When Amazon introduced its Kindle Fire, some were quick to declare that a war would exist between Apple and Amazon. Some even spent their time writing about how bad the Amazon Kindle was compared to an Apple iPad, missing the entire differences between the two devices. This headline grabbing stunt soon changed to the traditional 10 worst things about this and 10 best things about that, with little regard as to what separated these two devices.
Apple has admitted that it does not fear the Amazon Kindle Fire and actually believes the device could help the iPad sell more units. The thinking is that devices like the Kindle Fire and Nook tablet could introduce more people to tablets and encourage those new tablet owners to upgrade to an Apple iPad. The speculation that Apple may build a smaller 7″ tablet may not come to fruition, since Apple’s philosophy is to not fear the new, cheaper tablets. Kudos to Apple for its rational approach to the situation and dispelling the notation that there is a war between the tablets.
Where some failed to see Amazon’s real goals is where Amazon will excel. Amazon had no intention of ever competing against the Apple iPad. Amazon’s strategy was to eliminate the other wannabes like HP, Dell, RIM, and any other technology company that was in the Android tablet business. The strategy seems to be working well as Dell has announced the elimination of its Streak tablet computer.
Next is the misconception by some that a 7″ tablet would not attract an audience. Actually, a 7″ tablet is a perfect size for some of us. It is what I call a ‘tweener. It is in between a phone and an iPad. Also, Amazon can afford to subsidize the sale of its Kindle Fire and take about a $2 loss per sale for each unit sold. Amazon will make up for this loss when people opt-in to buy more applications, rent movies, or subscribe to a Prime account. No other company in the Android tablet market has this resource of offerings to fall back on.
HP has announced that it will re-enter the tablet market when Microsoft releases Windows 8. This combination of a tablet with Windows will attract those who need to stay in the Microsoft realm for options such as Office. But will this be enough to attract buyers at a premium price? We will see sometime in late 2012 or maybe early 2013 whether this will work for HP and Microsoft.