Step 1: Market a device for two whole years
Step 2: Issue a price drop a few months before the holiday season
Step 3: Remain the exclusive retailer for said device
Step 4: Profit! (To an extent that is completely and intentionally unclear to everyone!)

When Amazon tells you that the Kindle is the highest-selling product on Amazon, you're supposed to think of it as you'd think of anything else: as a strong, reliable metric in gauging how well a product is doing in general. The thing is, there is no "in general" for the Kindle. There is only Amazon. Anyone who wants a Kindle and doesn't normally shop at Amazon has to make an exception. Anyone who wants a Kindle and doesn't normally shop online has to make an exception. The Kindle didn't outsell the iPod Touch—not even close.

It's worth noting that, as always with the Kindle, Amazon is not giving us any sales numbers to look at. They've consistently claimed this is to protect competitive interests, which led journalists, and the public, the consistently believe that the figure must be kind of embarrassing. But with this exceedingly proud announcement, Amazon has revealed at least part of their reasoning: good PR. To proclaim that the Kindle has outsold every other product in the world (on Amazon!) makes it sound like the device is, at the very least, not a failure. Which it probably isn't! But let's look at what we really, honestly know: The Kindle outsold every other products in its parent company's online store, which has an exclusive on the device. We have no idea how many units are sold, nor do we have any idea how many Amazon expected to sell, or how many they'd need to sell for Kindle to be considered successful. We know that sales have gone up during a heavy shopping period, but that's about it. It's a closed system.

In other words, we know nothing new. Well, except that a certain other book store with a noticeably similar strategy and much hotter hardware is just about to show up piss-drunk at the Kindle's Christmas party, to try to steal its girlfriend. [Press Release]

Here's the rundown:

Kindle (Global Wireless) and Kindle (U.S. Wireless)

* Longer battery life for Kindle (Global Wireless): You can now read for up to 1 week on a single charge with wireless on. Turn wireless off and read for up to 2 weeks.
* Built-in PDF reader: Your Kindle can now display PDF documents without losing the formatting of the original file. Send PDF documents directly to your Kindle (via your @Kindle address) or drag and drop PDF files from your computer to your Kindle (when connected via USB). Learn more.
* Manual screen rotation: The Kindle screen can now manually rotate between portrait and landscape views so you can see the entire width of a web page or magnify the page of a PDF file. The page-turn buttons work the same in either orientation, and the 5-way controller movements are switched to match the orientation. Learn more.
* Option to convert PDF files to Kindle format. If you prefer to have your personal PDF documents converted to the Kindle format (so that they can reflow), type "Convert" in the subject of the e-mail when you submit your personal document to your @kindle.com address.

Kindle (U.S. Wireless) and Kindle (Global Wireless) users can go to Archived Items on their Kindle and download the Kindle User's Guide, 4th Ed., which now documents all the features of Kindle Software 2.3.

Kindle DX

* Better cropping of PDF files: In landscape orientation, white margins of PDF documents are automatically cropped to maximize the amount of content shown on the screen.
* Option to convert PDF files to Kindle format. If you prefer to have your personal PDF documents converted to the Kindle format (so that they can reflow), type "Convert" in the subject of the e-mail when you submit your personal document to your @kindle.com address.
* View pages longer: We've extended the time before Kindle DX switches into screensaver mode - from 5 minutes to 20 minutes - giving you more time for reviewing your content.

You should get the update automatically via your wireless connection, so you don't need to do anything special to get this stuff. [Amazon]

As many Kindle owners already know, keeping a large number of books on the device can get a bit unruly—so this would be a welcome update. It's also good news for people on the fence about whether or not to get a Kindle or a Nook over the holidays. It appears that the Kindle is going to be the only game in town until after the new year. [Kindle Facebook via Gadgetell]

As for the Mac version? We're still told that's coming soon. [Beta Download | Press Release]

Kindle For PC Features:
• Purchase, download and read hundreds of thousands of books available in the Kindle Store
• Read the beginning of any book for free before you buy
• Access your library of previously purchased Kindle books stored on Amazon's servers for free
• Read books in full color including children's books, cookbooks, travel books, textbooks and graphic novels
• Choose from more than 10 different font sizes and adjust words per line
• Add and automatically synchronize bookmarks and last page read
• View notes and highlights marked on Kindle, Kindle DX, iPhone, and iPod touch
• Zoom in and out of text with a pinch of the fingers (Windows 7 users only)
• Turn pages with a finger swipe (available in a future release for Windows 7 users)

Okay, so now we just saw the app running on an Acer tablet. Apparently it'll use an accelerometer to rotate pages, depending on the orientation of the tablet. It'll work on XP and Vista too.

