Kindle Fire: the tablet that knows your next move

Jeff Bezos's announcement of Amazon's assault on the tablet market comes with an added twist

On Wednesday, the tablet wars began. Up to then, all talk of a "tablet market" was misleading: it was essentially an iPad market.
Having launched in April 2010 a device for which most people thought there was no definable niche, Apple then proceeded to sell upwards of 30 million of these insanely expensive consumer products, on which it was reportedly making a 40% margin.
There were other tablets, most of which, with one notable exception – the Samsung Galaxy Tab – were turkeys. But until Wednesday, nothing had appeared that looked like being able to make a dent in Apple's licence to print money.
The challenger emerged from the expected source: Amazon. On Wednesday, Jeff Bezos, the company's charismatic founder, unveiled the Kindle Fire, its first venture into the tablet market.
At this point, non-technical readers, clutching their beloved Kindles, may object that Amazon has been in the tablet market ever since the Kindle launched in 2007. But the Kindle is not really a tablet computer in any meaningful sense – it's an information appliance that fulfils one function well: fetching and displaying ebooks.
The Fire is different. It has a colour touch screen and can play video, for example. More significantly, it can run apps, has a proper operating system (a customised version of Google's Android) and does wireless networking. And it comes with its own, custom-designed web browser, called Silk (of which more in a moment). Oh, and at $199 it's less than half the price of a basic iPad2, which may, in the end, turn out to be the most important thing about it.
The Fire doesn't go on sale in the US until 19 November and so we will have to wait for the tech vultures who disassemble new kit to do their stuff before we know what its bill of materials actually comes to.
But my guess is that Amazon will be selling it at a loss, just as it did with the first Kindle. And that highlights the difference between it and Apple. Amazon makes its money from content – sales of books, music, videos – and uses the Kindle as a way of enabling "frictionless purchasing" of that content. Apple, in contrast, makes most of its money from selling beautiful kit with outrageous profit margins. It also sells content – think of the iTunes store – but the margins on that are significantly less than on the hardware.
Which is why the tablet wars have just begun. Amazon is just about the only outfit around that can give Apple a run for its money. It has vast amounts of content instantly available in its internet "cloud" and a purchasing and order-fulfilment system at least as slick as Apple's. If it turns out that the Fire tablet is really as good as Amazon hopes at encouraging people to consume digital content, then it can continue to sell the Fire at below cost, challenging Apple to reduce the price of the iPad and thereby erode its margins.
The prospect of the forthcoming battle between these two technology giants has led some excitable analysts to declare that, whichever company triumphs, "the consumer is going to be the winner". Oh yeah? The reality is that both Apple and Amazon are aiming at the same thing: locking in the consumer to their system. Apple has done this via the iTunes and App Store, which ensures that nothing runs on an Apple iDevice that hasn't been approved by the company. Amazon's approach is only slightly more subtle. The Fire comes with only 8GB of memory, which means that most of the content that its users will access will come from Amazon's Cloud storage. In that sense, the Fire is the ultimate network appliance.
But there's an added twist. The Fire also comes with a pretty slick browser that loads pages faster than even browsers running on fast PCs. So 100 millisecond (ms) load times are reportedly reduced to 5ms. This is achieved by having the processing done not by the Fire but by remote virtual machines running in Amazon's EC2 Cloud, and by clever caching and pre-emptive fetching of links. "This means," writes Jason Calacanis, a well-known internet entrepreneur, "if you're on the NYTimes.com they have, in their cloud and possibly already on your device, the next five pages you're going to click on. They know this because the last five folks to hit the NYTimes.com's homepage opened those pages. These kind of caching services have a ton of privacy implications, as they are now sitting between you and your favourite porn site… I mean political activism site! Not only do they have an entire history of which URLs folks are downloading, they have the actual download."
The phrase "all fired up" is about to acquire a whole new meaning.

