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The Amazon Kindle reader has been instrumental in the development 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.

The Kindle reader took a 60% share of the American e-book reader market and led the market by a long way. The Sony reader, which hit the market in 2006 before the Kindle, trailed in second place with a share of approximately 35%. Other manufacturers quickly saw the potential of the emerging e-book reader market and either developed or updated readers of their own in order to secure a share of the market.

Companies such as Sony, Barnes and Noble, Bookeen, Plastic Logic and iRex did their best to get their share of the new and fast developing e-book market, but the Kindle’s dominant position looked to be pretty much unassailable. It wasn’t until the appearance of the Apple iPad that the Kindle had any credible competition – even although the two devices were very different and would appeal, you might think, to different audiences.

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. Barnes and Noble have also slashed the price of their Nook reader from $ 259 to $ 199.

Although the iPad seems to have provoked a round of price cuts among the manufacturers of e-book readers, the same cannot be said about the price of the e-books to read on these devices. Prior to the launch of the iPad, Apple had negotiated a deal with the major publishing houses which let them fix the price of their e-book editions at pretty much whatever they wanted – as long as they did not permit the same e-book to be offered at a lower price on any other platform. This was well received by the publishers, who had been dissatisfied with Amazon’s policy of pricing all e-books for $ 9.99 or lower.

Although Amazon may have had to rethink their e-book pricing policy, it’s not a major setback for them. 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. Currently, you can read Kindle books on the PC, the Mac, your Blackberry, the iPod Touch, the iPad and any mobile device which runs Android. So companies like Amazon, Barnes and Noble and now Apple, who have a stake in the future sale of e-books over the life of a reader, can take the opportunity to sell the hardware for less and still make their profit over the lifetime 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. Considering the number of different devices which Kindle books can be read on, you would have to suspect that, even if 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.