• Don’t miss today’s Kindle Nation Daily Free Book Alert, Saturday, October 23: Homeland: The Legend of Drizzt, Book I by bestselling Dark Fantasy author R.A. Salvatore, plus The Brightest Moon of the Century by Christopher Meeks (Today’s Sponsor), and over 100 more fully updated and category-sorted free Kindle ebook listings

 October 23, 2010 – 6 pm Eastern
by Kindle Nation’s Crackerjack Army of Astute Undergraduate Interns, and the Editor

The Kindle Revolution continues, if Amazon’s third quarter earnings report is any indication.The company posted a significant increase in top line sales: third-quarter revenue overall jumped 38.7% to $7.56 billion and net income rose 16% to $231 million. Media sales grew 14%.

Where was the biggest increase? No surprise here. “Worldwide Electronics & Other General Merchandise” sales, which is the category that includes the Kindle device and the astonishly popular (and profitable) new lighted Kindle covers, grew 68% to $3.97 billion. For those of you who are keeping score at home, that’s 52.5% of the company’s total worldwide revenue.

That said, Amazon reported that sales of print and digital books increased from the second to third quarter indicating “strong overall book gains.” In this period, the Kindle store expanded to include 720,000 digital books. According to the company, the new Kindles “are the fastest selling Kindles of all time and the bestselling products on Amazon.com and Amazon.co.uk.”

Publishers Weekly reports that Amazon “is expecting a blowout fourth quarter in terms of sales with revenue projected to increase between 26% and 40%, although it said that operating income could be anywhere from down 24% to up 18%.” Always looking for an excuse to create volatility, after-hours day traders interpreted that report to mean “soft margins,” and the stock fell 4% while the markets were closed, but when the market re-opened today investors took over — with a more nuanced understanding of Amazon’s plans to invest heavily in the warehousing and fulfillment costs required to support that “blowout fourth quarter” — and Amazon’s share price closed today at $169.13, three dollars above its previous all-time high and up over 50% in the past 90 days.

Kindles Appeal to Kings and Commoners Alike. A recent USA Today story talks about the growing appeal of the Kindle for book readers and publishers everywhere. Besides citing the recent AAP figure we reported on earlier this week (that e-books now comprise 9% of market), the story quotes some heavy-hitters and ordinary citizens to substantiate that point, including:

• Novelist Stephen King, who says he does nearly one-third of his own reading on an iPad or Kindle, sees e-books becoming 50% of the market ‘probably by 2013 and maybe by 2012.  
• HarperCollins CEO Brian Murray reports ‘a sea change in the past few months’ among new best-selling books: ‘On some books, the e-books are outselling the hardcovers.’          
• Peter Osnos, founder of PublicAffairs Books says “in the same way that people moved from silent pictures to talking pictures to movie theaters to television to television-on-demand. We are adapting to the notion that we can choose where, when and how we read books.”         
• In Roanoke, Va., Liz Jones, 58, a legal secretary, says her iPod Touch with a Kindle app is ‘so much easier to carry than a regular book.’”   

Self-Deprecating Laughter from the Gadget Press? So people who love to read get it, and authors and publishers are coming around, but the last to show up at the party seem to be the gadgetheads and the gadget press. Mediabistro even pokes some fun at itself in putting the spotlight on a November 2007 post in which Center Networks’ presented a “long list of reasons that the new Amazon Kindle [will] fail.”

How long ago was November 2007? There are different ways to count. A little over 1,000 days ago. Or a little over 5 million Kindles ago.

eBook Adoption Slower on College Campuses. The New York Times reports this week that despite the growth of e-book technology, many students at Hamilton College—and campuses nationwide—are still lugging print textbooks to classes.

“They text their friends all day long. At night, they do research for their term papers on laptops and commune with their parents on Skype. But as they walk the paths of Hamilton College, a poster-perfect liberal arts school in this upstate village, students are still hauling around bulky, old-fashioned textbooks — and loving it,” writes Timeswoman Lisa Foderaro.

Foderaro reports that even amidst “a tide of digital books, blogs, and other Web sites” students still gravitate towards traditional textbooks—perhaps because universities and publishers are not adequately emphasizing these new technologies, their usefulness, and their affordability.

“That loyalty comes at a price. Textbooks are expensive — a year’s worth can cost $700 to $900 — and students’ frustrations with the expense, as well as the emergence of new technology, have produced a confounding array of options for obtaining them,” she adds.

The article cites a disheartening statistic from the National Association of College Stores: digital books compose under 3 percent of textbook sales. But, as more academic e-book titles become available, NACS expects that share to reach 10 to 15 percent by 2012

Our take? With exciting projects like the Clearwater High School Kindle project described in our recent post, Hundreds of Kindles May Be Coming to a High School Near You!, it seems more likely that the real tidal wave of college campus Kindle adoption will roll in over the course of the next two or three years as today’s high school students matriculate.

The Nook: RIP or Redux? Long-time readers of Kindle Nation (see Exhibits A, B, and C) may be surprised to find us taking up for the Nook, but we’re not so sure about a Silicon Alley Business Insider post this week in which Pascal-Emmanuel Gobry argues that Barnes & Noble’s should just “pull the plug on the Nook already.” 

Before discussing his chief problem with the Nook, Gobry praises B&N;’s device for its “smart full-color touchscreen,” which was “really nice” in his view.

The issue is very simple: the Nook suffers from a meager catalogue of books—and Gobry says “customers are finding out.” Compared to Amazon’s “huge media store…smartly spreading to every platform,” the Nook affords readers much less.“And Amazon is currently in a battle royale with Apple’s iBookstore to be the dominant store for e-books – and winning. B&N; is imitating that strategy, but we don’t know anyone who reads B&N; e-books on their iPad, and Amazon is promoting the hell out of Kindle,” he adds.

Gobry thinks the Nook is completely out of contention, and here’s the final blow, in his estimation: “This means that between those two giants, Barnes and Noble stands no chance. It’s a retailer. It doesn’t have the software or hardware culture, or the experience of running media stores, that Apple and Amazon have.”

Our take is that, while the Nook until now has been very much in the decade-long B&N; tradition of doing exactly what Amazon does, two years later and not as well, the tables may be turning. Rumors are rampant that B&N; will launch a full-color $249 Nook as early as this Tuesday, and if the company hits a home run it could end up actually taking the fight to Amazon for the 2010 holiday season. Amazon is already planning to copy one Nook feature — ebook lending — in coming weeks.

But we’ll see, and we note that B&N; would have to display much greater product-launch acumen than we saw with last year’s pathetic Nook 1 launch to become a serious player.

Gobry’s focus on catalog is on target, but he whiffs badly on his implication that Apple’s iBooks catalog makes it a contender. iBooks selection and pricing is a big double FAIL, and is the primary reason for a market share discrepancy in which, according to recent reports, the Kindle Store dominates the iBooks Store by 76% to 5% in ebook content sold.