Amazon unveils larger, cheaper Kindle Fires

Internet retailer takes on Apple with aggressive pricing move

Updated 09:24 AM Sep 07, 2012

 

The new 8.9-inch Kindle Fire HD works off either Wi-Fi or 4G. REUTERS

SANTA MONICA - Amazon.com unveiled larger Kindle Fire tablets yesterday, challenging Apple's dominant iPad with lower prices and a trove of digital content that Amazon hopes will win it a bigger share of the booming tablet market.

The world's largest Internet retailer lifted the lid on devices with price tags ranging from US$159 (S$198) to $599. The new tablets come with ads known as "special offers" that appear when screens are locked and in the corner of the home screen, helping Amazon keep prices low.

Last year, Amazon debuted a 7-inch tablet at roughly half the price of the US$499 iPad. In just 10 months, it became the No 2 tablet in the United States, after the iPad.

Amazon's expanding line-up also intensifies a battle with Google and Microsoft, who this year entered their own competitors in the booming tablet arena.

The latest aggressive pricing move, and Amazon's variety of gadgets, furthers its goal of getting Kindle tablets into the hands of as many buyers of its online content - from games and books to video - as possible.

Apple, by contrast, makes much of its profit from hardware sales. It sells a single-sized iPad often touted as best-in-breed, at costs ranging from US$399 to US$829, depending on storage capacity, screen resolution and wireless connectivity.

Amazon will begin shipping on Nov 20 an 8.9-inch version with a high-definition screen, that works off either Wi-Fi or fourth-generation wireless broadband, known as 4G. The costliest version, at US$599 for 64 gigabytes of storage, undercuts the top-of-the-line US$829 iPad.

"Their first Kindle Fire tablet was a device that said 'See, we can tie all this together', but it wasn't a strong enough device," said Forrester Research analyst James McQuivey.

"Now they've really come ready to show that their device line-up is going to be as good as their service line-up.

"They're tying those two things together, and at a price that is very, very hard to compete with. It's going to push everybody's else's price buttons - including Apple's."

The premium Kindle Fire HD has a 1920-by-1200 resolution screen, lagging Apple's so-called "retina" display. At 8.9 inches, it is also slightly smaller than the iPad's screen.

At the other end of the spectrum, the cheapest 7-inch WiFi-only Fire goes for US$159. Apple's lowest iPad price tag is US$499.

"Amazon is able to sell these products at or close to cost, while Apple has 40 to 50 per cent gross profit margins and has always been very cautious with their product margins," said Mr Scott Tilghman, an analyst at Caris & Company. "As Amazon is able to upgrade their products and have competitive hardware it may become more worrisome for Apple."

Amazon also showed a comparison of the Kindle Fire HD 32GB 4G tablet versus the iPad 3 wireless device on a big screen at the Santa Monica event. The purchase price, plus the data plan, came to a one-year cost of US$549 for the Amazon tablet and US$959 for the iPad.

The new Kindle Fire HD tablets come with a front-facing camera, paired with a customised, pre-installed application from Skype that allows users to video chat for free, Amazon said.

It also unveiled several new services to support the tablets, such as X-Ray for movies and Kindle FreeTime.

X-Ray allows users to look up information on actors in scenes without leaving the flick. FreeTime is a new parental control system that lets parents set limits on how their kids use the tablets. REUTERS

 Source: www.todayonline.com