Amazon Kindle Fire: A $199 Kindle Tablet
by Jason Inofuentes on September 28, 2011 9:54 AM ESTKindle Touch and New Kindle
No one announces just one product at an event these days, and Amazon is no different. Along with the Kindle Fire, Amazon saw fit to refresh their line of e-readers. E-reader enthusiasts, you know who you are, will recognize the technology behind the new Kindle Touch from the likes of the new Nook and the Kobo. The IR sensor laden e-ink display allows touch inputs to be received and elicit page turns and other UI interactions. Now devoid of many of its buttons, including the full QWERTY keyboard of its predecessors, the Kindle Touch is smaller than the Kindle 3 and comes at a new price point, $99. For that you get the WiFi model which promises faster page refreshes and so on. Free global wireless internet for life is the promise of the 3G variant, which at just a $50 premium makes it a terribly good bargain.
Also joining the keyboardless clan is the new Kindle. This device shares the new e-ink panel with the Touch, but makes do with a hand full of navigation buttons in lieu of the touch screen. The device is significantly lighter and smaller than its predecessor, no doubt owing much to the loss of the keyboard, and brings the e-reader market to a new price target at just $79. The new Kindle will be offered in WiFi only guise, so bibiliphilic globetrotters will have to make do with the Kindle Touch 3G. Amazon also saw fit to unite its AmazonLocal deals service with the Special Offers that graced the last generation of Kindles. The new ads will be displayed as screensavers on the entire e-ink line and are promised to maintain a certain aesthetic so that a buyer would hardly notice that it's not just a pretty screensaver.
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Wrap-up
Leading up to the announcement, I expected that Amazon would leverage its media offerings to make a tablet that could compete with Apple on content. Beyond that I had no idea what would be in store. It comes as little suprise though that Amazon saw fit to completely obfuscate the Android platform beneath a UI that steers the argument decidedly in favor of the tablet as media consumptive device. Based on these first looks, the UI is elegant and friendly, and the hardware is sufficient enough to provide a good media experience. And at $199, no other tablet offers as compelling a combination of services, content and value. We can't wait to get our hands on the Kindle Fire and discover whether Amazon has set the tablet market ablaze, or simply joined the other kindling.
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quiksilvr - Wednesday, September 28, 2011 - link
*Starts digging grave*Seriously, how can they compete with this now?
lurker22 - Wednesday, September 28, 2011 - link
Well, lower their price as a starter...Spazweasel - Wednesday, September 28, 2011 - link
"We're losing money with each unit, but we'll make up for it with volume."Most phones and pads, when you take into account the need to recover R&D costs (which can run into the hundreds of millions, or even billions of dollars), are selling with almost no margin or profit. The sellers are depending upon their portion of the app/book/media sales through their so-called "walled gardens" to sustain the business. But if nobody buys content through the producer's store... if everything is sideloaded or pirated... there is no profit to be made, and so the company stops making the phone/pad.
I would be very surprised if Amazon will make even a single penny on the Fire hardware sales.
Spazweasel - Wednesday, September 28, 2011 - link
Stupid no-edit.B&N is in worse shape financially than Amazon; they can't afford to have a Playbook Moment. They could sink a lot of money into subsidizing the Nook by selling below-cost, and it's a huge risk. Amazon can afford that; I don't think B&N can.
SilthDraeth - Wednesday, September 28, 2011 - link
Your assessment is a good one. However, I don't really believe Amazon is expecting people to buy to much media with these devices. Sure they want you to consume media. But ultimately, the device will lead to more overall sales of products through Amazon directly.As it is, when I am in a store, I look up the product on Amazon, to read user reviews, and check prices. If reviews are bad, I look for an alternative that gets good reviews. Check prices in store, if the product is available.
9 times out of 10, Amazon is the better deal.
I think getting more of these tablets into hands of consumers will grow their business even more.
Zoomer - Sunday, October 2, 2011 - link
You just have to remember that it's wifi only.DanD85 - Wednesday, September 28, 2011 - link
Your argument of "millions, or even billions of dollars R&D costs" hold no ground! Why? Because the Fire is just a product from an ODM, Amazon only buy from that ODM and with their buying power I don't believe they have to sustain any hardware loss on this.Secondly, with the release of the Xiaomi phone with the roughly the same performance with the galaxy tab 2 but half the price prove that WE, the consumer simply "believe" the cost of the product is what the manufacturer say without knowing anything better.
Guspaz - Wednesday, September 28, 2011 - link
Sure, but Amazon is the first tablet vendor other than Apple with a comprehensive set of first-party services behind it. They've got their appstore, their music store, their TV and movie services, their book store, their cloud syncing, all of it. None of the other tablet offerings have that all as first-party services under the same roof except Apple.JasonInofuentes - Wednesday, September 28, 2011 - link
I would be surprised if Quanta would sell for much less than $200, certainly not enough for Amazon to have any appreciable margin on the Fire. Xiaomi is an interesting case of an Asian company using its home team advantage to bring costs down considerably. But it probably doesn't have the margins that Samsung has, let alone Apple. The key is what the market will pay for a device. Apple as mastered the art of finding a price point and owning it. The iPad is obviously a good example of this, but consider too the MacBook Pro 15. Most people would have trouble paying $1500 for a 15" Windows laptop, because decent models can be had for half that. Yet MBP15 sales have been rock solid for years. $750 is about what a person will consider spending on a Windows laptop, but $1500 is easily considered for a Mac.But no one is immune from price disruptions. And if the Fire does rise to the top of the Android heap, it may be enough to shake down Apple's pricing.
geedavey - Wednesday, October 5, 2011 - link
I read yesterday that the $199 Fire costs $209 to make.