Is Kindle profitable? Probably not, Bezos signals at Amazon annual meeting

Amazon.com Chief Executive Jeff Bezos talked up the company's Kindle electronic-book reader at its annual shareholder meeting this morning in downtown Seattle.

But is the Kindle making any money yet?

Bezos' response seemed to be "no."

Amazon's digital-media business is in "investment mode," he said, noting that the Kindle took more than three years to develop.

"If something is successful, it seems to take five to seven years or more before it's a positive contributor to the economics," he said.

Seattle-based Amazon introduced the Kindle a year and a half ago and now offers it in two sizes. The smaller model costs $359, the larger model, $489. Users can download most best-selling books in a minute or less for $9.99 and read them on a black-and-white screen. A color version is years away, Bezos said, adding that the technology "is not ready for primetime."

Other points Bezos made during the hourlong meeting and subsequent Q&A with reporters at the Seattle Art Museum:

• Sales of products costing $500 and up are growing at a slower rate than before the recession. "I think people are being cautious about high-price-point items," he said. "Whether that'll continue I don't know."

• Amazon has been hiring in the recession and — "knock on wood" — will continue to do so across a broad range of departments. As of March, the company employed 20,600 worldwide, up from 17,800 a year ago.

• The company might not ever release sales figures for the Kindle. "There's a competitive advantage in keeping the numbers close. You may just have to remain curious," Bezos said in response to an audience member's question.

Bezos mentioned that more than 285,000 book titles are now available on the Kindle, and where both Kindle and traditional paper versions are available, the Kindle versions account for a little more than a third of all the book's sales — proof, he said, that the Kindle "is turning into something special."

Amy Martinez: 206-464-2923 or amartinez@seattletimes.com