New eBook Reader Undercuts Kindle, Sony Reader Prices
Amazon's Kindle electronic book reader costs $359—but you can't get one until at least February. Sony's PRS-700BC costs $399—also pretty darn costly. But Foxit Software will soon begin shipping an eBook reader that costs only slightly more than half what Sony's reader does.
Context & Ripple Effects
In late 2008 the e-reader market was a two-horse race priced for early adopters: Amazon's Kindle at $359 — backordered until February — and Sony's PRS-700BC at $399. Foxit Software's entry at barely half of Sony's price is the first real crack in that pricing umbrella, arriving years before the race to the bottom this coverage later documents. The arc that follows is striking: within roughly two years, Freescale was projecting sub-$150 readers on cheaper silicon and Borders was retailing the $150 Kobo, while Amazon itself pushed the Kindle down to $114 with ads — and by its own admission sold hardware below cost.
First-order effects
- Foxit hands budget-conscious buyers a credible sub-$200 alternative just as both incumbents are supply-constrained or premium-priced — Amazon's Kindle is unavailable until February, so holiday demand has nowhere else to go but down-market.
- Sony's $399 PRS-700BC instantly becomes the price outlier in a three-product field, forcing it to justify a premium on features rather than availability.
Second-order effects
- Incumbents must respond on price rather than wait: the pattern Foxit starts anticipates the sub-$150 wave (Freescale's cheaper e-paper chips, the Kobo at Borders) and Amazon's own ad-subsidized $114 Kindle, signaling that hardware margins were always thinner than list prices implied.
- Retailers gain leverage as reader prices fall toward impulse-buy territory, turning e-readers from specialty gadgets into mass-channel products — exactly the shelf space Borders later gave the Kobo.
Third-order effects
- If the price-collapse pattern holds, the durable money in e-reading shifts from device margins to content ecosystems and storefront lock-in — the structural logic behind Amazon later selling Kindles below manufacturing cost.
- Hardware differentiation commoditizes; vendors without a content store (as Foxit arguably was) get squeezed out or repositioned upmarket, a trajectory visible in Sony's eventual retreat to niche large-format E Ink devices.
The trend: This is an early data point in the e-reader's transformation from a $350-plus early-adopter device into a near-commodity whose economics are set by content ecosystems rather than hardware margins.