Remorseless rejection of single-task devices threatens e-readers

What's been on your gift wish list this holiday season—an e-book reader, tablet, or cell phone, or perhaps one of each? What key functionality are you looking for, and which of these devices can best deliver it?

If rather than a prospective recipient of such devices you work for a designer or manufacturer of them, the key question is whether there will be continue to be a promising, lucrative future for all three categories. Recent market research suggests not.

The first step in designing or choosing to buy such a device would seemingly center on the functionality the device offers. And in fact, a user may simply want the device to serve as a fashion statement. My favorite parody of such “functionality” comes in the form of post in the Onion from a few years ago, titled “New Device Desirable, Old Device Undesirable.” The parody quotes the ostensible maker of the new device as saying, “The new device is an improvement over the old device, making it more attractive for purchase by all Americans. The old device is no longer sufficient. Consumers should no longer have any use or longing for the old device.”

The Onion provides the consumer's view, too, quoting the fictional Rebecca Hodge, “…whose executive job allowed her to line up for several hours in the middle of the day in order to obtain the previously unavailable item”: “Not only will I be able to perform tasks faster than before, but my new device will also inform those around me that I am a successful individual who is up on the latest trends. Its attractiveness and considerable value are, by extension, my attractiveness and considerable value.'”

Of course, what makes parody interesting is its potential plausibility, and technology as fashion statement (the Onion's new device is available in blue) may indeed be the next big thing. Krisztián Flautner, vice president of research and development at ARM, has suggested that the current emphasis on devices will give way to computerized fashion accessories like watches, necklaces, and rings. “I would like to see the next computer revolution be something that looks good,” he said during a keynote address November 6 at the International Test Conference in Anaheim, CA.

I'll comment more on Flautner's predictions in my January print editorial, which you will be able to find online toward the end of December. But meanwhile, such high-tech fashion items aren't readily available this holiday season. (I am aware of products such as the Personal Soundtrack Shirt, which could assure that an appropriate “Royal Entrance” fanfare announces my next appearance at a meeting, but I think I'll pass for now.) So that brings us back to tablet vs. phone vs. reader.

My preference has long been to carry as few devices and chargers and cables as possible. I've learned that for my work a tablet simply cannot replace the laptop, so I'm stuck with the laptop. For reading, I have the Barns & Noble Nook and Amazon Kindle apps on my Android phone, which so far works for me but may not continue to do so as my eyes get older. If you seldom need to write 2,500-word articles on the road while referring to notes and images spread across several different document and graphics files, a tablet may adequately address your mobile computing needs.

And I know people who love their e-book readers—especially for their long battery life and readability in bright daylight.

So I would welcome the proliferation of various classes of devices, so consumers can choose the one device or combination of devices that best suits their needs.

However, one class of device may trounce another, according to IHS iSuppli. The market-research firm notes that from 2008 to 2010, shipments of e-readers (virtually unknown to consumers in 2006) grew from 1.0 million to 10.1 million, peaking in 2011 with 23.2 million units. However, the firm notes, the e-book reader market has been sent reeling by more nimble tablets. The firm predicts that shipments of e-book readers by year-end will fall to 14.9 million units, with another 27% contraction occurring over the next year. By 2016, the firm says, the e-book reader market will have lost two-thirds of its peak numbers.

That will still represent 7.1 million units, so if the e-reader is your platform of choice, you should be able to find one available for some time to come. But the e-reader contraction is remarkable.

“The rapid growth—followed by the immediate collapse—of the e-book reader market is virtually unheard of, even in the volatile consumer electronics space, where products have notoriously short life cycles,” said Jordan Selburn, senior principal analyst for consumer platforms at IHS, in a press release. “The stunning rise and then blazing flameout of e-books perfectly encapsulate what has become an axiomatic truth in the industry: Single-task devices like the e-book reader are being replaced without remorse in the lives of consumers by their multifunction equivalents, in this case by media tablets. And while other uni-tasking devices—like digital still cameras, GPS systems, and MP3 players—also face similar pressures and battle dim prospects ahead, all have had a longer time in the sun than ebook readers, demonstrating even more painfully the depth of the ebook reader’s fall.”

IHS notes that e-book readers remain popular in Eastern Europe and Russia and may find opportunities in Africa and India, where e-book readers' power efficiency may make them attractive choices. Also, the devices may regain popularity if their selling prices fall below manufacturing costs.

What's bad news for e-book readers is good news for tablets, IHS said. The firm noted that the market for tablet displays is expected to double from 2011 to 2014, reaching almost $10 billion. In addition, semiconductor shipments for tablets will show growth, with total semiconductor consumption by tablets topping $20 billion by 2016—more than doubling the amount in 2011.

I'm what Selburn at IHS might call a remorseless rejecter of single-task devices, but it's still sad to witness the decline of the e-reader market. Perhaps the devices' pricing and performance will fall into line with the needs of the dedicated bookworm who is more interested in reading than in, as the Onion puts it, avoiding giving the impression that he or she is “…the sort of individual who does not own the new device.”