Here's the full press release (thanks Dan!).

With Kindle for PC, readers can take advantage of the following features:

* Purchase, download, and read hundreds of thousands of books available in the Kindle Store
* Access their entire library of previously purchased Kindle books stored on Amazon's servers for free
* Choose from over 10 different font sizes and adjust words per line
* Add and automatically synchronize bookmarks and last page read
* View notes and highlights marked on Kindle and Kindle DX
* Zoom in and out of text with a pinch of the fingers (Windows 7 users only)
* Turn pages with a finger swipe (available in a future release for Windows 7 users)

Update: You can sign up here, to be notified when the download is ready.

The electronic paper displays used in the Amazon Kindle and Sony eReaders are made by Prime View. However, Taiwanese screen manufacturer AUO is hoping to get a slice of the reader pie by using rival and cheaper technology called SiPix. This technology coupled with its footing in flat-panel manufacturing, AUO hopes to lower the production cost of the components. They plan to produce a $150 device next year and then a $99 one in 2011.

AUO has already started shipping six to nine inch sized readers to a number of clients and is in talks with "nearly everyone you can think of." Hmm, Apple? [Financial Times via Electronista]

Yep, remember the kid who had his notes from George Orwell's 1984 deleted along with Amazon's mass eradication of the work from all Kindles? That little mofo just won in court, splitting a $150,000 settlement with a co-plaintiff and the law firm, which will be donating its portion to charity.

As much as this sounds like a Disney live action film from the 1990s (you can just see Jeff Bezos portrayed caricature-like by Paul Giamatti, can't you?), the real outcome is that Amazon no longer can just do what it wants to content on Kindles, just because it owns that content. According to the settlement:

Amazon will not remotely delete or modify such Works from Devices purchased and being used in the United States unless (a) the user consents to such deletion or modification; (b) the user requests a refund for the Work or otherwise fails to pay for the Work (e.g., if a credit or debit card issuer declines to remit payment); (c) a judicial or regulatory order requires such deletion or modification; or (d) deletion or modification is reasonably necessary to protect the consumer or the operation of a Device or network through which the Device communicates (e.g., to remove harmful code embedded within a copy of a Work downloaded to a Device).

TechFlash has more details and links to a ton of bonus legal mumbo jumbo, so check it out. [TechFlash]

This is a found photo from a Facebook album, without context, which leaves some nagging questions: Is it a Kindle, or a Kindle 2? (The coloration up top screams Kindle 2 to me, but it's blurry.) Did the couple know their nuptials would be blessed with the presence of His Holy Whispernet? Was the priest using the Kindle's text-to-speech function? Why not? [9Gag via MakeUseOf via Digg]

Read more about our Giz Gallery 09 here, follow @gizgallery on Twitter and see what else we'll be playing with at the event. And special thanks to Toyota's Prius — without their sponsorship, there would be no Gizmodo Gallery.

Aaaand we can't not do a proper sizemodo, naturally:

Slate's Farhad Manjoo points out more reasons (bothered from Harvard law professor Jonathan Zittrain) why we should be absolutely terrified of "tethered" devices like the Kindle, especially if we're headed toward a truly paperless and discless future, where books, movies and music are all downloaded. Imagine if there were no paper copies of 1984, and Amazon—or whatever company wins the ereader war—deleted it. Or any other book or film that's been banned at one point. It's much easier, after all, to delete them off of a million devices than to actually pull one thousand paper copies out of people's houses. A possibility that's more, uh, possible with breakthroughs like self-destructing data. (One more reason we'll always need something like BitTorent, more than ever in the future, not less.)