Kindle Lights Fire under iPad

KOMPAS.com - Amazon's unveiling of the Kindle Fire tablet computer sends a bright-hot message: the online retailer is ready to rival iPad maker Apple in an effort to be the world's top digital content provider.
It may sound odd coming from a company that pioneered online sales of physical products, selling its first book, Douglas Hofstadter's Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought, in 1995.
But since it first entered the digital market in 2006 with its video download store, Amazon has bet consumers will pay for high-quality digital content.
In addition to the millions of actual items it sells, which range from toys to toothbrushes, Amazon's trove of digital content now includes more than 1 million e-books, 100,000 movies and TV shows and 17 million songs. This is about 1 million fewer songs than iPad maker Apple sells, but more than twice as many e-books and many thousands more TV shows and movies.
Amazon CEO Jeff Bezos is confident that its content is what will help the Kindle Fire do better than others who have trotted out tablets.
"The reason they haven't been successful is because they made tablets. They didn't make services," Bezos said in an interview after his company unveiled the tablet at a New York media event Wednesday in the US.
Bezos, a 47-year-old former Wall Street money manager, built Amazon on exactly this sort of confidence. He started the company on the theory that a web-based book store would resonate with consumers, since it seemed like the easiest way to browse millions of titles at once.
He was right. The company grew rapidly and Amazon began trading publicly in May 1997, despite never having turned a profit. It took five more years — and the addition of product categories like CDs, DVDs and consumer electronics — before the online retailer reported any net income.
These days, Amazon consistently reports strong growth: in the most recent quarter, it earned $US191 million on $US9.91 billion in revenue.
It was Apple that moved into digital content first, however. With the arrival of Apple's iPod digital music player, which first came out in 2001, Apple figured consumers would be willing to pay for legal, high-quality digital music they could download to the devices.
Apple became a major player early on, making deals with major record labels to sell digital tunes through its iTunes Store in 2003. Soon the iPod became more multimedia-savvy: Apple added TV shows in 2005 and movie downloads a year later.
Amazon soon entered the market itself, rolling out its own digital video downloading service in 2006 and music downloading service a year later.
It was in 2007, though, that things really heated up. That's when Amazon rolled out its first Kindle e-reader, upending the book market once again by turning the focus from costly paper books to electronic ones that could be delivered quickly and cheaply to customers on a reading device.
The Kindle rapidly grew the company's e-book business, and Amazon said in May that it was selling more e-books than physical copies of books. But the Kindle Fire's ability to show e-books, surf the web, stream movies and TV shows and support apps positions it as an even better catalyst for Amazon's digital goods sales.
The price will probably help, too: when it goes on sale on November 15 in the US, it will cost $US199, which is less than half of the $579 you'll pay for Apple 's cheapest iPad and less than book seller Barnes & Noble's Nook Colour e-reader, which isn't available in Australia.
This leaves buyers with plenty of money left over to spend on content. Unfortunately for Australians there is no release date yet for a local launch of the Fire, with a spokeswoman for Amazon yesterday saying that that the Kindle Fire would only be available in the US.
"It's important to remember at the end of the day that Amazon's core business is retailing and this is a way to sell more digital media on a sort of 7-inch [17.78-centimetre] vending machine," NPD Group analyst Ross Rubin said.
The Kindle Fire, which runs Google's Android software, is clearly meant for gobbling up Amazon's digital media in particular. While most Android tablets include access to Google's Android Market for downloading games and apps, the Fire will eschew that in favour of Amazon's own app store.
And while the tablet doesn't have much storage space — 8 gigabytes, compared with 16 GB on the cheapest iPad — Amazon is offering users free web-based storage for any digital content they buy from Amazon.
Another weapon in Amazon's arsenal: in hopes of keeping Kindle Fire users purchasing both digital and actual items, the tablet includes a free month of Amazon's premium shipping service, Amazon Prime.
Prime, which costs $US79 per year, gives users unlimited two-day shipping on any items they buy from Amazon, as well as free access to a library of 11,000 streaming movies and TV shows. This is about half of what Netflix's streaming library has. Netflix is not available in Australia.
Amazon has never said precisely how many Kindle e-readers it has sold, but its higher sales of e-books than print books indicates it's a strong performer. Given this, and the general popularity of tablets, expectations are high for the Fire.
Rubin thinks consumers will become fans of the tablet, saying it offers a more complete media consumption experience than what Barnes & Noble has provided with the Nook Colour, which came out last year.
Forrester Research analyst Sarah Rotman Epps thinks Amazon could sell as many as 5 million Fires by the end of the year, but thinks it will probably be closer to 3 million since it's coming out so late. Apple, by comparison, has sold nearly 29 million iPads since it released the first one in April 2010, and over 9 million in the June quarter alone.
Of course, in addition to being the new tablet on the block, the Kindle Fire faces other challenges. On the content side, the Amazon Appstore currently includes more than 16,000 apps, but this is just a small fraction of the 425,000 apps in Apple's App Store, over 100,000 of which are tailored specifically for the iPad.
On the tablet side, the device's screen is on the small side, which means less space for watching movies and more panning around when surfing the web. And it will only be able to access the internet over wi-fi, not over wireless carriers' high-speed data networks.
Still, Epps believes Amazon's decision to lead with content and services, rather than hardware, will help it prosper with the Kindle Fire.
"Apple will still be the clear market leader, but Amazon will still be a clear number two because of that strategy," she said.

