Amazon and Microsoft Strike Deal

Within the past few days, Amazon and Microsoft announced that they have signed a patent cross-license agreement which gives each company access to some of the other's intellectual property portfolio. The financial details of the deal have not been released, but it is expected that Amazon paid Microsoft a certain amount to avoid potential litigation involving a software program that might infringe on Microsoft's intellectual property. Although this deal covers a broad range of technology, one major piece of technology that Microsoft will have access to is Amazon's popular e-book device, Kindle.

This comes at a time when Amazon has recently announced an expansion of the Kindle product. Author's and publishers from around the world now have the ability to upload books in Spanish, Portuguese, and Italian. This move doubled the number of languages that were available on Kindle. Before the expansion, publishers could only make available books in English, German, and French.

Amazon!

After many sleepless nights wondering what company I was going to blog about this semester, I have decided to focus on Amazon. I picked Amazon because I think they are an interesting company who was ahead of their time in taking advantage of the internet as a marketplace. They started off as simply an online bookstore, but now are the world's largest online retailer. Another reason I picked Amazon is due to the amount of information I will likely be able to find on them over the course of the semester.

While looking over information about the company today, I stumbled across an article that talked about the e-book market that Amazon is involved with. The theme of the article was basically that Amazon is currently dominating the e-book market, but that their dominance might be short lived. Currently they hold about a 90% market share, but the entrance of other players into the market will likely lower their share to around 72% by year's end. The immediate competitor that Amazon is facing is Apple. Apple is releasing their e-book friendly device in the form of the iPad this spring, which should deal a huge blow to Amazon's dominance. It has also been rumored that Google is going to be releasing a similar tablet in the near future. Due to the emergence of these two players into the market, analysts believe that within five years Amazon's marketshare could fall to 35%. Although this is a huge decline in marketshare, Amazon's e-book sales are expected to increase from $248 million to $775 million over the same time period as e-books become more popular.