Business Problem Paper

The Amazon Kindle is a wireless, "convenient, and portable reading device with the ability to download books, blogs, magazines and newspapers" from almost anywhere in the United States (Amazon, 2008). Michael Lewis, the author of Moneyball and Liar’s Poker predicts, “this (the Amazon Kindle) is the future of book reading. It will be everywhere.” (Amazon, 2008). This report will determine whether the current $399.00 price tag is reasonable to successfully support and sustain the sale of the Kindle. It will clearly define the dependent and independent variables of the study, state the null and alternative hypotheses, and the methodology used to test the hypotheses. It will compute the sample size required which will provide clear support for the criteria used. The samples that are selected and produced are described, including the methodology used to collect the data and a description of the survey instruments. A final recommendation is offered regarding whether the Kindle is a good buy at $399, or if Amazon needs to alter the price or product.

What is the Amazon Kindle?

The Kindle is Amazons version of an eBook reader. It has been in the making for three years, first offered to the public in November 2007. It uses eInk, a screen that offers non-glare viewing, and no backlighting which mimics a traditional paper publication feel. Using Whispernet technology and the Sprint network, the Kindle uses wireless access at no cost to the consumer. It offers over 120,000 eBooks that range from $.25 to $2,386.80, with the average eBook costing $9.99. There are 10 national newspapers available for a monthly fee of $5.99 to $13.99 (for the New York Times), as well as 333 blogs, and 15 magazines. See Table 2 for a list of specifics. The Kindle has a QWERTY thumb-keyboard on the top, and holds like a folded book. Other interesting features include