New Kindle models announced

New Kindle models announced

Ars (and everyone else) has reported on Amazon’s announcement of the Kindle Fire and Kindle Touch.

If you follow tech news you’ll likely get an earful about this today. The important things you need to keep in mind are:

– “Cheap and plastic” (flexible, not necessarily the material itself) is a very winning strategy with computers and consumer electronics. The iPad was fantastically cheaper than comparable tablets when it was first released. In practice, it let you do far more than what you could do with a $2000 tablet PC despite having nowhere near the level of computer power.

The Amazon Fire is at this point a platform for selling and streaming media and browsing the web. It does way more (for the average consumer) than any other tablet available for the money if you’re already an Amazon Prime subscriber. It’s still a pretty good deal if you need to sign up for Prime.

I’d guess that it does 50%- 70% of what most folks use their iPads for. It seems likely that this will increase the market of tablet consumers rather than eat into Apple’s customers.

– Amazon wants to be your store for “everything”. The devices themselves are likely going to break even. They want to own streaming video and magazines (if that ever takes off) the way they own ebooks right now, as well as eat into Apple’s part of the music industry. Getting their devices into twice as many hands as Apple would give them a huge advantage in negotiating deals with content owners, which would make their devices a better deal for consumers, which would create a virtuous circle for Amazon allowing them to be the middle man for media.

– Amazon is using what they know well against what Apple doesn’t know well. Using EC2 as a backend for media streaming, web browsing, etc. potentially gives them a huge advantage over Apple. We’ll see how well this plays out in the real world.