Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Amazon offers cheaper Kindle -- with ads

amazon_kindle.top.jpg By Julianne Pepitone, staff reporter


NEW YORK (CNNMoney) -- Would you buy a Kindle with on-screen ads in order to knock $25 off the price? Amazon hopes so.

The company announced its new "Kindle with Special Offers" on Monday, which will begin shipping May 3. Pre-ordering is available immediately.

The ad-festooned Kindle will sell for $114, which is $25 less than its ad-free counterpart, Amazon's $139 Kindle Wi-Fi. The Kindle 3G is available for $189.

The Kindle's "special offers" and ads will appear on the e-reader's screensaver and at the bottom of its home screen. Amazon plans to mix together advertisements from launch sponsors including Buick, Olay and Visa with daily-deal style discount coupons.

Some of the discounts Amazon plans to offer in the initial weeks include a $20 Amazon gift card for $10 (a deal that was a monster hit when Amazon offered it earlier this year through LivingSocial), plus discounts on Amazon MP3 albums, Audible books and Kindle bestsellers.

Amazon (AMZN, Fortune 500) is also introducing an app called AdMash, which will let customers vote on potential future sponsored screensavers.

Amazon has never revealed sales figures for the Kindle. Price cuts late last year brought the most basic version down to $139, and Kindle apps are now available for a wide variety of devices -- including the iPhone, iPad as well as BlackBerry and Android phones.

But the Kindle seems to be doing well despite competition from e-readers including the Barnes & Noble (BKS, Fortune 500) Nook, the Sony (SNE) Reader and Kobo from Borders (BGP), as well as Apple's (AAPL, Fortune 500) multipurpose iPad.

Analysts expect the e-reader market to really catch fire when the price tag for the device drops below $100. Amazon implied that it's trying to get there.

"We're working hard to make sure that anyone who wants a Kindle can afford one," Amazon CEO Jeff Bezos said in a prepared statement.  To top of page

Index Last Change % Change
Dow 18,570.85 53.62 0.29%
Nasdaq 5,100.16 26.26 0.52%
S&P 500 2,175.03 9.86 0.46%
Treasuries 1.57 0.00 0.32%
Data as of 7:13pm ET
Company Price Change % Change
Chesapeake Energy Co... 5.39 0.42 8.45%
General Electric Co 32.06 -0.53 -1.63%
Bank of America Corp... 14.38 0.11 0.77%
Southwestern Energy ... 14.47 1.26 9.54%
PayPal Holdings Inc 37.42 -2.71 -6.75%
Data as of Jul 22
Sponsors

Sections

HSBC banker arrested at JFK airport as he prepared to leave the country. He and former trader face federal charges they manipulated currency trades. More

With one exception, every vice presidential candidate in the past 40 years has released a tax return. Given that Donald Trump hasn't released his tax returns, will Mike Pence be the second exception? More

Verizon has agreed to pay $4.8 billion or $5 billion for Yahoo, according to multiple published reports. More