Amazon Kindle to lose 55% marketshare to Apple iPad and Google tablet?

Amazon cannot hold onto the e-book market with the entry of Apple with the ultra-hyped iPad and the specter of a Google tablet, according to Credit Suisse analyst Spencer Wang. Wang’s research paper shows the three companies will each split the e-book market, dropping Amazon’s marketshare from 90% to 35%. Ouch.

Near term, we suspect that the iPad and the new eBook agency pricing model, which requires that Amazon increase retail prices to be more consistent with Apple’s pricing, will provide Kindle with the most market share headwind. Going forward, we can envision a scenario where Apple, Amazon, and Google eventually split the market. Therefore, we expect Amazon’s share of eBooks business to fall from 90% currently to about 35% over the next five years.

The iPad is coming, the iPad is coming!

But is the iPad really that much of a threat? According to Steve Jobs, the iPad won’t even ship with the a e-reader application on the device. Users will have to sift through the 150,000 apps to find a suitable e-reader and download the app themselves. The positioning of the e-reader falls in line with what Jobs said back in 2008:

“It doesn’t matter how good or bad the product is, the fact is that people don’t read anymore,” he said. “Forty percent of the people in the U.S. read one book or less last year. The whole conception is flawed at the top because people don’t read anymore.”

GTablet

Fearing Google in the market might make even less sense. A concept image was floated around the net but we’ve not anything concrete about a tablet or e-reading device has been even suggested by Google. The company is selling it’s first phone after years of Android development. Google’s interest has always been opening up data, especially when it comes to books. An e-reader for them is any device that connects to the net. If Google has a tablet, it won’t be optimized for e-reading.

Kindle is King

In talking about e-readers for a few years, there is one thing I’ve learned: readers are ferociously loyal to their Kindle. E-ink, low battery drain and a wide selection of high demand content should keep Kindle-rs locked in. If Kindle owners pick up an iPad, I suspect it will be for everything but e-reading.

In summary, I have a hard time agreeing with this analyst. To be far, Wang expects this 3-way split will happen eventually. Even long term, the idea of e-books catching on the iPad seems hopeful and to throw Google into the mix at this point seems more than hopeful – it’s fanciful.

Read: [Wall Street Journal]