Taiwanese Co. Buys E-Paper Creator for Amazon Kindle, E Ink, for $215 Million

For all the hype surrounding e-retail leader Amazon.com’s (News - Alert) larger-size e-book tablet, the Kindle DX – its new June 10 release date, ability to rescue the newspaper industry, iPhone integration, or paid blog subscription plan – the success of the device ultimately will boil down to usability, as all consumer electronics products do.

 

And with the $489 Kindle DX, much of that hinges on readability. Not readability as in sentence structure or grammar, but readability as in “this hurts my eyes.”

 

Consider that officials from one startup that’s readying its own e-reader, Pixel Qi (News - Alert), which is bringing out its 3qi model, point to the screen’s readability when touting the device as a potential Kindle challengers.

 

John Ryan, chief operating officer at Pixel Qi, said this: “What you’re looking at is a screen that’s entirely reflective. It’s just running like e-paper so that it’s running on the ambient light. It’s not fighting the office light, it’s not fighting the sunlight. That makes it better for reading but it also cuts the power consumption. The backlight in the screen is typically the largest power drain in any notebook computer.”

 

So it’s a big deal for Amazon that the company that created the display for its Kindle products – E Ink Corp. – is being purchased by a Taiwanese company, Prime View International, for $215 million.

 

Officials say the deal will bring new opportunities for electronic paper, or “ePaper” display screens’ development.

 

As one analyst – Vinita Jakhanwal of iSuppli – notes, the market for electronic book devices such as the Sony Reader and Amazon Kindle is predicted to grow from 1.1 million units in 2008 to 20 million units in 2012, a cumulative annual growth rate of 105 percent over the four-year period.

 

“PVI and E Ink enabled this market back in 2005 and they have been the display market leaders ever since,” Jakhanwal said.

 

The chairman and chief executive officer of PVI, Scott Liu, said that the world is “searching for green technology that saves energy and cuts waste and still provides an outstanding experience.”

 

“E Ink’s electronic paper meets those needs, especially in electronic publishing and mobile displays,” he said. “The people in both companies will unite to provide the world’s best digital reading experience and that will benefit all our customers and end users.”

 

For Amazon.com’s sake, we hope the sale of E Ink simply brings more attention to the Kindle DX – a device that’s garnered more advance press than any other single device since last summer’s launch of the iPhone (News - Alert) 3G – and doesn’t mean that the burgeoning e-book tablet market is already over-crowded.

 

Devices such as netbooks have emerged as bright spots in this slow economy for the struggling consumer electronics market, but it isn’t clear whether e-book tablets are going.