“The Kindle Store provides you wide exposure to make your active content discoverable and accessible to a very large community of enthusiasts. We’re looking forward to seeing some great innovation!”

Like iPhone apps, there will be a store where consumers can purchase Kindle applications. There are estimated to be 3 million Kindles in use, makes this a big enough market to lure developers to this new mobile app platform.

The Kindle device is quite different from the iPhone/iPad/Android smartphone platforms, which limits the kinds of applications possible. Games, which require rapid screen update rates, won’t work well on the slow but efficient eInk screen. Lack of a touchscreen (or capable pointing device) or application switching also limits the possibilities quite a lot.

If Amazon is to be successful in this initiative, it seems critical that future Kindles receive upgraded hardware (color touchscreen), and also an upgraded OS with task switching, improved UI, and a more robust API and SDK. That’s going to require very deep level of investment by Amazon. Do they have the drive to compete in this competition long term? Do they have a choice if the book market goes digital?

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But what’s the big picture here?

One thing to consider is that Apple has an amazing competency in the education market, and they may seek to capitalize on this market as a way to introduce the iPad to the mainstream.

Apple has already forged partnerships with several of the largest publishers including notable textbook publisher Macmillan. Kindle has so far failed to capture the education segment of the ebook market, and the current eInk based device is insufficient for many textbook uses (no color, small screen, etc). iPad, for all it’s shortcomings, *may* be a better device to satisfy the textbook market need.

This is a large market, and it is theoretically possible that Apple could incentivize iPad sales by offering not only educational discounts on iPad, but also discounted textbooks to students. A typical college student currently spends between $600 and $1,000/year on textbooks, which means there is enough “meat” here to offer large discounts. Imagine a $199 iPad including $99 in free textbooks. I can think of a few students who might jump at this chance.

What’s missing now is compelling ebook content. The large number of existing ebooks are not very interactive — they are little more than glorified text files. But the EPUB format, which iPad supports, is very sophisticated. Based on XML, full hypertext capabilities and rich media support is included (but not Flash . And iPad is actually a *great* platform for interactive books, given this content is created by the publishers. Something right out of Alan Kay’s “Dynabook” concept.

Now that would really be revolutionary.

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