The Motley Fool versus the Kindle

The Motley Fool logo

We live in an interesting time. In less than 20 years, Amazon’s grown from a no-profit bookstore into a giant that sells everything. And yet, is the company really earning a profit? I always enjoyed the analysis at The Motley Fool, which make questions like these sound like a fun bar-stool conversation. And this month they published a brand new article about Amazon’s Kindle tablets — revealing that when it comes to selling ebooks, movies, and TVs, Amazon has finally found a sweet spot.

“A year or two ago, it was hard to find much evidence that Amazon’s Kindle strategy was working as expected,” writes Adam Levine-Weinberg (a senior analyst for the Fool web site). Back when Amazon first launched their Kindle Fire tablets, it didn’t result in a massive increase in their sales of movies and ebooks. “Amazon’s North American media sales rose just 15% in 2012,” writes the analyst, “slightly below the 2011 rate and well below the growth rate of most of Amazon’s other segments.” And in fact, through June of last year, the growth in Amazon’s media sales actually seemed to be decreasing from what it had been in the previous year.

But by December, the year-to-year comparisons were telling a happier story. Over the previous 12 months, Amazon’s sales of e-books, movies, and TV shows grew by a whopping 21%. There’s an interesting caveat. Apparently Amazon actually earns three times as much money on “electronics and general merchandise” as it does on ebooks and media sales. But as things start to cool off on the gadget-selling business, investors will be delighted to see that Amazon’s actually selling more media to view on those gadgets…

Of course, the Fool hasn’t always been bullish about everything Amazon does — and it’s really fun to look back at what they’ve written about the company over the years. Back in 2010, they complained about the metaphors Amazon used to avoid giving specific numbers about how many Kindles they’d actually sold. One article complained it’s “like having a discussion with a kindergartner or a politician. They all tell you what they think you want to hear…but lack the details you really need to know before drawing your own conclusion!”

So it was a big deal in December of that year when Amazon finally did reveal a number — sort of. “Amazon still isn’t coming clean with how many Kindle e-book readers it’s selling,” the site reported, “but at least now we know that it will be in the ‘millions’ this holiday quarter alone.” They headlined their article “It’s Raining Kindles!” and soon there was even more big Amazon news. Last year a business analyst at The Motley Fool pointed out that people who join Amazon’s Prime program ultimately use Amazon for the majority of their online shopping, and end up spending more than twice the amount spent by non-Prime members!” (The average Prime member spends $1,200 a year on Amazon’s web site….) And with their latest increase in the sales of digital media, The Motley Fool reached the only conclusion possible.

“Amazon’s quest for long-term dominance in the market for books, music, and movies is back on track!”

What Is the Book in Amazon’s Newest Kindle Ad?

Woman in bikini reading at beach in Amazon Kindle Paperwhite ad

Watching TV, I just spotted a brand new ad for the Kindle. (Amazon’s touting the Kindle Paperwhite, so their ad shows a woman in a bikini enjoying an ebook in a beach chair — while the unhappy people around her struggle to read their own tablets in the bright sunlight.) There’s a short shot of the clear, crisp letters on her Kindle’s screen, and it always makes me want to ask the same question.

So what ebook is she actually reading?

Fortunately, you can pause the video long enough to read some of the sentences — and if you type them into Google, you can reveal the secret answer. It turns out that the woman at the beach is deeply engrossed in a 434-page thriller by Gillian Flynn. It’s called Gone Girl, and it became a best-seller in 2012 just a few weeks after it was released, ultimately selling more than two million copies.

For a shortcut to the ebook, point your browser to
tinyurl.com/GoneGirlEbook

It tells a darkly intriguing story about an unhappy couple that’s been married for five years — when the wife suddenly goes missing on their fifth anniversary. That’s why the book is titled “Gone Girl”, and the title of the chapter being read in the Kindle ad is “THE DAY OF…”

“…through it, trying to catch and pin down her thoughts. What are you thinking, Amy? The question I’ve asked most often during our marriage, if not out loud, if not to the person who could answer. I suppose these questions stormcloud over every marriage: What are you thinking? How are you feeling? Who are you? What have we done to each other? What will we do?

