Amazon Kindle

Ebooks now outsell paperbacks says Amazon

Amazon now sells more ebooks than paperbacks in the US, the online retailer has announced.

Amazon, which began as a web bookseller and is now at the forefront of digital publishing, said Kindle books have now overtaken paperbacks as its most popular format. It said last summer it was selling more digital books than hardcovers.

Amazon has enjoyed headlines and rapt admiration on Wall Street over the past year for its Kindle e-reader, the top selling such unit on the market, and its double-digit growth.

Over 83 per cent of books available in the US Kindle store are $US9.99 or less, Amazon said. It has tried to keep prices low to encourage adoption.

Although Amazon does not disclose sales or profit data for its Kindle e-reader or content, many believe it derives more profit from digital books than from its Kindle devices and say that content is a better bet for its long-term growth.

However, its profit margins were sliding as it spends money on massive new distribution centres and acquisitions. The company recently acquired UK DVD and Blu-ray distributer Lovefilm.

Amazon disclosed last year that it was spending on 13 new distribution centres, and on Thursday said that more would follow, without providing a number. The cost to bring those to full productivity would weigh on short-term margin, said chief financial officer Tom Szkutak.

"You should keep in mind that with the sheer amount of capacity that we added in 2010 ... we don't get the optimum productivity on day one," Szkutak told analysts.

The company also reported slightly lower-than-expected sales for the fourth quarter, which includes the holiday season, as it offered discounts and free shipping to attract customers.

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