Amazon is expected to release a new version of its Kindle Fire tablet on Thursday -- but if Apple releases a similarly sized and priced iPad this fall, Amazon's tablet may be doomed.
The iPad has absolutely dominated the tablet market since its 2010 release. Its huge app library and best-in-class features have given would-be tablet rivals little room to grab even the tiniest slice of the market.
Of all the tablet makers, Amazon has enjoyed the most success in competing against the iPad. Its strategy: Amazon attacked a smaller segment of the tablet market and went for the jugular on price, undercutting the iPad by $300 with its 7-inch $199 Kindle Fire.
Amazon will likely unveil an improved Kindle Fire 2 at an event in California. But the company's size and price advantage could quickly vanish: Apple is widely rumored to be announcing a similarly sized "iPad Mini" for close to the same cost in October.
Without a key differentiator from the iPad, Amazon will have to re-think its strategy for battling Apple.
"So far the customer's choice is deciding between high end, Apple, and low end, Amazon," said Aaron Kessler, senior research analyst at Raymond James & Associates. "If Apple releases a price competitive [iPad] Mini, that could completely change the low-end market."
The Kindle Fire's eye-popping price and smaller size helped Amazon carve out as much as 14% of the market during the 2011 holiday season, according to IHS iSuppli. The iPad still held 57% of the market that quarter, but taking away that much share from Apple was a minor coup for Amazon.
But if the low-end/small tablet market mirrors that of the full-size devices, Amazon could be in big trouble. Other tablet makers -- like Hewlett-Packard, Motorola, and Research in Motion -- learned the hard way that when customers have $499 to spend on an iPad or another tablet for the same price, they're almost always going to choose the iPad.
"Apple [iPad] has been the tablet of choice when people can afford it," Kessler said. "So if pricing were equal, Apple would have the edge. Amazon has to add value in other ways."
Laura DiDio, principal analyst at research firm ITIC, thinks Amazon needs to step it up on both features and price.
mitch daniels shirataki noodles john kerry prince fielder state of the union address 2012 obama state of the union 2012 2012 state of the union address
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.