My eyes flipped open at exactly six a.m. This was no avian flutter­ing of the lashes, no gentle blink toward consciousness. The awaken­ing was mechanical. A spooky ventriloquist-dummy click of the lids: The world is black and then, showtime! 6-0-0 the clock said—in my face, first thing I saw. 6-0-0. It felt different. I rarely woke at such a rounded time. I was a man of jagged risings: 8:43, 11:51, 9:26. My life was alarmless.

At that exact moment, 6-0-0, the sun climbed over the skyline of oaks, revealing its full summer angry-god self. Its reflection flared across the river toward our house, a long…”


You can read the whole chapter onlineNPR Books published a much longer excerpt back in May of 2012 when the thriller was first released. I cheated and read a summary of the book’s plot on its page on Wikipedia, and I’ll just say that as expected, this book definitely has a lot of plot twists! And apparently there’s also a movie version that’s in production starring Ben Affleck as the possibly-murderous husband!

But best of all, you won’t have any trouble reading this page-turning thriller in the bright sunlight at the beach — as long as you’re reading it on your Kindle!

For a shortcut to Gone Girl, point your browser to
tinyurl.com/GoneGirlEbook

President’s Day on the Kindle

President Abraham Lincoln reading a book

All across of America, it’s “President’s Day”, and it’s got me remembering the day when I almost met President Clinton. He was helping a school in my town install the cables for internet access in 1996 — along with Al Gore — and I was covering the event for a local alternative newsweekly. Some of the volunteers that day wore t-shirts that said “I connected our kids to the future.” And in the teacher’s lounge, I’d found the left-behind remains of sandwich from a local deli, with the word “president” written on a plastic cover. (It was left behind under a sign which read “Your mother doesn’t work here, so clean up after yourself!”)

It was a weird moment, when I realized that when there’s a new technology, we’re all “pioneering” our way towards it together. And 16 years later, when that future finally arrived, I feel like we’d ended up doing it again, moving together as an invisible group, this time towards a new reading technology. Shortly after the inauguration of President Obama, CNN reported that former President Bush had returned to Texas, where he was “meeting the neighbors, making trips to the hardware store, and catching up on some reading via a Kindle.” The same article notes that his wife Laura had a Kindle too. And that same month, former vice president Dick Cheney revealed he also had a Kindle.

But it’s not just that the Kindle was being used by a handful of White House occupants. After receiving a $7 million advance, former president Bush soon released his new autobiography. By the end of its first day — counting pre-orders — he’d sold 220,000 copies and delivered nearly $4 million in book sales. But the former president also discovered that nearly 23% of his readers were buying it as an ebook!

A new world may be emerging — an accidental community of early adopters — since the publisher’s spokesman said the figures demonstrated the “rapid growth” of the ebook market. (I calculated that thatwas over half a million dollars worth of ebooks sold in a single day!) The publisher also revealed that at the time, it was their highest one-day sales in six years — since they’d published the autobiography of former president Bill Clinton. But there’s also something significant about the fact that even Clinton’s biography is now available as a Kindle ebook, along with several by Ronald Reagan, and even more by Jimmy Carter…

And in 2011, even president Obama released a new book — and also decided to make it available on the Kindle. It was a children’s book called Of Thee I Sing: A Letter to my Daughters, and it’s got its own perspective on the way America has changed. It looks back to past presidents like George Washington and Abraham Lincoln, but also ordinary citizens who made a difference, likeMartin Luther King Jr., Helen Keller, Georgia O’Keefe, and Jackie Robinson. It’s fun to think that this will be the first generation of children who may be reading these classic stories of American history on a Kindle!