Sumber :

AP and Fairfax Media

 

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Can Kindle Fire match the iPad?

Amazon's Jeff Bezos makes a bid to be the new Steve Jobs with the launch of a cut-price rival to Apple's touchscreen tablet

Jeff Bezos has been reading The Remains of the Day. A novel of quiet subtlety. Or so the Amazon boss told the audience at a press conference in Manhattan on Wednesday. From his actions, it seems more likely that he has been at the Sun Tzu.
Bezos made a bid to be the new Steve Jobs, declaring war on Apple with the launch of a cut-price rival to the iPad, with the two technology titans now squaring up over who will own the device that delivers the future of music, movies and TV online.
The $199 (£128) colour touchscreen tablet called the Kindle Fire was unveiled at a press conference in New York with all the secrecy and prerelease teasing Apple usually sprinkles on its launches.
The new Kindle is far less advanced than the iPad. It doesn't offer a mobile connection, working only with Wi-Fi; it doesn't have a camera or microphone; and its screen, at 7 inches, is smaller than the iPad, at 9.7 inches.
However, at half the price, analysts said it presents the first serious challenge to the iPad's dominance of the tablet market, as Bezos tries to build on the success of his company's Kindle book reader with a colour-screen, multimedia offering for US consumers. In Britain, buyers will have to wait until next year at the earliest.
Janney Capital Markets analyst Shawn Milne said he expects between 2 million and 3 million Kindle Fire tablets will be shipped in the fourth quarter. Others are aiming higher. "At $199, the Fire is sure to be a highly disruptive product in the tablet market, particularly in the lead-up to Christmas," said David McQueen of Informa Telecoms & Media.
Bezos revealed the device after introducing a new range of simpler Kindles, one of which will be available in the UK for £89 from 12 October. But it was the Kindle Fire that seized the limelight: a device intended to build on the popularity of the company's e-readers and reach a broader audience that wants to browse the web, listen to music and watch movies and video. The device will also feature a news stand for users, stocking Kindle Fire-friendly versions of titles from publishers including versions of Cosmopolitan, Vanity Fair, Wired and Glamour.
The event had echoes of one of Jobs's famous Apple presentations. Bezos, dressed causally in open-neck shirt and jeans, went for a slow reveal. First there was a history of the Kindle and a chance for Bezos to display some of the unkinder comments people had made about the best selling e-book reader when it was launched. Then came the new generation of Kindles, and finally Kindle Fire. And then the price. "We're building premium products at non-premium prices," said Bezos. "We are determined to do that."
Bezos also announced a new web browser, called Amazon Silk, which he said was tailored for mobile devices, as the company that was once just an electronic shop also encroached on territory once dominated by Microsoft. "It's truly a technical achievement," he said.
He then took a swipe at Apple, saying there would be no need to synchronise the Kindle Fire to a computer, as people do with their iPads. "That model, that you are responsible for backing up your own content, is a broken model," he said.
Michael Gartenberg, analyst at Gartner, said the announcement pitched Apple and Amazon head to head in the battle for "cloud" media services. Both Apple and Amazon have been developing services that allow customers to store their music, movies and TV shows remotely – "in the cloud" – and then access them from any device connected to the web. Next week, Apple is expected to respond, with more details of its inevitably-named iCloud service next week. "For me, that was the most significant part of the announcement," said Gartenberg. He said the Kindle Fire looked like a good product and was priced to sell, but the real battle was "in the cloud".
Amazon plans to begin taking orders for the Fire on its US website immediately, and will start shipping on 15 November. Bezos said the company was "making many millions of these" – but Amazon has no immediate plans to launch the Fire in the UK.
Reaction at the event was mixed. Avram Piltch, editorial director at Laptop Magazine, said the device looked "more like an iPod killer than an iPad killer". He said the Kindle Fire looked set to be a big seller for people who want to use it to consume media, but it didn't have enough firepower to take on the iPad or other tablet manufacturers who were making devices for people at work rather than play.
The new Kindle has its work cut out for it. Apple sold more than 29m iPads in the product's first 15 months on the market. Most of its competitors have bombed. Hewlett Packard scrapped its tablet device in an embarrassing U-turn that contributed to the ousting of its chief executive. Blackberry maker Research in Motion shipped just 200,000 of its own rival to the iPad, the PlayBook, in three months.
But, said Gartenberg, Amazon has one big advantage over the other would-be iPad killers: content. "Amazon has millions of customers already buying their stuff. It has their credit card details, it knows their names. That's a big advantage," he said.
Next Tuesday, Apple will have its chance to respond – except that its big launch for Christmas is the latest version of the somewhat smaller iPhone. The battle has just begun.

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