The Amazon Kindle reader has been a major factor in the growth of the e-book reader and e-book market. Amazon’s original Kindle (now sometimes referred to as the K1) launched in November 2007. The Kindle 2.0 was released in February of 2009 and the large format Kindle DX followed in the summer of the same year.

With a 60% share of the U.S. e-book reader market, the Kindle was the market leader by some way. Sony’s PRS reader, which was released in 2006 in advance of the Kindle reader, was in second place with a smaller, but still respectable, 35% share. Other manufacturers quickly saw the potential of the emerging e-book reader market and either launched or updated readers of their own in order to secure a share of the market.

Companies such as Plastic Logic, Sony, Barnes and Noble, Bookeen and iRex fought to secure their share of the new and fast developing e-book market, but the Kindle’s dominant market position seemed to be impregnable. It was only with the launch of Apple’s iPad that the Kindle had any genuine competition – despite the fact that the two devices are very different.

Since the release of the iPad, e-book reader prices have dropped quite some way. The Kindle 2.0 is selling for just $ 189 at the moment, a significant reduction over the original $ 359 launch price of February 2009. The large format Kindle DX has been upgraded, being fitted with a new improved screen, and has had a price cut from $ 489 to just $ 379. The ticket price of Barnes and Noble’s Nook reader also fell from $ 259 to $ 199.

Whilst the iPad may have engendered a round of price reductions among e-book reader manufacturers, the same cannot be said about the price of the e-books for use with the readers. Prior to the launch of the iPad, Apple had negotiated a deal with the major publishing houses which let them set the price of their e-book editions at pretty much whatever they wanted – as long as they did not allow the same e-book to be offered at a lower price on any other platform. This was seen as good news by the publishers, who had been unhappy with Amazon’s strategy of selling all e-books for $ 9.99 or lower.

Despite having to re-assess their e-book pricing strategy, it’s not a disaster for Amazon. Amazon has always appeared to be more interested in selling books – and e-books – rather than hardware. It’s difficult to see any other explanation for the fact that they have made Kindle books available on such a wide variety of different devices. At the moment, you can read Kindle books on the PC, the Mac, your Blackberry, the iPod Touch, the iPad and any mobile device running Android. So companies like Barnes and Noble, Amazon and now Apple, who have a stake in the future sale of e-books over the life of a reader, can afford to sell the hardware cheaper and profit over the life of the device.

It may be that the future pricing of e-book readers and e-books will tend to favour such companies over manufacturers who are involved only in hardware production. Looking at the number of different devices which Kindle books can be read on, you would have to suspect that, whether or not the iPad becomes the reader of choice for many users, Amazon will continue to have a huge say in the future of books and e-books for the foreseeable future.