Amazon drops Kindle 2 price to $299 as of today

The Kindle 2 price was dropped by Amazon from $360 to $299 today.

UPDATE 7/8/09 - 11:32 PM at bottom of this article cites various statements about the reason for the price change, which is not short-term.

I checked the comments areas in a few places, and people who just recently bought Kindle 2s (within the last 30 days, since one can return a Kindle within 30 days for a refund anyway if not interested in keeping it) are being given $60 refunds when they request one.

The phone number for Kindle customer service is 866-321-8851.

This puts the price close to or even below competitor 5" to 6" models just coming out this month without the annotation, inline-dictionary, search, and 24/7 wireless features.

I haven't seen an Amazon statement yet but will write more when I see more. [See later updates below.]

UPDATE - July 8, 2009, 6:02 PM (Original posting at 5:18 PM)
I have seen blogs again repeating the erroneous "DRM" issue* report that made the blog rounds a few weeks ago, based on a conversation with a first-tier customer service rep that there is a limit on the number of times a book purchased from Amazon can be downloaded.  The customer service representative's information was wrong. The limitations policy, readable at the Kindle Amazon support pages states

"
[Q]  How many Kindles can I use to access titles in my library?

[A]  Most books and other non-subscription items you purchase from the Kindle store may be simultaneously accessed for your personal use on to up to six Kindles (or Kindle compatible devices) registered to your Amazon.com account.

If you reach the device limit and wish to replace one of your current devices with a new one, you must first deregister and delete the content from the device you wish to replace before you can access the content in question from your new device. Please see the "Registering Your Kindle" section of our Managing Your Kindle Settings Help page to learn how to register/deregister your Kindle.  There is no limit on the number of times a title can be downloaded to a registered device.

Subscription content can only be downloaded to one Kindle at a time, and only the seven most recent issues will be available for redownload from your Kindle or from the Manage Your Kindle page.
"

This policy has essentially allowed up to 6 Kindles belonging to one account holder, to share a book. The devices sharing include a non-Kindle device such as the iPhone or iPod.  The word "most" allows for exceptions but in a year of participation in many Amazon Kindle forum, the only time I've seen customers actually coming up against the 6-device limit was when defective Kindles returned still had a license registered by Amazon for it and these were removed upon request by the customer.  I have said that Amazon should automate the license removal on any returned Kindles.  Of course, families with many Kindle devices sharing an account will run up against the 6-device limit more readily than one person will.

With periodicals and subscriptions, there is a limit of 1 device at a time rather than 6 and there is a time limit by agreement with periodical publishers on when Amazon is allowed to keep the old issues redownloadable (or successfully transferrable).
  One cannot download issues older than that time from your Amazon Kindle management area nor move an older issue from an older Kindle to a newer one, which I have found the one real 'DRM' issue in that you certainly don't 'own' your magazine issue if it's older than 7 or so issues and you want it to be displayed on a newer Kindle you bought when you no longer have the older Kindle.  Because Amazon has made no Amazon procedure possible to change the device ID given a magazine/newspaper license, it can't be displayed on the new device (without resorting to cyberspace utilities that can remove the device-ID field info, information that of course Amazon strongly discourages forums or blogs from linking to, as copyright concerns are an issue, but if anything should happen to Amazon, at least we know there are workarounds).

---

UPDATE - 7/8/09 - 11:25 PM
The NY Times blog gave this reason for Amazon's decision to drop the price on the Kindle 2.

In an e-mail message, Andrew Herdener, an Amazon spokesman, said the company was passing on savings to consumers from the increasing volume of Kindle sales and the decreasing costs to manufacture the digital reading device.

Amazon’s jumbo-size Kindle DX, which it introduced in May, remains $489 and is currently out of stock on the site.

AP reporter Rachel Metz quoted Amazon's spokeswoman Cynthia Portugal:

Amazon spokeswoman Cinthia Portugal said the price cut, a classic move in electronics marketing, is not just a short-term promotion.

"We've been able to increase the volume of Kindles we're manufacturing and decrease the cost of doing so," Portugal said.

ThinkEquity analyst Ed Weller opined for AP that

[The $299 price] "feels like a much hotter price" than $359.

"They'll sell more of them, and they'll sell more books," he said. He doesn't expect Amazon to follow the Kindle price cut by raising digital book prices.

"DRM" - Digital Rights Management Below are ways to Share this post if you'd like others to see it.
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Banned Amazon user loses Kindle access ?

