Prices have rapidly decreased due to the rising popularity of tablets, which are now similarly priced to e-readers
Los Angeles, CA (PRWEB) May 08, 2014
Buyers of e-reader devices have a buyer power of 3.8 out of 5, indicating positive negotiating conditions for buyers. Recent technology trends have helped to create this largely favorable buying environment. “Technological improvements has increased the number of viable substitutes, such as tablet computers, due to functionality and price, increasing buyer negotiating power,” says IBISWorld procurement analyst Jesse Chiang. However, buyer power is limited somewhat due to several factors, including high market share concentration and low average supplier profitability.
Due to rapid technological advances, tablet computers can be manufactured and sold at prices that are directly comparable to e-readers. As a result, buyers have increasingly substituted e-readers with tablets because tablets offer numerous other features in addition to the ability to read digital content at the same price, decreasing demand for e-readers. “Consequently, suppliers of e-readers have had to drastically reduce prices to remain competitive with tablets,” says Chiang. The growing adoption of tablets is expected to continue through 2016, driving the price of e-readers downward and benefiting buyers.
Market profitability has limited suppliers' ability to offer discounts; buyers must instead seek discounts based upon volume or breadth of service. Further limiting buyer power, high market share concentration limits buyers to a small number of primary e-reader distributors. High market share concentration is exacerbated by the medium level of product specialization; while manufacturing an e-reader device does not require particular expertise, negotiating the rights to written content with publishers does require significant market experience, limiting the number of primary distributors in the market. Major vendors include Amazon.com, Barnes & Noble Inc., Rakuten Inc. and Sony Corporation.
For more information, visit IBISWorld’s E-Reader Devices procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of e-readers. E-readers or e-book readers are portable electronic devices used to read digital content such as digital magazines and e-books. Typically, e-readers have limited features but can come in black and white or color. They can also come with touch screen functionality. Primary distributors, wholesalers and retailers distribute e-readers. This report does not include tablet computers and smartphones.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
Buying Lead Time
Key RFP Elements
Buyer Power Factors
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