Why hardware ebook readers are a dead end (for now, anyway)

My latest Locus column, "Put Not Your Faith in Ebook Readers," just went live. In it, I discuss the fact what while there's plenty of programmers who'll hack you a little ebook business that runs on a phone, handheld game device or PDA; there's a genuine shortage of high-quality manufacturers who'll build you a great, cheap, hardware-based ebook reader, and that that's likely to continue for some time.

China has experienced the largest migration in human history – 160,000,000 people moved from the inland farms to the coastal manufacturing cities – but it is not endless. Most of the world has shut down most of its factories, shuttering domestic manufacturing capacity in favor of the cheap labor, poor working conditions and environmental controls of China's factory cities. When you go to China to get your Kindle or your Wii produced, you're competing for space among the factories that produce socket wrenches, Happy Meal toys, laptop computers, prison cafeteria trays, decorative tin planters, vinyl action figures, keychain flashlights and cheap handguns.

Frankly, book reading just isn't important enough to qualify for priority treatment in that marketplace. E-book readers to date have been either badly made, expensive, out-of-stock or some combination of all three. No one's making dedicated e-book readers in such quantity that the price drops to the cost of a paperback – the cost at which the average occasional reader may be tempted to take a flutter on one. Certainly, these things aren't being made in such quantity that they're being folded in as freebies with the Sunday paper or given away at the turnstiles at a ballgame to the majority of people who are non-book-readers.

Meanwhile, handheld game consoles, phones, and other multipurpose devices have found their way into the hands of people from every walk of life. In some countries, mobile phone penetration is above 100 percent – that is, a significant proportion of the population maintain more than one phone, for example, a work cellular and a home cellular.

Not only can these devices command the lion's share of China's high-quality manufacturing capacity, but they are produced in such staggering volume (and often distributed with a subsidy – game devices are sold below cost in the expectation of selling games; phones are subsidized by carriers) that they can be had for a pittance.