A price war has erupted in the electronic book (ebook) reader market following the success of Apple’s iPad tablet computer (pictured). Yesterday Amazon and Barnes & Noble slashed prices of their Kindle and Nook devices, respectively, in an effort to battle Apple’s product. Amazon announced a US$70 price cut to US$189 just hours after Barnes & Noble lowered the price on its own 3G compatible Nook to US$199. Both had cost US$259. Barnes & Noble also introduced a Wi-Fi only version of the Nook for US$149. The first version of the Kindle sold for US$399 in November 2007 at launch.

Apple launched its iPad in April, a multimedia colour device that includes the iBookstore. Although it is significantly more expensive than the Kindle and Nook, the iPad had sold over two million units as of the end of May. Analysts believe specialist ebook readers such as Kindle and Nook will continue to face strong competition; indeed, shares in both Amazon and Barnes & Noble fell about 3 percent yesterday.