Amazon.com Inc. on Wednesday unveiled the Kindle Fire tablet for $199, the latest -- and possibly biggest -- challenger to Apple Inc.'s dominant iPad.
The new tablet, which works off a customized version of Google Inc.'s Android operating system, has a seven-inch (18cm) screen and can access Amazon's app store, streaming movies and TV shows. The tablet will go on sale Nov. 15 and people can start pre-ordering Wednesday.
"We asked ourselves, 'Is there some way we can bring all of these things together (web service, Prime, Kindle, instant video and its app store) into a remarkable product offering customers would love?"Amazon CEO Executive Jeff Bezos said at the company's launch event in New York City. "Yes, the answer is Amazon Kindle Fire."
Amazon shares recently rose 3.6 percent to $232.13.
Questions, though, remain about the device's technical limitations and lackluster selection of apps, especially in comparison to the iPad. The device does not have a camera or microphone, and it does not offer cellular connection, working only with WiFi.
Nonetheless, Janney Capital Markets analyst Shawn Milne expects between two million and three million tablets will be shipped in the fourth quarter before the analyst expects a beefed-up version, possibly with a 10-inch (25cm) screen and dual processor, to become available early next year.
Amazon, though, appears to be following the same formula that has helped to make its Kindle the de facto standard for dedicated e-readers and the bestselling product in Amazon's history. Specifically, with the new tablet, Amazon is offering an attractively priced device with basic, easy-to-use features, and accompanied by an intense promotion campaign on the company's heavily visited website.
"Amazon has an advantage that other tablet manufacturers don't in that millions of people already visit its site on a regular basis," said Ken Sena, an analyst who covers Amazon for Evercore Partners. He added that those consumers will be regularly exposed to advertisements for the device.
"It certainly creates a competitor to the iPad," Sena said.
Apple's iPad, credited with kicking off the consumer tablet computer market, has won plaudits for its ease of use, elegant design and selection of over 90,000 apps that transform it into everything from a video player to a DJ turntable. The iPad remains the most popular tablet by far, having sold 29 million versions since its introduction and owning more than two thirds of the market.
So far, iPad rivals have struggled to compete with the device's price, functionality and popularity. As a result, competitors like Research In Motion Ltd.'s PlayBook, Hewlett-Packard Co.'s TouchPad, Samsung Electronics Co. Ltd.'s Galaxy Tab and Motorola Mobility Holdings Inc.'s Xoom have failed to attract mass audiences.
In addition to the Fire, Amazon also introduced on Wednesday a touch-screen e-reader called Kindle Touch. The device, a black-and-white product that does not have a keyboard found on previous Kindles, will cost $99 for the WiFi-only version and $149 with 3G cellular connectivity. Both will start shipping Nov. 21.
"We're going to sell millions," Bezos said. He also unveiled a non-touch-screen Kindle for $79 that is shipping, starting Wednesday. Previously, the cheapest Kindle was a $114 ad-displaying version.
Source: The Wall Street Journal