Amazon.com Already Hates and Fears the iPad Mini

No company has more to lose than Amazon.com (Nasdaq: AMZN  ) should Apple's (Nasdaq: AAPL  ) new iPad Mini succeed. Long before Google's (Nasdaq: GOOG  ) Nexus 7 arrived on the 7-inch scene, Amazon's first Kindle Fire made a big splash by targeting a lower end of the market.

Amazon was able to pursue a strategy that no other tablet maker at the time would or could: sell at cost and profit on content afterwards. Other hardware OEMs without digital storefronts were helpless to compete, even if they were able to produce better tablets strictly in terms of hardware quality. Ironically, the Kindle Fire's success showed that mediocre hardware was sufficient provided it had strong content offerings.

The iPad Mini hasn't even hit store shelves quite yet, but Amazon already hates and fears the new device.

Yet another vaguely impressive figure
The e-tailer even took the time out of its earnings press release to boast of the 7-inch Kindle Fire HD's advantages over the iPad Mini, saying it has more pixels and higher pixel density, offers HD content, and has better speakers, all while costing $130 less.

When asked about the iPad Mini's threat after it was unveiled, Amazon characteristically offered up another impressive, yet vague, sales figure, telling AllThingsD, "Wednesday [the day after the iPad Mini event] was the $199 Kindle Fire HD's biggest day of sales since launch and up 3x week over week." That suggests many consumers who may have been waiting on the sidelines were disappointed with what Apple had to offer. We already knew Amazon was selling a lot of these tablets, but your guess is as good as mine as to how many that actually entails. Either way, three times "a lot" is more than "a lot."

Amazon has now plastered a big battle cry right up on its home page, a clear proclamation of "Bring it!" toward Cupertino's general direction.

Source: Amazon.

Amazon is one of the most heavily trafficked websites on the Internet, so you know this is going to be seen by a lot of eyeballs. These are all words and actions of a company that has a lot to lose, and fears it may lose, but remains confident in its compelling value proposition.

Objection, your honor
Of course, if you ask the Mac maker, it will point to its 35% larger screen size, higher build quality, thinner and lighter body, better cameras, and wider selection of tablet-optimized apps. Apple made sure during its presentation to point out its advantages over its 7-inch rivals, and clearly the Kindle Fire HD and Nexus 7 are what the company had in mind.

Let's stack the two up side by side, with the advantages that an average consumer would be likely to perceive bolded.

Specification

Kindle Fire HD

iPad Mini

Display size

7 inches

7.9 inches

Resolution

1280 x 800

1024 x 768

Pixel density

216 ppi

163 ppi

Cellular connectivity

Not available

Available

HD content

Yes

No

Wi-Fi

Dual band

Dual band

Processor

Dual-core OMAP 4460

Dual-core A5

Battery life

11 hours

10 hours

Cameras

Front-facing HD camera

Front-facing FaceTime HD camera; rear-facing 5-megapixel iSight camera

Dimensions

193 mm x 137 mm x 10.3 mm

200 mm x 134.7 mm x 7.2 mm

Weight

395 grams

308 grams

Apps

34,000

275,000

Entry-level price

$199

$329

Sources: Amazon, Apple.

Also, the iPad Mini will be available in many more countries around the world with more localized content, but the Kindle Fire has a greater selection of e-books under Amazon's belt.

Winner: TBD
While I may think the iPad Mini boasts the most advantages, despite its hefty premium, there are probably just as many people who swing the other way. This battle has just begun, and the victor is yet to be determined.

The difference in pricing underscores the two dramatically different approaches these tech heavyweights are using to tackle the tablet market. Amazon uses hardware to sell content; Apple uses content to sell hardware.

Who will win?

Everyone knows Amazon is the big bad wolf in the retail world right now, but at its sky-high valuation, most investors are worried it's the company's share price that will get knocked down instead of those of its competitors. We'll tell you what's driving the company's growth, and how to know when to buy and sell Amazon in our new premium report. Our report also has you covered with a full year of free analyst updates to keep you informed as the company's story changes, so click here now to read more.

Evan Niu, CFA, owns shares of Apple. The Motley Fool owns shares of Apple, Amazon.com, and Google. Motley Fool newsletter services recommend Apple, Amazon.com, and Google. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 29, 2012, at 11:21 PM, lrd555 wrote:

    Amazon's tablet measure is all but dead. You see a good chunk of the people who buy the smaller Kindle bought it not because they could save $100; but because of its size. They wanted something they could toss in their purse or briefcase quickly and easily. Well, the new iPad mini offers more value for a little more $ @ just the right size.

  • Report this Comment On October 30, 2012, at 2:35 AM, RussellL wrote:

    They will save $130, not $100 that lrd555 claims.

    With the Kindle Fire HD's higher resolution display & better speakers, movies, music, pictures and web pages look and sound better than ANY tablet from Apple, at ANY price!

  • Report this Comment On October 30, 2012, at 10:03 AM, stefnagel wrote:

    In portrait mode, the iPad mini has a 35 percent larger viewing area in portrait mode and a 67 percent larger viewing area in landscape mode. Just saying, the Mini is a LOT bigger device than the Fire effectively in size and in viewing area. So it's really comparing an apple to maybe a plum, not to say a lemon.

  • Report this Comment On October 30, 2012, at 12:17 PM, dlchase24 wrote:

    I think the iPad mini is more likely to hurt iPad sales than to hurt Kindle Fire HD sales. Most people will buy the Kindle Fire HD because of the lower price and most people will buy the iPad mini because it's an Apple product. There will be some who may be swayed one way or the other because of specs or whatever, but I don't think most will.

    Also, while everyone is comparing the iPad mini to the Kindle Fire HD... maybe it should be compared to the Kindle Fire HD 8.9 (or whatever the name is). It's about the same screen size difference and the 8.9 from Amazon is still $30 cheaper than the mini.

  • Report this Comment On October 30, 2012, at 6:57 PM, JGBFool wrote:

    Can't Amazon sell content that would be viewed on the iPad? If they're selling the Kindle at cost in order to sell content, then it seems irrelevant who makes the tablet.

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