In the run up to its launch, many tech pundits positioned the Amazon Kindle Fire as the first serious iPad competitor. And according to recent sales reports, where there’s smoke, there’s fire. The Kindle Fire was the number one selling product on Amazon for 8 weeks in a row. It even outsold the iPad on Black Friday in Target stores. Analysts are predicting Amazon will sell 5 million touch tablets this year, and 20 million in 2012.
So why did the Amazon device succeed where the Motorola Xoom, BlackBerry PlayBook and HP TouchPad failed? The lower price point has something to do with it. But what the Kindle Fire has that other Android tablets lacked is access to a built in media ecosystem. Quoting from Steven Levy's recent Wired article:
Almost half of [Amazon’s] revenue comes from sales of media like books, music, TV shows, and movies—and the fire-sale-priced Fire is designed to be primarily a passport to the large amount of that content that’s available digitally. The gadget comes preloaded with customers’ Amazon account information, and anyone who signs up for Amazon Prime, the company’s $79-a-year shipping service, will be able to access more than 12,000 (and counting) movies and TV shows on the Fire at no extra charge.
This is the Amazon strategy: deliver low-cost hardware alongside unbundled streaming media that consumers can access through the cloud. Much of the “premium” video content is pay-per-view, though, so the videos become a mix of free and paid content. For an early look at how viewers are adopting the Fire, check out our recent infographic.
Is the Kindle Fire an iPad killer? Only time will tell. Apple has a commanding market position. But Amazon’s built-in media ecosystem is an advantage that previous tablet challengers have sorely lacked.