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Amazon Fires Up Low-Cost Tablet Market

Amazon.com Inc. (Nasdaq: AMZN)’s new Android tablet, the Kindle Fire, is being heralded as the first true iPad competitor, a distinction other tablets have had but quickly lost. But the Fire just might merit the lofty label thanks to its specs and $199 price tag.

“Amazon just changed the tablet game. Mark down the day on your calendar,” The Verge Editor Joshua Topolsky tweeted during the tablet’s unveiling Wednesday.

At only $199, Amazon’s tablet is $300 less than Apple Inc. (Nasdaq: AAPL)’s cheapest option, although it lacks a camera, mic and 3G access. The device runs a modified version of Android Gingerbread, includes 8GB of memory, supports side-loaded Android apps and includes free cloud storage for its library of media, books and video. It also has a cloud-based Web browser, dubbed Amazon Silk, that predicts a user’s search query as it's being entered. (See Android Cheat Sheet: How to Beat the iPad 2 and Tablet Wars: iPad 2 vs Android 3.0.)

Amazon also introduced a smaller touch-screen version of the Kindle for $99 and a 3G option for $149 on AT&T Inc. (NYSE: T), as well as dropping prices on the older Kindle to $79. The Fire will ship on Nov. 15.

They say
Reactions from live blogs and Twitter streams were largely positive during Amazon’s unveiling. Ovum Ltd. analyst Jan Dawson called the Fire really well thought through, noting that the “Kindle Fire is so much better than any Android tablet in terms of wrapping a broad ecosystem around it.”

It's not just the ecosystem, but also how it's integrated, according to Informa Telecoms & Media analyst David McQueen. He says that the Fire's cloud services could be the real game-changer in the tablet market, drawing more new users to the cloud. (See There's a Niche in the Mobile Cloud.)

“Amazon will finally prove to the world that size doesn’t matter but value for money does, which will be a big lesson for RIM with its Playbook and for other players who have already tried to launch tablets with 7" [inches] or less,” McQueen adds in a research note.

McQueen wasn’t the only one to draw comparisons to BlackBerry ’s PlayBook. Engadget says that the hardware is similar, less a few physical inputs, but that the "software performance seems quite smart at this point."

Some, like NPD Group Inc. analyst Ross Rubin also believe that the smart services integration on the tablet suggest that Amazon could tackle the phone space next.

We say
For the wireless operators, an important differentiator for tablets will be including Long Term Evolution (LTE) for connectivity, but there will always be a lot of consumers for which Wi-Fi will be enough. These consumers also aren’t likely willing to fork over $700 for an LTE tablet either. (See AT&T's First LTE Tab Is for Big Spenders.)

Amazon’s Fire appears to have all the right specs to tap into a growing market of consumers who want a feature-packed tablet without a hefty price tag or monthly commitment. (See Lessons From the $99 HP Tablet Rush.)

Read up on the highs and lows of the tablet market below.

— Sarah Reedy, Senior Reporter, Light Reading Mobile

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sarahthomas1011 12/5/2012 | 4:52:26 PM
re: Amazon Fires Up Low-Cost Tablet Market

I don't think the lack of 3G will be a detterent for the demographic Android is targeting, which is slightly different than the iPad's. There's a big market for value tablet seekers though, and I think this tablet has a great shot at attracting it.

paolo.franzoi 12/5/2012 | 4:52:25 PM
re: Amazon Fires Up Low-Cost Tablet Market


I think the big thing beyond the tablet bit is Silk.  All I can say is that if they can pull that off for real is....WOW.


PS - The big deal to me is that (especially if they extend it to Android) a very sneaky way of having people wanting to host on EC2.



DCITDave 12/5/2012 | 4:52:25 PM
re: Amazon Fires Up Low-Cost Tablet Market

Our first quote choice could not have been more generic, cap-on-backwards, dumb frat guy-sounding. On behalf of the writer and editor of this story, I'm sorry we weren't more careful.

sarahthomas1011 12/5/2012 | 4:52:24 PM
re: Amazon Fires Up Low-Cost Tablet Market

I agree.  It's pretty innovative (although many point out Opera has a Turbo functionality that's similar). Amazon has posted a video on it here: http://amazonsilk.wordpress.com/2011/09/28/introducing-amazon-silk/

sarahthomas1011 12/5/2012 | 4:52:24 PM
re: Amazon Fires Up Low-Cost Tablet Market

Sorry for being fratastic, but it does capture what most at the event were saying. There's a lot of excitement around the Fire.


DCITDave 12/5/2012 | 4:52:23 PM
re: Amazon Fires Up Low-Cost Tablet Market

sev's point is interesting, though. by having a browser and device and cloud service all working together, Amazon has done a lot of what Apple is looking to accomplish with iCloud (and what it did accomplish with MobileMe). 

lock those consumers in any way you can.

DCITDave 12/5/2012 | 4:52:23 PM
re: Amazon Fires Up Low-Cost Tablet Market

I know. I just crushed a beer can on my head when I read the spec sheet.

voipuberalles 12/5/2012 | 4:52:22 PM
re: Amazon Fires Up Low-Cost Tablet Market

Phil, as I see it the Silk distributed browser architecture takes Amazon way beyond iCloud storage serices.  It allows Amazon to offer good web performance for a low cost mobile device.  This enhanced Silk browser performance can change the app paradyme from native App Store downloads to web/cloud based apps.  Amazon uses one of its key strategic assets, its cloud infrastructure, to improve the user experience and open up a whole new ecosystem.  In the process, Amazon is right in the middle of everything the user does.  Just brilliant!

Anne Morris 12/5/2012 | 4:52:21 PM
re: Amazon Fires Up Low-Cost Tablet Market

Any idea when the new Kindles are planned for Europe? As far as I can see they have just talked about US plans.

somedumbPM 12/5/2012 | 4:52:17 PM
re: Amazon Fires Up Low-Cost Tablet Market

I was really hoping for a color e-ink something -existing Kindle services would have sufficed.

Those dreams squashed I bought an Android tablet today that suits my current needs.  I will watch how Fire/Silk develops because of my technical interests, but as a user neither have anything I desire.

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