SAN FRANCISCO,  USA: Shares of Amazon.com Inc rose as high as 4 percent on Wednesday after the global online retailer announced it would launch its popular Kindle electronic reader overseas and cut the price of its U.S. Kindle in advance of the holidays.

Amazon's move comes as a host of device makers and media companies from Sony Corp  to News Corp  and Time Warner Inc  seek a toehold in the market.

Amazon's electronic reader will be available in more than 100 countries, and the wireless coverage from AT&T Inc  for the $279 device will work in additional countries, such as China.

Analysts said the Kindle's U.S. price cut and expansion overseas should boost revenue from the device and digital book sales and help Amazon hold its lead in the electronic reader market.

"Amazon has first mover advantage in the United States and they'd like to enjoy that abroad as well," said digital media analyst Loren Johnson at market research consultancy Frost & Sullivan.

The company will also cut the price of its U.S. Kindle by $40 to $259, as volume increases have offset manufacturing costs. Only a year ago, the device cost $359.

"Amazon is seeing this as a much more competitive space," said Johnson, adding that the company's massive reader base still gives it a prime advantage that will secure its market leader position "for a long time."

Citibank on Wednesday raised its 2009 Kindle-related revenue estimates to $700 million from an earlier estimate of $550 million. It raised its 2010 revenue forecast for the device and related products to $1.5 billion from $1.25 billion.

The price cut, argued analyst Mark Mahaney, comes earlier than expected and comes before Amazon has a true competitor.

"This price cut increases the chance that the Kindle becomes one of the hit products this holiday season," wrote Mahaney in a note.

JPMorgan said the international launch could significantly boost the company's profit, which JPMorgan estimates will be $2.07 per share in 2010.

"Even at 6 million devices, EPS impact is huge," wrote analyst Imran Khan. "We estimate that 6 million Kindle users, buying one book and a subscription a month, could drive approximately $0.40 in annual EPS impact for Amazon."

Amazon does not disclose revenue or profit data related to the Kindle.

Shares of Amazon rose 3.2 percent, or $2.95, to $93.86 in early afternoon trade on the Nasdaq after rising as high as 3.9 percent. Shares are up 73 percent since the start of the year, as of Tuesday's closing price.