Amazon is to sell an improved Kindle electronic reader and will cut the price, in a move to address the threat from Apple's iPad tablet computer.
Amazon's new Kindle DX will sell for $379, down from $489, and have free 3G wireless connection with no monthly bills or annual contracts, the company said.
It was the second price cut for Amazon in as many weeks. Responding to the threat from the iPad, Amazon cut the Kindle with a 6-inch screen to $189.
At stake is market share for e-books, the fastest-growing segment in a moribund bookselling industry. In addition to the iPad, the Nook and Kindle also compete with Sony's Reader device. Industry experts and rivals say the field will get even busier, with more e-readers expected this year.
Apple's iPad, launched in April at a starting price of $499, can function as an e-reader, but unlike competing models, it has a color screen and can be used as a full computer. It sold more than 2 million units in its first 60 days and its own e-bookstore has quickly won market share, putting pressure on rival readers like Kindle and Barnes &a Noble's Nook.
Still, some analysts say dedicated e-readers such as Nook and Kindle are appealing because they consume less power, are easier to read on, and weigh less.
Shares of Amazon.com closed yesterday at $109.26. The stock is down about 18 per cent so far this year, less than the 32 per cent decline in Barnes & Noble shares so far this year.
Reuters