Thursday night in New York I participated in a debate with Frank Foer and Scott Turow over Amazon's role in the evolving book marketplace (see an earlier round of me versus Foer). My side lost the debate largely, I think, because we ended up spending an awful lot of time discussing hypothetical scenarios in which Amazon drives brick-and-mortar retailers entirely out of business even while maintaining a dominant share in the ebook market.
This simply strikes me as an exceptionally unlikely scenario. As Jay Yarow recently wrote, Amazon actually has a huge problem in the ebook market — people find books through platforms that Apple and Google control.
Look what giant sidebar pops up if I look for Foer's book How Soccer Explains The World in the search bar of my Chrome browser
Look what happens if I look for in the search bar of my Safari browser:
That's Apple delivering a very heavy push to buy the book in their iBook store. Google is using a lighter — but still meaningful — push to buy the book in the Google Play store. And Amazon is inherently vulnerable to this tactic.
I assume that's why Jeff Bezos was so eager to the develop a Fire Phone product. Amazon's original ebook dominance was built on a hardware device, the Kindle, that Amazon controls. But as mobile phones have gotten bigger and tablets have gotten cheaper, Android and iOS products are increasingly viable as reading devices. Kindle books work great on those platforms — I love the Kindle app on my iPad — but Amazon has no control over the platform and is at constant risk of getting squeezed out. But the Fire phone was a huge flop. This all means Amazon's actual position in the marketplace is much more tenuous than most people realize.