The world keeps on changing, both in big ways and in small. (One political blog reported that President Bush now seems more interested in his iPad than his Kindle, and according to his wife Laura, he’s “constantly” playing the Scrabble app.) But 14 years ago, The Washington Post once reported, there was an even bigger challenge confronting ebook author Barack Obama: obscurity! “In the summer of 2000 when he flew from Chicago to Los Angeles for the Democratic convention and no one knew him, his credit card bounced, and he left after a forlorn day hanging out as an unimportant face lost in the power-lusting crowd.”

It all goes to show that a lot can change in 14 years — both for politicians, as well as the rest of us!

Valentine’s Day Fun on the Web!

Roses on an Amazon gift card

It’s Valentine’s Day all around the world — and some of the celebration has even found its way to the web. Amazon is sharing some fun ideas for last-minute Valentine’s Day gifts, and there’s also an ebook sale at Barnes and Noble, plus some special offerings from Google and O’Reilly Media!

“It’s Not Too Late” read a headline this morning on the front page of Amazon. They’re offering specially-designed gift cards with a Valentine’s Day theme that you can print out (today!) as a gift for your sweetheart. (And for some of the cards, they’ll even let you include your own picture!) But for an even fancier twist, they’ll let you deliver your digital Valentine’s Day gift certificate via Facebook — and one of their choices is a full-motion “Video Starring You”. You upload photos of yourself and the ones you love to, in Amazon’s words, “Create a hilarious JibJab video starring you or your friends.” (One of them features Sonny & Cher’s classic ’60s love duet “I’ve Got You Babe” — and the video splices your photos onto the bodies of two hippie flower children! )

Jib Jab video of Sonny and Cher singing I Got You Babe

Some of the other digital gift cards are also animated (like this lovely cartoon from Hallmark showing two doves kissing…) In fact, there’s more than 350 cards to choose from — though that’s their entire selection for the year, so some have a “birthday” theme or make specific mentions of other holidays. Of course, Amazon’s also offering a discount today on their Kindle Fire tablets. Amazon’s giving an $80 discount today on their big 8.9-inch Kindle Fire HD (or $40 off on their newer Kindle Fire HDX). And the smaller 7-inch tablets have also been discounted, too — a Kindle Fire HD now costs just $124 today, and the Kindle Fire HDX is just $199…)

For a shortcut, just point your web browser to
tinyurl.com/KindleFires

Amazon Holiday Sale on Kindle Fire HDX

But Amazon’s not the only one who’s getting into the holiday spirit. If you visit the web site for O’Reilly Media today, you’ll discover that their technology ebook sale has a special Valentine’s Day twist. Their offering a 50% discount on any of their books which have a cover that’s pink! “This year, forego the mushy cards and chocolates and get to the heart of your passion,” reads the tongue-in-cheek message on their web site. (“From Python to Git to Erlang to C — and everything in between — these titles are sure to excite….”)

And if instead you’re the kind of geek more interested in mobile gaming, the Nook Store is giving away a free app today that plays 12 different card games — all for single players — “now including special Valentine’s Day graphics!” (And their discounted ebook of the day is complete box set of the Stars of Mithra trilogy by best-selling romance author Nora Roberts — all three volumes for just $2.14.)

This morning I noticed that even Google’s getting into the fun. Their Google Play Store has discounted five “romance reads” to just 99 cents, and they’ve also got a free video from Walt Disney studios with a Valentine’s Day theme. They’re also touting a “75% Off” sale on inspiring biographies that lasts all weekend long. But there’s also a very special animation on the Google home page with a very touching message. There’s six candy hearts, but when you click on them, a poignant audio clip starts to play. “For Valentine’s Day, as people everywhere search for love — something a search engine might not be the ideal tool for — each of these candy hearts brings you a true story of love,” begins the narration by “This American Life”. But then it switches to the voices of real people, who describe when they first fell in love.

Happy Valentine’s Day, everybody!