A customer banned from access to management of his purchased Amazon Kindle books and from ability to buy more Kindle books has had his predicament described by online media, including the usually thorough Wired, with wild inaccuracy, including the claim that the banning was turning Kindles into "$360 paperweights."

Hardly, since the books remain on said Kindles, though some readers have bought the claim, repeating to one another that Amazon wiped out the files from the Kindle.  The customer has been reinstated with a warning, the customer writing that an Amazon rep had referred to his returning "virtually everything" he'd purchased.

The problem of loss of access to management of one's Kindle library at Amazon is an issue that's very important to address though, because a ban against further purchases shouldn't be tied to the ability to manage the customer's Amazon library of books a user bought which should remain available to the user - and the Kindle is sold for what it can do, a main focus being the ability to instantly download books.  For non-Kindle users: "manage" in this case means to be able to download again to your Kindle any material you had decided to delete earlier, since a feature of the Kindle unit is that Amazon stores the books (and your highlighting and annotations) for you for retrieval as needed if you've deleted them from the Kindle.

But on this important issue, there has been careless reporting that occurred beginning with the first posting I'd seen on a news site days ago, to be repeated over and over again, this time even by Wired's Bruce Sterling (a posting which does not allow comments).

The main source for the story is a humongous forum thread started by the customer who was banned, ostensibly for returning several "large electronics" later described by him as "2 TVs and 'several' cameras."  Some members are a bit dubious about some of it because the customer posted exact-duplicate posts on the Amazon forums, which require an active account in 'good standing'... and once the issue was resolved, the user has not responded to questions about the particulars.

For the record, since this report will keep circulating, ArsTechnica repeated the errors of reporting, but users corrected them in the comments areas (which do not get the same kind of distribution).

"Zayin" posts a comment with a few actual facts:

'There are a few inaccuracies in this article...

"...reportedly due to an overly high volume of returns on their Kindle books"
  The "high-price" returns were not returns on Kindle books, but rather returns on "large electronics" purchased via Amazon. Amazon will (apparently) lock your account if they think you are abusing their return policy. Other retailers will do the same...

"...which also locked him out of accessing his already-purchased Kindle items."
  This is partially incorrect. He wouldn't be able to redownload any books he had already purchased, or continue with subscriptions (if any) that had been purchased. However, any books already on the device would still be there, and any materials backed up to disk would still be usable as well.

"...turning their Kindles into $360 paperweights."
  The Kindle would still work as an ebook reader for any already downloaded content or content purchased from other sources. Most of my ebooks have come from Baen, not Amazon.

"A bookstore that locks you out because you treated it like a library doesn't take away the collection already sitting on your bookshelf, after all."
  Neither does Amazon, unless you leave all of your media on their servers, and keep nothing either on your Kindle or backed up to hard disk. I suppose that is possible, but it seems unusual, to say the least.

"Amazon is perfectly capable of yanking customer access to their books at any time—whether the service shuts down or not. The only way to get around it would be to break the user agreement with Amazon and crack the DRM..."
  This is inaccurate. If you have content downloaded, you can back it up easily. Plug the Kindle in to a USB port and copy the stuff to disk. As far as I know, Amazon has no method of pulling access to media already on a Kindle either (if you are really paranoid on this, simply disable the wireless)...'

"_fluffy" writes:

'I worked on Kindle, and wrote one of the DRM components (which was something I put off as long as possible, and basically tacked on at the very end).  The Kindle DRM is purely about keeping the publishers happy.  We didn't want to do it, but the publishers wouldn't allow us to sell their books if we didn't.  It was a make-or-break thing for the device's entire business model.'

 Again, it's my strong feeling that management access to one's Amazon Kindle Library of purchased books shouldn't be tied to a general banning of further purchases.

UPDATE:  A communique across the vast cyberspaces through which I can apparently toss a comment after all :-) Would that the K1 had lived as long as a hamster!  And you've a point: what happens to the entirety of Western Cybercivilization when the USA gets metabolized by the People's Republic of China (where gray Kindle screens first awake, sluggishly, and the PRC is looking to foreclose on us). Below are ways to Share this post if you'd like others to see it.
-- The Send to Kindle button works well only on Firefox currently.

Send to Kindle

(Older posts have older Kindle model info. For latest models, see CURRENT KINDLES page. )
If interested, you can also follow my add'l blog-related news at Facebook and Twitter
Questions & feedback are welcome in the Comment areas (tho' spam is deleted). Thanks!