Answer to Question #30256 in Other Economics for nhatnguyen tran
Even though the Kindle's key innovation — its electronic ink — was invented and is being made, at least for now, in the U.S., Asian manufacturers are capturing the vast majority of the value added by manufacturing the e-reader itself. Even more worrisome, the U.S. is almost certain to lose control of the e-paper display technology and the future innovations that spring from it.
Amazon designed the Kindle in California and one of its key components, its "ink" (the tiny microcapsule beads used in its electrophoretic display), were designed and are being manufactured by E Ink, a company based in Cambridge, Massachusetts. But the majority of the value added in manufacturing the rest of the unit is being captured in Asia.
The market research firm iSuppli estimates that the Kindle's total manufacturing cost is $185. The most expensive single component is the $60 display, which Taiwan's Prime View International is manufacturing. The display consists of E Ink's special beads and a sheet of glass that has a patterned layer of silicon transistors on it that turn the beads black or white when a voltage is applied.
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