Amazon vs. The Daily Show

John Goodman represents Amazon on The Daily Show with Jon Stewart

It’s always fun when the Kindle works its way into the public discussion — and Amazon too. Right now Kindle Fire owners can watch a new sitcom starring John Goodman just by going to “Videos” on their Kindle Fire tablets. It’s called Alpha House, and that same show is also available on the web. (For a shortcut, point your web browser to tinyurl.com/GoodmanShow )

The first three episodes are free for anyone, and the whole series is available free to members of Amazon’s “Prime” shipping service. But this all led to a fun conversation that I’d like to stow away in a time capsule. John Goodman appeared on The Daily Show with Jon Stewart to promote this Amazon-only series. And it perfectly captures that moment in time when the world realized: wait, Amazon is producing TV shows?!

Jon Stewart was baffled…


JON STEWART: How does this Amazon thing — I didn’t know Amazon did — did, uh, uh, television shows. Is that a…you click on the site? (Audience laughs) Is that — how… Is that how it happens? Can you use —

JOHN GOODMAN: I don’t know! (They both laugh) I don’t know! I’m selling their product…I’m just a cog in their machine of world domination! I just — as long as they out-point Walmart, I’m cool. No, I uh — there’s a gizmo you buy with Amazon, and then you get free TV with it.

STEWART: Oh this is — so it runs only on the Amazon?

GOODMAN: Yes, as far as I know. (Eyes dart nervously. Audience laughs…)


To watch their whole interview online, you can point your web browser to tinyurl.com/AmazonDailyShow. But what’s really interesting is that John Goodman was wrong! You can also watch Amazon Instant Video on the web (where the first three episodes of his show are already available for free)… The first episode even opens with a funny cameo by Bill Murray!

But then the interview gets into an interesting discussion about how the show is created — and the differences between online and broadcast television.


STEWART: Did they — let me ask you a question. If we go on real TV, we gotta bleep all the **** words out. And that’s the only pleasure of doing television these days, let’s just face it.

GOODMAN: It really is.

STEWART: So here’s how you know if it’s real or not. Do they pay you in Amazon points? If they pay you in Amazon points…

GOODMAN: Who doesn’t get paid in Amazon points?

STEWART: How did they — who was the creator of this program? How did this all…

GOODMAN: Garry Trudeau, the creator of Doonesbury

STEWART: (Audience applauds). Tremendous. That’s wonderful.

GOODMAN: He writes these incredible scripts. They’re very funny, and, uh, Jonathan Alter…

STEWART: Oh yeah!

GOODMAN: Yeah, The great political writer.

STEWART: Writer for Newsweek, and he’s written many different books…

GOODMAN: Yeah, yeah, yeah. He’s a producer, he’s got the political angle on everything, he’s great to have around.

STEWART: That’s awesome. Trudeau is one of those guys, like my heroes, that — growing up and reading Doonesbury and just marvelling at the way he would take these storylines and carry them all the way through with the — you know, the quarterback who’s — working in — all the way through, in Vietnam and everything else. Remarkable guy.

GOODMAN: With the disabled veterans now. It’s an incredible ear. He’s a great writer.

STEWART: Is he on the set? Because I, you always…

GOODMAN: Crossing T’s and dotting I’s!

STEWART: Is he really?!

GOODMAN: Yeah! Yeah… “Well, you left an ‘and’ out of that sentence, John.”

“Hey man, you went to Yale. I don’t argue with that!”


The interview winds down — Goodman says fondly that he went to a state college, and Jon Stewart ends the segment with a burst of enthusiasm. “There you go, brother! John Goodman — never bad in anything.” But maybe because we’re in a unique place in internet history — or because online shopping has become such a phenomenon — they still couldn’t resist making one last joke about Amazon.


STEWART: Alpha House premiers on Amazon.com November 15th, you can watch the first three episodes for free! That’s not a bad deal.

GOODMAN: No!

STEWART: And then, uh, you ultimately end up, uh, ordering a power washer! For no apparent reason.

GOODMAN: But they’re damn good power washers!

