Editorial: Kindle Fire is Amazon’s iPad at iPod touch Pricing | iLounge Article

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Editorial: Kindle Fire is Amazon’s iPad at iPod touch Pricing

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By Jeremy Horwitz

Editor-in-Chief, iLounge
Published: Wednesday, September 28, 2011
Articles Categories: Editorials

Though iPods, iPhones, and iPads have become exceptionally popular with consumers over the past 10 years, Apple has repeatedly been accused of leaving some prospective customers’ needs unfulfilled. Until today, we found that accusation somewhat hard to take seriously. Apple was clearly chasing mainstream users seeking simple, elegant solutions, while its rivals went after two different crowds: spec-focused early adopters and ultra-budget-conscious customers. Critics be damned, Apple’s strategy worked wonders, giving the once struggling company a 70% market share for the iPod and a reported 80% market share for the iPad, with a lower but still significant share of the comparatively huge smartphone market. It has become obvious—conventional wisdom, even—that competitors would need much better products or prices in order to challenge Apple’s devices.

Amazon’s just-announced $199 Kindle Fire appears to be the right product at the right price—a rival to both the iPad and the iPod touch, priced lower than either of them. Unlike Apple, which has suggested that its iPods and iPads need separate interfaces for different 3.5” and 9.7” screen experiences, Amazon’s 7” display splits the difference and sits in the middle, appealing to people who want a media player, reading device, and web browser that’s bigger than the iPod but smaller than the iPad. We’ve believed for years that such a device was worth producing, but Apple has gone out of its way to suggest otherwise, calling 7” devices “tweeners” and claiming that they won’t satisfy customers.

Regardless of whether Apple’s found the 7” form factor problematic, Amazon seems to have figured out exactly how to make it work—by streamlining its interface even further than the increasingly complex iPad and iPod touch, stripping out features and thereby the need for additional apps to make use of them. It’s essentially what the iPod touch would have been if Apple had focused largely on polishing its media playback capabilities, rather than transforming it into a miniature computer, or “training wheels for the iPhone,” as Apple once put it. Kindle Fire is focused on video, music, magazines, books, and web browsing functionality, with secondary support for games and apps. The interface puts the focus squarely on passively-consumed content, rather than interactive software, though the hardware can accommodate both.

Retina Display sharpness aside, spec fiends will appreciate that the anti-reflective IPS screen crams more pixels than an iPod touch or iPhone 4 into a much smaller enclosure than the iPad. Kindle Fire compromises a little on battery life, promising 7.5 to 8 hours for video playback and book reading, but delivers a lighter device that’s easier to hold for extended periods of time. And in a knife-twisting retort to Apple’s pledge to stand on the Kindle’s shoulders with (read: clone) the iPad’s iBooks and the iBookstore, Amazon cheekily noted—complete with an Apple USB cord as a visual—that unlike the iPad, Kindle Fire has no need to synchronize with a computer, as all of its content is stored in and accessed from Amazon’s cloud servers. These servers have notably been up and running for longer than Apple’s have been in beta testing. Additionally, Amazon has built a streaming video service of its own, and is shipping Kindle Fires pre-customized with the user’s already-purchased content. While there’s little doubt that Apple will eventually do the same things, Amazon’s not waiting for that to happen. Nor is it seemingly concerned with what Kindle Fire can’t do, such as wirelessly broadcast videos to televisions or dock with a hundred different speaker systems. Apple wasn’t worried about these things last year when it shipped the first iPad, either.

Amazon is also making the most of Apple’s recently problematic relationships with magazine and book publishers. Believing that the iPad was going to be the only tablet on the block for the foreseeable future, Apple dictated onerous subscription terms to companies that were accustomed to managing their own customer relationships and keeping a greater percentage of their sales. Many publishers protested, and some rebelled, building iPad-independent versions of their publications; Amazon subsequently reached out to them to create Kindle Fire-ready versions, too. It’s unclear whether Amazon will ever build the sort of stable that Apple’s App Store Newsstand is currently developing, but if the prior Kindles are any indication, the answer will be “yes” sooner rather than later.

Over the last few years, Apple’s “our way or the highway” philosophy has worked better than most people would initially have guessed—mostly because the other road has been more dangerous to travel. With Kindle Fire, Amazon has created an alternative that out-Apples Cupertino by offering end-to-end user experience simplicity, a small and light form factor, and a combination of features at pricing that Apple is highly unlikely to match. This holiday season, if you want to buy a 3.5” or 9.7” screened device, Apple will have you covered. If you want something in the middle at an aggressive price—and don’t care about all of Apple’s frills—Kindle Fire is going to have the market almost all to itself. Two of our editors have already pre-ordered Kindle Fires, and unless Apple releases a directly comparable device, we wouldn’t be surprised if many other long-time iPod fans did the same.

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Comments

1

We definitely all need to grab the popcorn and sit back, because this is probably the fight to watch. It’s a truly interesting clash of opposing consumer strategies.

Apple took one approach by making very compelling hardware that people wanted and then used that popularity to leverage getting 3rd party content onto their hardware. By doing what Apple has historically done: push things harder and farther in the beginning than businesses typically would, they gained the edge. Once they had the edge, it was their race to lose against the competitors they’ve had so far. All these wannabe Android tablets are hampered at almost every stage of competing except the one thing they can control, the specs, but the core features of the OS, content, etc., is all out of their hands. It’s a decided disadvantage versus Apple.

