I'm quite intrigued by the Kindle app designed for the iPad. Several months ago, my wife purchased me a Kindle. I love the device, particularly when I travel. With the introduction of the iPad, I began thinking about the issue of switching costs. Would I be reluctant to buy an iPad because there would "costs" associated with switching platforms. Specifically, I worried that I would not have access to all the books I've purchased from Amazon on my Kindle. Well, with the Kindle app, those switching costs go away. You can read your Kindle e-books on the iPad with no trouble at all. iBooks purchased from Apple's e-book store cannot be read on the Kindle at this time. It's relatively rare to have situations such as this one, where the switching costs are not symmetrical. Clearly, this situation may make it much easier for folks to abandon their Kindles and adopt the iPad.
This conclusion about switching costs leads to one obvious question: Why would Jeff Bezos and Amazon decide to make it so easy to switch? Clearly, Amazon wants to be a big player in the e-book market. While they would like to also be a key player in the e-reader market, they don't want to lose out on the e-book market of the future simply because they are trying to protect the Kindle device sales. By making the Kindle app for the iPad and iPhone, they insure that they can compete on multiple platforms for e-book customers. They avoid simply forfeiting all iPad consumers to Apple.
How about Jobs? Is he happy about the Kindle app? Sure, he's quite content in many ways. After all, Apple's iStrategy involves making hefty margins on each of these devices. The broader the array of apps and digital content (music, books, movies), the more likely consumers will purchase high-margin devices such as the iPad from Apple. Since Amazon's e-book library is larger than Apple's at this time, the Kindle app can be helpful in increasing adoption of the iPad.