Will Kindle take off in China?

Amazon's Kindle e-reader is now available in China. But the Chinese Government may not be a fan and, as many Chinese use their phones to read books, the Kindle may face an uphill battle.

Amazon’s Kindle launch in China is a major milestone for the online retail giant, which has been working to enter the Chinese market for years.

With the launch of its Kindle e-reader in China Friday, Amazon has officially entered what may become the most lucrative e-books market in the world. Amazon began selling two Kindle devices – the Kindle Fire HD and the Kindle Paperwhite – on its Amazon China website as well as through major Chinese electronics retailer Suning. The devices retail for 849 yuan (about $138) for the Kindle Paperwhite, 1,499 yuan (about $244) for the 16 GB Kindle Fire HD, and 1,799 yuan ($293) for the 32 GB Kindle Fire HD.

China contains the world’s largest population of Internet users and Amazon’s Kindle launch there is a major milestone for the online retail giant, which has been working to enter the Chinese market for years, according to Bloomberg Businessweek. Amazon is investing “heavily” in China, Thomas Szkuktak, Amazon’s chief financial officer, told Bloomberg Businessweek in a January conference call.

The company released its Kindle e-reading mobile apps and e-book store in China in December and just last month opened its Appstore for devices using Google’s Android mobile operating system. Nonetheless, Amazon may encounter some roadblocks in China. For starters, it’s already been under investigation by the Chinese government to determine whether it violated regulations by selling digital publications.

Surprisingly, Amazon hasn’t yet built up significant market share in China and faces stiff competition from local competitors like Alibaba Group Holdings. And while many Chinese read digital books, they tend to do so online or one their phones, rarely on e-readers or tablets, according to a Forrester Research analysis, something Amazon is struggling to change. Finally, e-book piracy is common in China, which Amazon is combating by pricing its e-books very low – 10 yuan ($1.63) compared to $10 or more in the US.

 Getting a foothold in the Chinese market will be among Amazon’s most difficult challenges – albeit one that comes with very lucrative rewards.

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