Monday, August 02, 2010

Amazon's Kindle and the numbers game

Amazon has never revealed actual Kindle or eBook sales numbers, either in dollars or units. They've always stated the numbers in terms of a percentage of something else for which there are no actual numbers: Sales compared to a previous quarter or year, sales compared to hardcover books, etc.

There's a movement to try to pressure Amazon to release the actual numbers. However, there's no legal obligation on the company's part to release them, and Jeff Bezos has said that he won't do so for competitive reasons. When I was an industry analyst, I tried to get companies such as Motorola and Cisco to release installed base and/or shipment numbers for products sold into the IPTV (Intermet Protocol Television) market, and they always refused, even though they were clients of the company I was working for.

Companies have a right to withhold their sales figures for competitive reasons, but I've found that the real reason usually is that they'd be embarrassed if the numbers were released. For example, I was unable to get Microsoft to release sales numbers for its Mediaroom IPTV platform, on the basis that they didn't have permission from their customers. Apparently, not a single customer anywhere in the world was willing to release its numbers. Then, miraculously, shortly before I left, Microsoft began releasing detailed numbers. Why? Did all their customers suddenly mutually agree to start talking? In my opinion, the real reason was that Microsoft was afraid that investors would learn that they were spending an enormous amount of money on a business that was getting very little traction. Once their installed base reached a respectable level, they were happy to talk numbers.

I'm not going to state that the reason that Amazon refuses to release actual Kindle numbers is that they're disappointing when looked at objectively, since I have no evidence one way or another. However, companies with hot-selling products usually are glad to crow about their numbers. I leave the conclusion to you.
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