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Start a fire with some kindling

Yesterday was a big day for Amazon.com. They announced a whole new lineup of e-readers and tablets for their Kindle line of products. Many a pundit said that they were going after Apple in their latest play, and to some degree I think there's some small truth to that, but I don't think that's the whole story.

In fact, I think the first person that Amazon is trying to take down is Barnes & Noble. B&N's Nook tablet has been their answer to the Kindle for a few years now, and from a technology and feature standpoint, the two have been leap-frogging each other. Before the Kindle announcements yesterday there was the Nook with glow-light, so you can read in the dark. The ad for this device played constantly on TV in recent months, and I'm sure it caught the eye of more than a few customers. Yesterday Amazon answered with a version of it's own, that also upped the ante by including a capacitive touch screen, a step up from the Nook version.

On the high end, B&N has struggled to define what it's Nook Color really is. Once you put a color screen on an e-reader, it opens up a whole new set of content, but you need an ecosystem to support that content. B&N has always been a top notch bookstore, and is pretty much the only big-box bookstore left around. But their music business is a hold-over from the pre-digital age, and they've never been big in the DVD world. So that leaves books. As an e-reader, B&N's offering is really top notch, and I'm personally a big fan of their product. But, it's obvious that first up on Amazon's list of goals, it taking down this competitor once and for all.

At the heart of it all is the issue of ecosystem. Amazon, over the past couple of decades, has built a tremendous ecosystem of products that mesh well into a digital lifestyle. They were one of the first to the online book business, they embraced the digital music revolution (albeit a bit later than others), and because of their wide range of products most people think of them first when looking for everything from DVD's to diapers. This ecosystem is what Amazon is hoping will draw you away from being simple a book reader, which you can do on a B&N Nook quite easily, to being an Amazon.com 'digital consumer'. They're hoping that once you realize that you can do more than read books on a Kindle that you'll choose their ecosystem over the competitors. For many people, that may be a very compelling argument.

Sadly, the range of offerings that Amazon put out yesterday may be the beginning of the end for Nook. Or maybe it's an opportunity for B&N to realize that they can't compete in the ecosystem game, and focus on letting the Nook be the best e-reader it can be. Perhaps it's OK for B&N to look at a smaller portion of marketshare and be content with that, if they can be the best at what they do. Only time will tell if consumers would go along with that notion however, and for the time being it looks like the next move on the chess board is Barnes & Noble's.

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