Two Reasons Why an Amazon Tablet Could Compete with the iPad

by Sam Dean - Aug. 30, 2011Comments (1)

Not long ago, when Amazon first reported that it would be selling the Kindle eBook device, many analysts scoffed, and they had good reasons to do so. For one thing, many players with experience in the hardware business had tried and failed with eBooks. But there is no doubt that the Kindle is a resounding success, and delivering it was a bold move for an ecommerce company to make. Now, Amazon is said to be on the cusp of delivering its own tablet, with most rumor mills agreeing that it will run the Android OS. While there are those who think that an Amazon tablet won't have a chance against Apple's iPad, there are two big reasons why it just might.

Forrester Research analyst Sarah Rotman Epps is being widely quoted for noting that "if [Amazon's tablet] is launched at the right price with enough supply, we see Amazon's tablet easily selling 3 million to 5 million units in Q4 alone." Those numbers, of course, would make the Amazon tablet directly competitive with Apple's iPad.

So is that forecast in the ballpark? It just may be. Amazon, unlike other makers of Android tablets who have sought to compete with the iPad, is an established player in delivering digital media, including eBooks and music. Some people prefer Amazon's music delivery system, and pricing, to iTunes. If Amazon offers digital content consumption at fairer prices than iPad users are getting that would be a unique market advantage--not one that just any Android tablet maker could replicate.

Secondly, as The Wall Street Journal notes, Amazon's tablet could come in below a $300 price point, while iPads range from $499 to more than $800. Amazon could achieve a great price point by basing its tablet on Android, and it might even sell tablets at a loss, given the fact that it can sell tablet owners digital content on an ongoing basis. Just look at the Kindle, where Amazon's business model is not to make money on the hardware, but to sell eBooks.

Amazon has yet to confirm details, if there are any, on what its tablet offering might be like, but it makes complete sense for the company to enter the market and compete with the iPad. With the Kindle, Amazon has learned what it is to marry a useful hardware device with digital content.

John Mark Walker uses OStatic to support Open Source, ask and answer questions and stay informed. What about you?


Amazon must consider their stakes and the risk in this. They can launch something that is less in magnitude than the tablets and leave behind the idea of competing with Apple!

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