To date most tablet manufacturers have had two main routes: price it high and take on Apple, or price it low and take on the Android-dominated bargain market. With a flurry of announcements this week, Amazon is clearly going for both.The existing seven inch Kindle Fire is getting a price cut from $199 to $160. The significance there is that it’s now significantly undercutting Google’s Nexus 7 and is thus the cheapest option for people who want a trusted brand name tablet rather than risk cutting corners on performance of usability.
Meanwhile there’s a new range of “HD” Fires with a bunch of new features beyond higher screen resolution such as a “drastically” improved processor, better wireless reception a camera, Kindle style syncing between e-Books and their audio versions, and an “X-Ray” feature that recognizes actors in a video and provides relevant links to sources such as IMDB. As is often the case with tablets, it may be a very personal decision as to which features really make a difference.
The 7 inch HD is at the familiar $199 price point, with a new 8.9 inch version at an iPad-busting $399, both models having
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16GB of storage. There’s also a $499 model that has 32GB and supports LTE 4G speeds.
To top that off, Amazon is offering an LTE data plan for just $50 a year. That led Amazon boss Jeff Bozos to boast that the tablet/data plan combination will save $400 in the first year compared to an iPad.
However, the Amazon data plan is only for 250 MB a month. If you are getting, for example, 10Mbps on LTE you’ll be enjoying those fast speeds for all of three and a half minutes each month. Put another way, you’re effectively paying more than $70 an hour for the high-speed access.
Bezos didn’t directly address whether any of these devices are being sold at break-even or even below cost price. (It’s almost impossible to believe the reduced-price original Fire isn’t a loss-leader.) However, he did hint at such economics by pointing out that “we want to make money when people use our devices, not when they buy are devices.”
To top that off, Amazon is offering an LTE data plan for just $50 a year. That led Amazon boss Jeff Bozos to boast that the tablet/data plan combination will save $400 in the first year compared to an iPad.
However, the Amazon data plan is only for 250 MB a month. If you are getting, for example, 10Mbps on LTE you’ll be enjoying those fast speeds for all of three and a half minutes each month. Put another way, you’re effectively paying more than $70 an hour for the high-speed access.
Bezos didn’t directly address whether any of these devices are being sold at break-even or even below cost price. (It’s almost impossible to believe the reduced-price original Fire isn’t a loss-leader.) However, he did hint at such economics by pointing out that “we want to make money when people use our devices, not when they buy are devices.”
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