Barnes & Noble Nook jabs Amazon Kindle 2 where it counts: price

This is the pleasant side of a free market economy where there are multiple healthy competitors. Barnes & Noble just debuted its new Nook e-book reader with a price tag of $259 and that seems to have ignited a reaction from Amazon who has consolidated its Kindle 2 lineup to eliminate the “international” version.

Instead, there is only one Kindle 2 now that is compatible with GSM networks. Incidentally that may mean Sprint losing some wireless network business on future versions of the Kindle which for now will be using AT&T’s network, the same as the Nook. Current Kindles will still function on Sprint’s network, but what is Amazon aiming to accomplish with this move?

Somehow it has to address the Nook’s value proposition which includes a touch screen powered by Google Android. Marketing multiple versions of the Kindle 2, one more expensive for an international audience dilutes the brand and creates an unnecessary decision point for consumers. It was also off-putting to countries outside the United States who were left wondering why their version was more expensive.

Underlying all of the marketing hype and power plays going on between Amazon, Sony and Barnes & Noble is the technology that started it all, E Ink. That’s the compelling piece of all eBook readers on the market right now because it’s just like reading paper.

The challenge with making eBook readers multifunctional is also tied to the way E Ink works. It has a slow refresh rate and displaying colors requires a more expensive screen, which could stifle consumer interest in a still-fledgling industry of electronic books. E Ink Corporation announced a color version of its technology back in 2005 so technically it’s possible, just a matter of creating the economics of scale and production efficiencies.

The awesome part of this landscape is lower prices and more functionality for consumers, all while reducing the amount of paper we’re using in the economic ecosystem.