Wednesday, November 16, 2011

E-Reader Sales Grow Connected Devices Opportunity

connected device forecast
A new report by analyst firm Juniper Research forecasts that e-reader shipments will reach 67 million by 2016, nearly triple the 25 million devices the company expects to reach the market in 2011.

While this is less than half the 55.2 million tablets that will be shipped this year, the price of the market-leading Kindle has fallen significantly (from $349 to $79) since it was launched, and electronic ink technology will ensure that the device continues to carve out a niche for itself in the wireless device ecosystem. eReader Shipments to Reach 67 million by 2016

Separately, Machina Research predicts wireless wide-area connected tablets and e-readers will grow from 66 million in 2011 to 230 million in 2020. Mobile service providers gain two ways from e-reader usage. There is the business-to-business revenue contributed by the e-reader partners, who use mobile networks to deliver content to the readers. 

There also is end user revenue supplied by connected devices. If half of the 2020 devices are e-readers, and just 15 percent of e-readers actually are mobile broadband connected, that is 17.25 million incremental broadband accounts in service. If, by 2020, half of the e-readers are capable of network connections, and are used as part of "family"-style mobile data plans that represent incremental revenue, then as many as 57.5 million new broadband accounts could be in service. 

Such trends are directly important for mobile service providers as many of those devices are equipped to work on mobile networks, and therefore represent a new class of devices that can be converted into new and incremental mobile broadband accounts. Greater use of Wi-Fi-only devices has relevance for fixed-network broadband providers to the extent that use of such devices increases the value of a fixed broadband connection.

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