AT&T sponsors Kindle 3G, price drops to $139

AT&T said Wednesday that it will advertise on the Kindle 3G to allow Amazon to lower the cost on the ad supported model another 15 percent. The 'Kindle with Special Offers' with 3G access previously cost $164; it will now cost $139.

The move is a win for AT&T, who has provided the 3G data for the Kindle since its launch back in 2009. Terms of the deal were not disclosed. Amazon covers the cost of providing data to its Kindle customers, unlike tablet devices where the user is responsible for those charges.

"Kindle 3G is by far the fastest-growing connected device on the AT&T network," AT&T Mobility president and CEO Ralph de la Vega said in a statement.

Amazon first offered Kindle e-readers with advertising back in April, when it sold the Wi-Fi version of the Kindle for $114, a $25 discount. The ads appear when the device is turned off as a screensaver and also on the device's home page.

Consumers have responded positively to the offering: Amazon reported in May that the ad supported Wi-Fi model was outselling all the ad free devices. The success prompted the e-retailer to sell the 3G model with ads as well: it has been doing so since late May.

For whatever reason, getting ads on the 3G device has been a winner for Amazon. CEO Jeff Bezos said in a statement that his company found on average the 3G user clicks on more advertisements, and also reads about 20 percent more books.

Several high-profile brands are now advertising on the Kindle, including Buick, Olay, and Chase. The participation has helped Amazon lower its price to a level that can not be touched by any of its major competitors.