Amazon's Next Anti-iPad Move: Go Cheaper

It might be hard to believe, but the Kindle Fire is starting to get a bit on the old side; the tablet was unveiled last September. In the video below, senior technology analyst Eric Bleeker discusses recent reports from DIGITIMES that Amazon could be readying production of a new Kindle Fire and a $149 version.

That move would mirror what Amazon's done with Kindle e-readers themselves, wherein the company gradually cut prices so that entry-level units now sell for $79. Another interesting wrinkle is that reports claim Amazon has halted development on an 8.9-inch version, but will continue work on a 10.1-inch variety.

After a hot start, Kindle Fire sales dramatically slowed during the first quarter, but that's to be expected. The tablet had just wrapped up a launch holiday season. While the media focused on researcher IDC's estimates of 750,000 Kindle Fire shipments during the first quarter, that shipment number was lower in large part due to the high level of inventory Amazon shipped out during the holiday season. In terms of sales, NPD, another researcher, offers an estimate of 1.8 million units sold during the first quarter. That's good enough to put the Kindle Fire well ahead of the competition as the second-most popular tablet.

However, Eric notes an ominous sign: Kindle Fire users don't seem to have higher customer satisfaction compared to Android tablets. That's a troubling sign for the tablet. While a future version of the Kindle Fire could have a larger screen or one with a higher resolution, if users don't enjoy the underlying platform, that's not something easily fixed. To see Eric's full thoughts, watch the video below.

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Eric Bleeker has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Google, and Microsoft. Motley Fool newsletter services recommend Apple, Google, and Microsoft. 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.

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  • Report this Comment On June 21, 2012, at 8:06 AM, jdmeck wrote:

    People who are paying low ball prices for a Kindle would never have bought an iPad anyway, so amazon is only hurting itself.

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