Freescale’s new chip to make e-readers cheaper

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Prepare for a wave of cheaper e-readers later this year, powered by the next generation of chips from Freescale Semiconductor.

By combining an applications processor and display controller onto a single piece of hardware, Freescale says the chip should cut retail e-reader prices by $30. It will also make e-readers faster and more responsive, with longer battery life and support for color screens. Freescale spokesman Glen Burchers told Reuters that devices running the new chips should be available by the end of the year.

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Freescale's new chip to make e-readers cheaper

E-readers have already become somewhat of a hot tech trend — Amazon claimed that its Kindle was the best-selling product on its Web site during the holiday season — but analysts say lower prices are needed to make e-readers popular in the mainstream. Research last year by Forrester found that most consumers won’t go for an e-reader unless it breaks the $100 barrier.

The Kindle sells for $259, making it one of the cheapest e-readers on the market along with Barnes & Noble’s Nook. Cheaper e-readers can be had, but with smaller screens and missing features such as Wi-Fi book downloads.

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Obviously, e-readers have a long way to go before they reach the prices Forrester says are necessary for mainstream adoption, but Freescale’s new chip is a start. It’s also possible that consumer attitudes might change in ways that could help or hurt the e-reader market. On one hand, these devices could become more desirable if more people are seen carrying them around, or if online bookstores figure out a way to make lending and transferring between devices more palatable. On the other hand, there’s still the threat of multi-purpose devices, such as Apple’s iPad, which offer more features, albeit at much higher prices.

And here’s the twist: Earlier this year, Freescale released a reference design for $200 tablets. If those designs become reality, tablets could beat e-readers to the punch.

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