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Will 2010 Be an Explosive Chapter for E-Readers?

While 2009 is clearly a watershed year for e-readers with several product launches, the big wave of popularity for the fledgling market will be Q4 of 2010, according to a recent study.

The nascent e-reader market this year saw new devices from Amazon, with the DX and International versions of the Kindle 2, as well as from Sony, with the high-end 3G Daily Reader, along with Barnes & Noble's Nook. But wait, there's more: Spring Design, iRex Technologies, Plastic Logic and Asus have also unveiled details about e-readers coming to market.

With so many devices coming out with varying feature sets, digital book format support and price points, consumers will have more choice than ever and that should result in more e-reader sales this holiday season.

Still, 2010 is the year that the portable digital reading devices will finally see the beginning of mainstream adoption, "culminating in e-reader mania for the 2010 holiday season," according to Allen Weiner, research vice president at Gartner.

"With the entry of new players, such as Barnes and Noble, into the e-reader market and an increase in models from Amazon and Sony, consumers began to have choices in single-purpose e-reading devices in 2009," Weiner said in a statement. "Among the product differentiation points are support for E Ink's electronic paper technology, support for further book formats, and the ability of some devices to allow consumers to purchase content wirelessly and to synchronize content across devices."

While dedicated wireless e-readers grab most of the headlines, Weiner said that digital book apps for smartphones, especially the iPhone, are also poised to play a critical role in the digital publishing sector, though that market is still in its infancy.

"It is too early in the evolution of the e-reading market to know whether smartphones will become powerful stand-alone devices for reading books or whether they will complement other devices, such as fixed readers, said Weiner.

"Book applications for smartphones have the potential to become a bridge to other devices such as tablet readers and netbooks. Apple, for example, could migrate the more than 500 book applications in the iTunes store to a tablet device and Google, which recently announced a browser-based e-reader, could offer applications for Android-based devices of various form factors."

Challenges e-readers must overcome to succeed

Still, the nascent e-reader market must overcome a few obstacles before it truly reaches mass adoption. The devices themselves need to be sold in more retail channels, from big-box stores to lifestyle boutiques, said Weiner.

Currently, most e-readers are available online, in bookstores or at electronics stores.

On the publishing side, more best-seller authors need to be lured to the digital format, said Weiner. "For example, there has been news about the success of Dan Brown's e-book sales of 'The Lost Symbol,' however other noted authors such as John Grisham and J.K. Rowling do not have their works available as e-books," he said.

Weiner's latest research echoes that of other prominent analysts in the sector, which noted that price is a big factor in the future success of e-readers. Right now, $199 is the lowest cost for full-featured e-reading devices, but he predicts they'll need to drop to $99 to gain traction in the marketplace.

Still, he sees only growth for the market and advises publishers to shore up digital distribution of their content to get a piece of the action.

"It's the perfect time for a trial and to establish relationships with others in the value-chain -- that is service providers and digital warehouses -- that can be positioned to assist in a rapid deployment if the market takes off earlier than anticipated," he said.