Kindle Fire, Amazon's Strategy

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Innovation paper

The Kindle Fire by Amazon

The Kindle Fire was released on November 15, 2011 by Amazon. It’s a tablet computer, and it’s the last version of Kindle up to date. The product
Its dimensions are 7.5 by 4.7 inches, with a 0.45 inches of depth. The display is a 7 inches (180 mm) multi-touch color screen with a 600×1024 pixel resolution. Connectivity is through Wi-Fi and USB. The device includes 8 GB of internal storage, which is enough for 80 applications, plus either 10 movies or 800 songs or 6,000 books. According to Amazon the Kindle Fire can run up to 8 hours of consecutive reading and up to 7.5 hours of video. Let’s take a look on the software side.

The Kindle Fire runs a customized Android 2.3 OS. Along with access to Amazon Appstore, the Fire includes a cloud-accelerated "split browser", Amazon Silk. The user's Amazon digital content is given free storage in Amazon Cloud's web-storage platform, 5GB Music storage in Amazon Cloud Drive, and a built-in email application allows webmail (Gmail, Yahoo!, Hotmail, AOL Mail, etc.) to be merged into one inbox. Content formats supported are Kindle Format 8 (KF8), Kindle Mobi, TXT, PDF, DOC, DOCX, JPEG, GIF and a lot of others.

Why it is an innovative product? And what is the Amazon’s strategy with the Kindle Fire? Amazon tries to surf on the Kindle success by launching this product way under the market price. Amazon is willing to sell its core tablet device at a loss (one-quarter its list price) and at painfully low margins because it is an efficient point-of-sale storefront. They have 18 million songs, books, movies and television programs. The surprisingly low $199 price point will especially undercut smaller competitors and force more affordable hardware and software economics-even at Apple. Amazon founding CEO Jeff Bezos, said that the Kindle Fire is "a service" that provides "seamless integration" to all things Amazon for the world's largest online retailer. That represents a...
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