical sale of the same books, Kindle sales are more than 6 percent of the universe of 125,000 titles," he said. Amazon reduced the price of the $399 Kindle by 10 percent this week.
While Bezos said he was happy with the sales of the Kindle, the price cut and the heavy promotion of the device on Amazon's site could mean sales aren't spectacular. The Kindle could be a meaningful financial component in Amazon's business, Bezos said, but he didn't put a figure on the Kindle's contribution to annual revenue.
Regarding the fate of physical books, Bezos said the vast majority of books will be read electronically. Just as horses haven't gone away, books will be around, he quipped. "We see Kindle as an effort to improve the book, even though it hasn't changed in 500 years," he added.
"You can't ever outbook the book, so you have to do things that you can't do with a book, such as in-stream dictionary lookup, changing fonts, and wireless delivery of content in 60 seconds," Bezos said. "We have to build something better than a physical book."
Bezos said he did research into the smell of the book--glue, ink, and mildew. "We can never capture that," he said, adding that the container is not important; the narrative is. He wants to make long-form reading more frictionless so that people read more.
Mossberg asked Bezos about adding new features to the Kindle and its utility as a Web browser.
"There are things that fit into the Kindle form factor and don't interfere with the purpose of the device. But the device is not a cell phone or bunch of things. It should be able to browse the Web," he said. "If you were trying to build the perfect Web-browsing device, you wouldn't use electronic ink. It's not the right display technology for high-quality Web browsing."
"You might say the Web is the most important book in the world," he added, but that's not something the Kindle is designed to read as well as other devices.
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