Ending a week of heavy media speculation, Amazon.com CEO Jeff Bezos unveiled the new, larger-format Kindle DX in front of about 200 journalists and camera crews at Pace University in lower Manhattan. Using a giant projection screen, Bezos delivered a presentation on the Kindle DX, which is essentially a Kindle 2 with a bigger, 9.7-inch screen; a new “native” PDF reader; and three gigabytes of storage that will sell for $489. Bezos also announced agreements to launch a pilot program with six universities that will distribute the Kindle DX to students and load the devices with textbooks from three of the largest U.S. textbook publishers—Pearson, Cengage and John Wiley—as well as a newspaper deal with the New York Times, Boston Globe and Washington Post. But while much of the early speculation about the Kindle DX focused on its ability to deliver newspapers, Amazon's pilot agreement with the universities and publishers seems just as critical to the device's future and fraught with many pitfalls.

Despite the Kindle DX's enhanced display (and a few new but minor features), questions remain about whether the device is likely to gain traction in the newspaper market, let alone in a higher-education textbook market long focused on highly discounted, full-color digital textbook editions. In published reports, Dallas Morning News publisher James Moroney has already noted that Amazon's terms to newspapers (Amazon gets 70% of revenues and wants licensing rights) are not looked on favorably by the industry. And while the universities involved in the school distribution agreement—Arizona State, Case Western Reserve, Princeton, Reed College, Pace University and the University of Virginia—tout the device's potential utility and the opportunity to survey student feedback, they offer few details of how the plan will be structured. Will either the device or the books be subsidized in some way or will students pay full price for books or device?

When questioned, the answer from both the universities and the publishers has been “more information to come,” including questions about just how many students will be involved in the pilot. At the press conference, Case Western president Barbara Snyder said the Kindle DX pilot would put “thousands” of books on the device and allow the schools to “see how the device affects learning and relationships with teachers.” Pace University provost Geoffrey L. Brackett told PW he expects to have at least 50 Pace students “from discrete sections of coursework,” including students from its publishing program, in the pilot program by the fall semester. Brackett suggested that Pace may subsidize some of the cost of the device while students pay full price for the e-textbooks; he was quick to emphasize “we're still working out the details.”

While there have been reports that the pilot may include only about 300 students, at the press conference Laura Porco, director of Kindle Books, told PW that the pilot would include “hundreds to thousands” of students as well as “hundreds to thousands of books.” She also stressed to PW that Amazon did not plan to discount the e-textbooks used in the pilot. While Amazon has offered professional titles in Kindle editions, it's a first for Amazon to offer Kindle editions of highly formatted academic texts for higher education. Asked about pricing, Pearson spokesperson Wendy Spiegel said she was unable to provide answers just yet. “The ink isn't dry on this agreement,” she said, noting that the books, the disciplines covered and the price points were still to be discussed in “conversations to come.” PW received a similar response from John Wiley and Cengage. Spiegel also pointed out that in 2008, 25% of Pearson's textbook sales from pre-k through higher education come from digital content. Indeed, Pearson offers students access to Web-based texts through CourseSmart, a consortium of six major textbook publishers (including the three publishers in the pilot), that offers access to more than 6,000 digital texts at half the list price of the print edition. Do students (and universities) really want a new device designed to provide access to more expensive digital textbook editions?

That said, Kindle is undeniably popular among customers. Bezos said 35% of all Amazon book sales of titles available in print and digital formats are Kindle editions, up from 10% early in the year. But can a large-screen black-and-white dedicated reading device that costs nearly $500 with relatively low computing power and a clunky mechanical navigational system compete in an educational marketplace in which students often have powerful full-color miniature netbooks ($500 and much less) and laptops (just as cheap)—not to mention a slew of sleek touch screen handhelds like the iPhone and iPod Touch? So far, neither Amazon, the publishers or the universities present at the Kindle DX press conference seemed able to provide any answers to that question.