Will Kindle Move Beyond Books, Periodicals?

A story in the NY Times from Friday asks the question: Will Amazon Open the Kindle to Developers? The story concludes that the answer is "probably not":

An Amazon spokesman, Drew Herdener, wouldn’t comment on this. But according to a few analysts and Amazon watchers who are often prescient on these things, it seems the answer is probably not.

The piece discusses the limitations of the device (i.e., black and white screen, connectivity issues) as technical barriers to iPhone like functionality and capabilities. Yet, to succeed long term, opening up and building an ecosystem like what the iPhone has done is precisely what Kindle must do. As beloved as it is it's a non-mainstream device and its cost ($299 for Kindle 2 and almost $500 for the DX) is a barrier for most people. Indeed, Sony and others have already undercut the Kindle with their pricing (there are devices coming as cheap as $99, though $199 is the "sweet spot"). And you can bet that price competition will only get more intense as a kind of land grab sets in. 

Apple's forthcoming tablet will likely be compatible with iTunes and iPhone apps and provide most of the eReader functionality that Kindle has. It will be expensive, relatively speaking, but Apple's brand strength can support a higher priced media tablet, provided the functionality is there. Amazon is thus likely to confront a host of competitors with color screens and broader capabilities on the one side and cheaper models on the other. 

While it has many devoted fans, it is NOT the iPhone of eBook readers (at this point). And it will not be similarly insulated from competition. Rather it will be seen as a pioneer that opened the door for many others, who eventually "ate its lunch." That is, unless Kindle 3 becomes much more than a simple eBook reader.

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Related: Here's a nice tablet roundup at CrunchGear.