E-Reader Price Wars: You Out There, Sony?

As of Sunday night, the Kobo e-reader sold by Borders was a $150 gadget that dramatically undercut the $259 pricetag on Amazon's Kindle and Barnes & Noble's Nook. Then B&N cut the Nook's price to $199 and introduced a $149 model, and Amazon responded by knocking the Kindle down to $189. The Kobo is still a cheap e-reader, but not strikingly so-especially considering that it has neither a 3G connection nor Wi-Fi.

So Borders has taken action, but not in the form of a straight price reduction: It's including a $20 gift card with purchase of the Kobo, reducing the effective cost of the e-reader to $129. I don't think Kobo matters enough (at least not yet) for Amazon or B&N to feel forced to react to this price cut. But I suspect that before all the product introductions and price reductions are done with, we'll see three standard price points for e-readers: $200 or thereabouts for 3G models, $150 or thereabouts for slightly less fancy ones, and $99 or thereabouts for basic models that you might still plausibly want to own.

Still to be heard from: Sony, whose $169.99 Reader Pocket Edition and $199.99 Reader Touch Edition are now a tad pricey-and whose already-big-ticket $349.99 Daily Edition is totally out of whack with the e-reader economics that Barnes & Noble and Borders established this week.

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