New chip will "slash cost" of eBook readers

 

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By Reuters

Posted on 1 Mar 2010 at 16:58

Freescale Semiconductor says its latest chip will help drive down prices in the next generation of eBook readers.

Freescale's next-generation chip combines both the applications processor and a display controller on a single piece of hardware, which the company says will cut the retail price by around $30.

"Cost is really the main driver of the market's growth," said Glen Burchers, director of global consumer marketing for Freescale. He said the chip will also allow for faster, more responsive performance.

Freescale, whose chips are already used in Amazon's Kindle and Sony's Reader, says it controls 90% of the market in eBook reader application processors.

Strong growth is forecast for the industry. Research group DisplaySearch expects the global eBook reader market to more than triple in 2010 to more than 14 million units.

Analysts say the market is still limited by high prices. The lowest price Kindle from Amazon is $260, while Samsung's new E10 is about $700. Freescale says the market will open up even more when prices fall below $200.

And some believe the eReader market is already imperiled by a coming wave of touchscreen tablet computers, led by Apple's iPad, which offer eReader-like functionality along with more computing power.

But Burchers said the main demographic for eBook readers - users in their 40s for whom reading is the main leisure activity - ensure that there will always be a market for a dedicated device.

He said Freescale's new chip will be in devices on store shelves by the end of the year.