The New Fire Spreads
hemant is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Amazon (NASDAQ: AMZN) recently unveiled a new line of its Kindle devices with new design and it is boasting with loads of digital content. All of this comes at a much reasonable price as compared to Apple’s (NASDAQ: AAPL) iPad. Amazon hopes to gain a fair bit of share in the booming tablet market with its new products and services.
Amazon launched the Kindle Fire HD tablets with 16GB and 32GB variants. The premium Kindle Fire HD has a 8.9inch (1920X1200) screen which is slightly smaller as compared to an iPad. Kindle Fire HD has dual stereo speakers with Dolby Digital plus which is a first in the tablet market. Other features include ‘Immersion Reading' which allows you to read a book while hearing narration from a famous actor and “Whisper Sync Voice” giving users an option to sync between the audio book and the text version of its e-book. Amazon has added a system that can control how much time a child can spend on various media. So, parents can now have control on how much their kids spent time on watching video and playing games, but let them read as much as they want.
As far as pricing is concerned the 16GB Fire HD costs $299 and a 32GB 4G version will cost $499. The 64GB will cost around $599 which is far less as compared to the top end iPad which costs $829. Also the one year cost for Kindle Fire HD is $549, while for the iPad it is $959.
Amazon also launched a new black & white e-reader known as Kindle Paperwhite. It offers more brightness and contrast for comfortable reading in the dark. The Paperwhite technology is highly energy efficient as it gives the new e-reader a battery life of almost 8 weeks. The device also calculates users reading speeds and it can predict the estimated time a user will take to finish a chapter or the complete book. The price range starts at $119 whereas a 3G model that will cost $179. The 7-inch tablets will start shipping on September 14, 2012 while the 8.9 inch model will begin shipping on November 20, 2012.
The Kindle Fire tablets are set to give stiff competition to the iPad which has 73.4% share of the tablet market. Amazon claims that the Kindle Fire currently represents about 22 percent of the entire tablet market in the United States. Amazon started off as an online bookstore and is now the largest internet retailer in the world. The new Kindle Fire tablets post adverts on their home screen and lock screens and there is no way to disable it. Earlier, there was an option to opt-out of the ads either by paying up front for an ad-free device or paying to remove ads after the purchase was made.
Apple makes as much as a 51 percent profit margin for each iPad sold. While Amazon has been selling tablets at negligible profit margins hoping that it can cover up for the same through its online digital content including apps, e-books, movies subscription and last but not the least advertising. The new Kindle Fire tablets have come with a bag full of features and services but can this strengthen Amazon’s share in the tablet market? Only time will tell so!
hemantnagla has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple and Amazon.com. Motley Fool newsletter services recommend Amazon.com and Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.