Amazon Employees vs. That Amazon Book

The Everything Store - cover of Brad Stone book about Amazon

Brad Stone wrote a new book about about Amazon, and it’s already stirred up a controversy. I enjoyed Stone’s radio interview on Marketplace, but apparently Amazon isn’t one of Stone’s fans. “He had every opportunity to thoroughly fact check and bring a more balanced viewpoint to his narrative,” complains Amazon’s Vice President of Global Communications, “but he was very secretive about the book and simply chose not to.” And one of Stone’s detractors turns out to be the wife of Amazon’s CEO!

In an interesting twist, Mackenzie Bezos is expressing her displeasure with a negative one-star review of the author’s book on Amazon! And it opens with her own vivid and heartfelt perspective on the man she’s been married to for 20 years. “I worked for Jeff at D. E. Shaw, I was there when he wrote the business plan, and I worked with him and many others represented in the converted garage, the basement warehouse closet, the barbecue-scented offices, the Christmas-rush distribution centers, and the door-desk filled conference rooms in the early years of Amazon’s history…”

Her review is titled “I wanted to like this book”, and it’s already received 3,154 “helpful” votes from other Amazon customers. er first complaint is there’s inaccuracies in the book which contradict her own her firsthand memories of the Amazon story. And her second complaint is the negative quotes about the tension in executive meetings create a “lopsided and misleading portrait” of the culture at Amazon. So for balance, she presents some warm and positive quotes drawn from a personal collection — “an archive of the thousands of thank you messages written to Jeff over the years”.

I cried as I read the Career Choice announcement on Amazon today. What Amazon is doing to help its employees is affecting lives in the most meaningful way I can think of. It restores my faith in humanity…

Mrs. Bezos acknowledges that some people in the book describe a “supportive and inspiring culture”, but argues that the author dismisses them as robots throughout the book. And her third complaint is the book speculates about what Jeff Bezos was thinking or feeling, writing that “Hollywood often uses a more honest label: ‘a story based on true events.'” But in the end she points out one of the miracles of life on the internet. Since this book is about real people, the “characters” in the book can step forward “and speak for themselves!”

For example, she cites another review of the book posted on Amazon by Rick Dalzell, who was Amazon’s Chief Information Officer at Amazon for 10 years starting in 1997. “Brad Stone did a lot of research and the result is a glimpse into the history of one of the world’s most exciting companies,” Dalzell acknowledges, though he’s titled his review “Intriguing stories, incomplete and unbalanced history,” and awarded the book just three stars. Dalzell was actually interviewed for the book (along with 300 past and current Amazon employees), and he devotes a whole paragraph to debunking Stone’s interpretation of what it means when Jeff Bezos laughs. “Jeff’s laugh is spontaneous, sincere, warm and endearing. It diffuses stressful situations.” In Stone’s book, Dalzell is cited as saying that Bezos “often” wields the laugh to punish people who aren’t meeting his high standards…

“While I found [the book] rather interesting, lots of stories are missing or just inaccurate. Brad painted a one-dimensional picture of Jeff as a ruthless capitalist. He completely missed his warmth, his humor, and his empathy — all qualities abundantly present in the man.”

And Mrs. Bezos also applauded another review of the book posted on Amazon by Jonathan Leblang, who actually went to high school with Amazon’s founder, and has since become the director of the company’s Lab126 in Menlo Park. He awarded the book four stars, calling it “Interesting, but flawed,” saying it was interesting to see how the company where he worked would be seen by an outsider — but that there were mistakes.

“[A]s with any book where the subject is not an active participant, the book is slanted toward those episodes where Stone can find someone to talk about them. And of course, he includes that which supports his thesis… Overall, from the parts that I know about, about 80% is correct and 20% isn’t (often in details, but incorrect nonetheless). That, of course, taints my view of the book as a whole, because I have to assume that 20% of the stuff I don’t have personal knowledge of is also incorrect.

But even with his concerns about accuracy, he still managed to find something positive (and funny) about The Everything Store: Jeff Bezos and the Age of Amazon.

“That said, I would still recommend the book (and especially the picture of Jeff in High School!)”


Check out the book (and the reviews) for The Everything Store:
Jeff Bezos and the Age of Amazon