June 22, 2010, 2:47 PM

Borders fires back

Borders joined the e-reader price war by offering a $20 gift card with its e-reader.

Bill Siwicki

Managing Editor, Mobile Commerce

Lead Photo

After yesterday’s opening volleys by Barnes & Noble Inc. and Amazon.com Inc. in an e-reader price war, Borders Group Inc. has fired a shot across the bows of its competitors, offering a $20 gift card and double loyalty points with the purchase of a Kobo e-reader, which it sells through a deal with manufacturer Kobo.

Barnes & Noble yesterday lowered the price of its 3G Nook e-reader from $259 to $199 and introduced a Wi-Fi-only Nook priced at $149. Amazon responded within hours, lowering the price of its 3G Kindle e-reader to $189. Borders seems to be hoping that consumers will see the $20 gift card as reducing the price of its flagship Kobo from $149.99 to $129.99. Unlike the Nook and Kindle, however, the Kobo does not have wireless connectivity; instead, users must download e-books to a computer and then transfer them to the device.

At $149.99 the Kobo is among the lowest-priced e-readers available, and bundled with the gift card, delivers the best e-book reader value available today, Borders contends.

The Kobo offer comes on the heels of Borders’ announcement three weeks ago that it has begun selling a new e-reader, the Libre eBook Reader Pro by Aluratek, for $119.99. The Libre, which can connect to Borders’ Kobo eBook store, does not include all the features and functions of the Kobo, but it can play digital music and display digital photo albums.

The Libre is in line with Borders’ plan to provide a “good, better, best” selection of e-readers that will appeal to virtually any customer who wants to read digital books, the company says, adding it will maintain its device-neutral approach to e-books and will be selling 10 e-readers by year’s end.

The price war dovetails with good news for e-book industry. Among consumers who read more than five books a month, 42% plan to buy an e-reader this year and 9% already own one; only 7% plan to buy an iPad instead of an e-reader, a new survey from consumer electronics shopping and review site Retrevo finds.

Of consumers who read one to five books a month, 24% plan to buy an e-reader this year and 9% already own one; 8% plan to buy an iPad instead of an e-reader this year, says the survey of more than 1,000 U.S. online shoppers. The numbers tighten, though, for very casual readers. Of consumers who read one book every couple of months, 13% plan to buy an e-reader this year and 7% already own one; 11% plan to buy an iPad this year, the survey finds.

“It appears serious readers still prefer a dedicated e-reader,” says Andrew Eisner, director of community and content at Retrevo.

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