By Rachel Metz -- AP Technology Writer
NEW YORK (AP) — Amazon.com Inc. cut the price of its Kindle electronic reading device to $299 on Wednesday in an effort to attract more bookworms and make the gadget a mainstream hit.
The new price is $60 below the tag the Kindle has had since May 2008. The product originally debuted at $399 in 2007.
Amazon spokeswoman Cinthia Portugal said the price cut, a classic move in electronics marketing, is not just a short-term promotion.
"We've been able to increase the volume of Kindles we're manufacturing and decrease the cost of doing so," Portugal said.
Amazon has not disclosed Kindle sales figures, and the publishing industry has said e-books account for less than 1 percent of book sales. But it is a fast-growing, competitive segment. Customers can wirelessly download books to the Kindle, with new releases often as inexpensive as $10.
ThinkEquity analyst Ed Weller was surprised that Amazon cut the Kindle's price so soon after February's introduction of the latest model of the device. He said $299 "feels like a much hotter price" than $359.
"They'll sell more of them, and they'll sell more books," he said. He doesn't expect Amazon to follow the Kindle price cut by raising digital book prices.
Amazon's larger Kindle DX, which was released this spring and geared toward textbooks and periodicals, still has its original price of $489.
Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.