In case you were watching Bill Clinton's DNC love-in for Barack Obama Wednesday night, it may come as news that Amazon teased its new Kindle devices during the NFL season opener. Rumored to include the Kindle Paperwhite, the official press conference begins today at 10:30 a.m. PT in Barker Hangar and will be covered live. [Update: more details here.]
CNET reported last week the debut of two 7-inch Kindle Fires, “including a high-end model with a zippy processor, a camera, physical volume controls, an HDMI port, and larger storage than a second, more bare-bones version.”
Amazon’s uber-strategy is to sell the devices at a low enough price point to ensure deep market penetration, and then make money on higher-margin content, e.g., e-books, video, games, apps and music.
"The swing factor in the expectation on the upcoming Kindle Fire could be on how much lower pricing can go," said So Young Lee, analyst at SunTrust Robinson Humphrey. "Introducing a tablet below the $150 mark could be compelling and another game changer in the industry where the $199 price point is no longer unique."
As the battle between Amazon and Apple and Google augments, "a successful tablet is much more important for Amazon than Google. Amazon has to have devices that let customers purchase and consume digital content," said Chad Bartley, Pacific Crest Securities analyst in Reuters. Amazon may lower prices further with an ad-supported Kindle Fire version as it already does with its $79 e-reader priced at $109 without ads.
Meanwhile, rumor of a branded Android smartphone, not-ready-for-primetime is swirling. “Word has it that the phone will run on Android 4.0 Ice Cream Sandwich and is expected to come with Nokia Maps which is an interesting twist.”
Kindle Fire is the #1 best-selling product on Amazon and since its launch less than one year ago has captured 22% of U.S. tablet market and earned more than 10,000 5-star customer reviews
“We’re grateful to the millions of customers who have made Kindle Fire the most successful product launch in the history of Amazon,” said Jeff Bezos, Amazon.com Founder and CEO. “Kindle Fire is sold out, but we have an exciting roadmap ahead—we will continue to offer our customers the best hardware, the best prices, the best customer service, the best cross-platform interoperability, and the best content ecosystem.”
Not to be left in the digital ethers, Kobo has announced “an eReader for Everyone,” introducing Kobo Touch, Kobo Mini, Kobo Glo and Kobo Arc:
Starting at $79.99 this new Kobo family will be available at 2,000 U.S. bookstores across America though partnership with the American Booksellers Association including Indigo (Canada), WHSmith (UK), FNAC (France), Mondadori (Italy), Libris (Netherlands), Collins (Australia), Whitcoulls (New Zealand) and Rakuten (Japan).
"Our focus has remained firmly on delivering a superior experience for booklovers around the world. With 11,000 booksellers and leading retail partners across five continents, we are bringing the new Kobo Family to booklovers everywhere," said Michael Serbinis, CEO, Kobo.
"The new Kobo Family provides more choice for booklovers and a superior eReading and content discovery experience – truly, an eReader for Everyone."
And then there’s Apple, widely rumored to be announcing its "iPad Mini" in October at a similar price point which many suggest might make Amazon’s Kindle – less relevant.
"So far the customer's choice is deciding between high end, Apple, and low end, Amazon," said Aaron Kessler, analyst at Raymond James & Associates. "If Apple releases a price competitive [iPad] Mini, that could completely change the low-end market. Apple [iPad] has been the tablet of choice when people can afford it, so if pricing were equal, Apple would have the edge. Amazon has to add value in other ways."
Another point of view from Victor Anthony, analyst at Topeka Capital Markets, "The short of it is that an Apple iPad [Mini] will take significant share. But Amazon never set out to dominate like Apple did, and it doesn't have to. Getting even a small part of this big market is really a success." While the unveiling of a smaller iPad is exciting, according to a survey from PriceGrabber.com, it’s the next-gen iPhone that captures consumer attention even more.
“In the survey of 1,740 U.S. online shopping consumers, 34 percent of respondents said they would prefer that Apple debut the iPhone 5 at its Sept. 12 media event, as expected, rather than a so-called iPad mini. Twenty-eight percent are hoping Cupertino will unveil the much-rumored 7-inch iPad, and an optimistic 38 percent are hoping to hear about both.”
Predictions are that Apple could sell up to 10 million iPhone 5 units in the first week. Stay tuned – as the eReader battles escalate to new technology highs – and perhaps new price point lows.
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