Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Amazon's Kindle Fire HD Is a Menace to Android and a Friend to the iPad


Amazon's new Kindle Fire HD is about to shake up the tablet market.

The bigger Kindle Fire HD with an 8.9-inch screen and 32 GB of memory is just $299. The cheapest iPad and Galaxy Note models are $499 and have half the memory!

Plus, the 32 GB 8.9-inch Kindle Fire HD with 4G/LE wireless is just $499, while the basic 4G iPad is $629 and again, has half the storage space.

This is a new paradigm in tablet pricing -- Amazon is now the Wal-Mart (WMT) of the industry!

And why would they do this?

Well, it's simple.

Amazon is vertically integrated, and the Kindle product line (both the e-readers and the tablets) is not a profit center in and of itself -- the devices are designed to push Amazon's digital content offerings and its overall storefront.

Think about it.

The Kindle Fire line runs a highly-customized version of Android and this is a big, big problem for Android.


First and foremost, it gets people used to using Amazon's customized interface instead of Android itself. Why do so many people still use Windows? Because they're used to it.

Secondly, the devices funnel end users not to the Google Play store, but to Amazon itself.

From a broader industry perspective, Amazon's bargain-basement pricing lowers the floor for what people can expect to pay for a high-quality, well-spec'd tablet. This is awful for companies like Samsung trying to make a buck on a tablet in the $199 to $249 price range. And it makes things really tough for Microsoft (MSFT), which doesn't even have a horse in the running yet.

Apple might lose a few customers at the margins. But on average, the type of person who is willing to shell out $499 for an iPad isn't price shopping. iPad buyers are paying for stunning design, ease-of-use, easy integration with other Apple products, and sexy branding.
Position in AAPL
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Featured Videos