Amazon.com expected to unveil Kindle 2 February 9

But questions linger about whether a US$359 e-reader is viable in the mass market

By now, plenty of educated guesses have been offered up about what the next-generation Kindle e-reader will look like and do, and fans expect to find out for sure when Amazon.com holds a news conference in New York on February 9.

But even if Kindle's design changes are dramatic, some handheld analysts question how much the e-reader market can grow -- especially when it and other e-reader handhelds can cost more than US$359.

"The Kindle cannot be categorized as a success, yet," Van Baker, a consumer electronics analyst at Gartner said in a recent interview. "The product enjoys rave reviews from mobile professionals, but there are not that many mobile professionals in the market.... We just don't see a mainstream market for this device at least at its current price [starting at US$359]."

E-readers still need to find the mass consumer market, which includes, "for lack of a better description, the 'Joe Sixpack' who comes home and watches football," Baker said.

Until then, Baker wondered how Amazon.com and other e-reader makers can grow much beyond the mobile professional crowd, which tends to include early adopters who generally love to flaunt their tech purchases to friends, and even strangers, during long trips.

"We at Gartner are struggling to see what the compelling value proposition of the Kindle is for the average consumer," Baker added. "For the average consumer, a paperback book and a printed newspaper still work pretty good."

Baker said he knows his views are out of step with the publicity surrounding Kindle, which got a November boost from Oprah Winfrey that goosed sales just before Christmas. And he's aware that more than 1 million Kindles have been sold, a figure that's still far below what is needed for the device to be considered a consumer success.

"Oprah aside, look who's excited about Kindle, and it's the mobile professional who travels a lot -- and the people singing its praises are the technology press or the mobile pros, " Baker said.

In addition to its steep price, Kindle relies on a proprietary file format and limits users to a library that sounds large at 225,000 books, but is still limited, Baker added. "All these factors combine to make the product a niche product for the foreseeable future," Baker said. "It's an interesting niche product, but a niche product nonetheless."

The sluggish economy is only going to make the situation worse "as people cut back on discretionary spending," Baker said.

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