Enter Amazon. They went at it from the opposite direction and took a pre-existing, very successful media provision business and used that to leverage making hardware compelling. More than kind of brilliant, and just like how the particulars of Apple’s infrastructure and existing product and service ecosystem makes them hard to compete with using analogous methods, the same goes for Amazon.

Posted by Code Monkey in Midstate New York on October 3, 2011 at 6:28 AM (PDT)

2

i think the fire is the better deal…although the touch went down to 199, the fire is faster, newer, and bigger. the touch has been the same for a while, only undating to a new white shell. im probably going to put a case on it!!! i want it 1/2 for the games, and it really depends on if the fire has shazam and lots of other handy apps on the android market…so i guess ill just wait until Nov to see!! :D

Posted by mackinzie on October 4, 2011 at 5:58 PM (PDT)

3

@2: Heh, you know, didn’t even consider the Fire as a touch competitor, but on that front, if you aren’t already married to Apple’s ecosystem and/or the pocket portable form factor, it is kind of a no-brainer compared to the touch for the casual consumer who just wants something to watch some movies on, listen to some tunes, surf the web, and play some casual games.

I’m going to be highly amused if Apple’s decision to leave anybody not interested in a mandatory $800+/year contract with their tech toy out in the cold this year comes back to bite them like a rabid rottweiler.

If Amazon can move enough Fires and court enough game devs, this year is a freebie for them since for that end of the consumer market Apple decided to abstain on competing.

Posted by Code Monkey in Midstate New York on October 4, 2011 at 7:07 PM (PDT)

4

Yes, I would buy a 7” iPad in a moment.  But there is not one. Apple is 100% wrong on this.  Oddly wrong.  I would get one for trips, and have the current one for home use.  2 sales. 

But you forget that publishers also did not like the terms for Kindle books with it being $9.99 for most books.  So Apple and Amazon both have terms other businesses find onerous.  This may or may not be good for consumers, but I think it will.  Apple has in some ways become Microsoft, to the point the famous 1984 Superbowl ad could be (has been) made against them.

Posted by Michael on October 5, 2011 at 11:31 AM (PDT)

5

@4: Publishers didn’t like it, but the result is not what you think: they “forced” Amazon and Apple to allow them to de facto fix pricing, the complete opposite of the point you were trying to make. This is why Amazon has a disclaimer that they didn’t set the price for many of their eBooks, it’s also why Amazon and Apple are both currently tied up in a number of investigations about the price fixing.

Posted by Code Monkey in Midstate New York on October 6, 2011 at 4:43 AM (PDT)

6

The more I read about the Fire the more I’m tempted ... the first book I think I’ll get is “Beating Low Cost Competition: How Premium Brands can respond to Cut-Price Rivals” by Adrian Ryans, something that had better be on Mr. Cook’s reading list.

Posted by rockmyplimsoul on October 11, 2011 at 2:24 PM (PDT)

7

I am not sure that Kindle people are casual consumers or casual gamers.  The adults I see with Kindles are serious book readers. Movies, music, and a portable device that they can use to make Amazon purchases may just be icing on an already substantial cake. Kids I know with iPod Touches, a natural market for the Fire, are very serious about their music, and Amazon’s prices are very competitive. And of course, Amazon has really issued a challenge to Android companies, since they cannot get their act together and come up with a tablet that seriously interests anyone.

And then, there is this. People with iPads who also are Amazon Prime customers cannot use Safari to go to Amazon’s site and stream movies because Flash is required. This may make the Fire more tempting to some people than either the iPad or the Touch.

Posted by Singlestick on October 12, 2011 at 10:00 PM (PDT)

8

Well I’ve been waiting to get the new ipod touch w/camera, but it looks like that will not happen. Just wanted a device to play tunes, movies, web surf and take a few pictures.  The Fire does not take pictures either, but the larger screen would help these older eyes read email, web articles, and watch movies.  Can’t beat the price.

Posted by springbank on October 17, 2011 at 11:02 AM (PDT)

9

Amazon is selling their hardware at a loss planning to make their money back selling content.  Witness the recent concern expressed by Amazon stock holders who may not be too thrilled with the losses they’ll incur this quarter selling all those millions of Fires…  Apple makes almost all their money on hardware sales.

Opposite approaches to the market, yet both companies focused appropriately on the ecosystem—apps, eBooks, movies, music.  Something most of the other tablet competitors have ignored or were simply incapable of responding too.

I have an iPad and like it a lot.  But I’ve also bought a Kindle Fire for Christmas.  Hey, its only $200!  And yes it might mean that a 2nd iPad in our house will never come to pass.  Those who pretend the two don’t compete for people’s money are missing something.  People have only so much money and time.

I’m not certain about the Fire competing with the iPod Touch though.  Are people going to use a Fire to play music while they run?  Does it fit in your pocket?  Will kids play casual games on it?  I’m not so sure…

That said, for a lot of the uses of an iPad—email, web browsing, video watching, eBook reading, magazines, comics, etc the Kindle Fire should really do just fine.

And yes, Apple should of course stop being stupid and make a 7” iPad that is just slightly cheaper.  Or an 8.9” one or whatever if the 7” version results in too many apps not working properly as they claim.  They need to have a family of tablets at different price points like their competitors.

Posted by Fanfoot on November 1, 2011 at 10:31 PM (PDT)

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