If hypotheticals aren't your thing, take the 2004 TiVo vs. Echostar patent infringement case. When TiVo won, the judge ruled that Dish didn't just have to stop selling infringing DVR boxes, they had to actually remotely kill the boxes they'd already sold. Boxes they had installed in people's houses.

Granted, Jonathan Zittrain is the same crazy guy who says that the iPhone is killing the internet, but you know, this time he actually seems kinda right! I hope he's still just crazy though. [Slate]

I am certain this gave Amazon honcho Jeff Bezos one hell of a tingle when he saw the report, but in spite of the repeated mentions of Amazon and Kindle, I'm pretty sure he had very little to do with it himself. Here's why:

The DLC—'scuse me, NDLC—estimates the up-front cost of materials to be around $200, but could fall to $80 by 2012. Since the government now spends about $109 per student on text books, the initial investment seems in line. However, I don't think they're looking at the appropriate model. The Kindle 2's teardown revealed that it costs around $185, but that includes $60 for the 6" screen. Don't these fat cats in Washington know that textbooks only work on the $489 DX (and even then just barely)? Even at cost, I guarantee you're looking at a lot more than $200 per kid for one with a 10" screen.

And don't even get me started on the subject of smashed Kindle screens.

Doing the math here, my numbers are a lot higher than the DLC's, and furthermore my estimates on E-Ink's future price drop are way more pessimistic. Especially since the jury (meaning us) is still out on the longevity of E-Ink as an ideal screen technology, and only volume will really drive down the price. Wait a few years, see what happens with LCD, with laptops and netbooks, with iPhones and other smartphone platforms, and then, just maybe, you'll be able to select a decent product to subsidize 56 million times over.

Oh, and dudes, don't go creating terms like eTextbook—we already have lingo for this stuff, and you sound like you just arrived in a time machine from 1996. [DLC via New York Times]

Basically, the way Kindle and the Kindle iPhone app are set up today, users have no idea how many times they can download a book, nor can they easily know how many devices can be used to read said book.

Making the situation even more confusing is the fact that the DRM information actually varies by publisher, and to find out how many times they will allow you to download a book you have to visit the legalese. Sometimes the info isn't there, either. The worst part is this was all confirmed by an Amazon tech support person:

"How I find out (sic) how many times I can download any given book?" I asked. He replied, "I don't think you can. That's entirely up to the publisher and I don't think we always know."

I pressed - "You mean when you go to buy the book it doesn't say ‘this book can be downloaded this number of times' even though that limitation is there?" To which he replied, "No, I'm very sorry it doesn't."

As the author notes, this isn't so bad if you're buying a beach book or something you'll read once and be done with it. Where it does get shitty is with reference books, which the author would like to read today, on his iPhone 3GS, and perhaps in a year, on the theoretical iPhone 4G, powered by unicorn tears. With certain books, you could be limited in such a way that your reading material does not follow your gadget's natural upgrade cycle.

At the very least Amazon should update its policy so this info is out in the open and easily accessible. The best case scenario would be to allow consumers to actually, you know, literally own the books they've just bought. [Gear Diary]

Right now, blog monthly subscriptions are $2. Of that 70% will go to Amazon and 30% will go to you, which—knowing that people can read RSS in computers and cellphones—will probably result in $0 for Amazon and $0 for you.

Made of wood to prove some sort of point that we totally get, but because we understand it so well, we'd feel embarrassed explaining, the Amazon Kindling is the only wooden, wireless reading device on eBay today. Sure, a paper book might hold more pages, but paper makes for a short-lived campfire...though secondhand Danielle Steel paperbacks are probably in better supply these days than actual trees. [eBay and Evil Mad Scientist and cockeyed via Treehugger]

The Kindle's voice feature works like any other, so pronunciation foibles are expected, and even predictable. Says the developer Nuance, the technology licensed by Amazon:

It's not even considered a bug. If it encounters a word it has never seen, it approaches it almost like a kid, phonetically.

But for the speech feature to be useful in a newspaper context, as Amazon wishes it to be, its library will have to be constantly updated—over the air, presumably—with pronunciation overrides for whatever weird names or places are in the news at a given time.

Of course, this would be extremely unwieldy and only marginally effective, so Amazon probably won't do it. Good luck with today's leading NYT story, Kindle owners. You might even have to read it. [NYT]