Kindle Fire Outsells iPad at Target

  • Posted: 29 November 2011 10:33 AM #16

    Mace - 29 November 2011 12:39 AM
    Gregg Thurman - 29 November 2011 12:24 AM
    iOSWeekly - 28 November 2011 10:38 PM

    http://www.appleinsider.com/articles/11/11/28/amazon_says_kindle_fire_is_its_best_selling_product_but_wont_reveal_numbers.html

    Another indication that the Kindle Fire represents the first true competition for the iPad. Despite its shortcomings, the super low price and amazons kindle brand & ecosystem is enough to give it serious weight in the tablet market.

    Not that this is all bad for Apple. Although it might mean margin pressure on apple next year if it sees the need to introduce a cheaper iPad entry price point, the good news is that amazon completely obliterates any other competition from regular hardware vendors releasing android tablets - as there is simply no margin for them so they are not going to bother competing with Amazon.

    I really feel that the Kindle Fire and iPad are two different products addressing two different consumers, mostly distinguished by price.  That Amazon may sell a lot of these isn’t important.  Making a profit is, and the Fire has taken the remaining oxygen away from other Android manufacturers.

    Apple is selling the iPhone 3GS at a price low enough that with carrier subsidy it is virtually “free”.  Apple does not have to develop a special low cost iPad to meet lower tier buyer’s price points.  With the iPad 3 I’ll guarantee that Apple will offer the Wi-Fi only iPad 1 (16Gb) at $299, and the Wi-Fi only iPad 2 (16Gb) at $399.

    With software and services updates the iPad 1 will be equal to, or greater than, the Fire in performance, features and ecosystem.

    Be careful not to jump into conclusion too quickly.  Disruptors usually come in with seemingly crippled product at a lower price tag to the product by the entrenched vendor.  Hopefully Apple would do like you think, three price points for iPad next year.  The $299 price point is necessary to suck the air out of competitor’s tablets.  In the music market, Apple took awhile to introduce iPod shuffle, Apple shouldn’t take that long in the tabloid market as the competitors are a lot tougher and shrewder.

    IMHO AMZN can’t sustain this model.  When the margin hit occurs during their next conf call (due to the margin on the tablet being a negative number) AMZN will have to do something as they are going to be severely punished if they don’t.  Also in time when the general public has had time to digest the use of their AMZN tablet, the euphoria will calm down and the reality of daily use will take over.  Basically you have a tablet that is good for reading books, watching AMZN videos and listening to songs. However the ecosystem of apps is severely limited when compared to AAPL.  That’s reality.  I also believe the 7 inch screen will start to become an issue for many.

         
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    Posted: 29 November 2011 12:29 PM #17

    Apple isn?t the one that should be worried. It is HP, RIM, Samsung & etc. They are already at a disadvantage with everything Apple?s pads/tablets have to offer and they have to price themselves below Apple to compete and Apple learnt its lessons in developing the iPod and the iPhone. The iPod had to pay for its development from the start and, from habit, the iPhone was made to do the same. iPad family development was well underway and paid for by the first two endeavours and that is why it isn?t closer to four digits, price wise.

    The budget minded and those with simpler needs are covered well enough by the Kindle Fire and the price step from Fire to what the others have to offer is not as steep as the jump to the cheapest Apple iPad. As well, some will choose to get the Fire for Christmas to tide them over till the iPad 3 comes out. The Fire is also as cheap or cheaper than the first eReaders from a year or so ago, so Kindle offers a market for people not ready to invest more than a couple of hundred bucks in this new field of tablet computers.

    Apple will keep its strong lead, whilst HP et al. will be caught between those preverbal hard bits and the Kindle will fill a niche and be more enticing to those who have already experienced the headaches of Android iPhones, which iPad sales is already proving. There are a lot of sores from the majority of Android creatures to make the customer leery in this newest mobile market.

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    Posted: 29 November 2011 12:42 PM #18

    One question: except for the awful placement of the power button, can’t most of the rest of the complaints be fixed via software updates?

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    Posted: 29 November 2011 01:09 PM #19

    Gotta love Andy Ihnatko, speaking on kids who want an iPad for Christmas: “The Fire is going to be the gift a lot of kids get from well-meaning but technologically naive aunties—‘See, I got you one of those iPad thingies.’ “

         
  • Posted: 29 November 2011 05:13 PM #20

    iOSWeekly - 29 November 2011 02:47 AM
    capablanca - 29 November 2011 12:03 AM

    Potato chips, bath towels, and snow shovels also outsold iPad, but numbers were not revealed.

    I don’t know of many Potato Chips, Bath Towels or Snow Shovels that have multi-touch screens and that browse the web, run apps, play media & let you download content from an integrated store.

    If you are trying to imply that the Kindle Fire & iPad are in completely different product categories - then you really need to reconsider your position.

    I think his point is that without reported unit sales numbers we have no basis for competitive comparison. Neither AMZN, nor BN, have reported units SOLD, making any discussions regarding the success of their products meaningless.

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  • Posted: 29 November 2011 06:24 PM #21

    And now at Best Buy:

    http://seekingalpha.com/article/310811-the-kindle-fire-bests-the-ipad-at-best-buy?source=yahoo

         
  • Posted: 29 November 2011 07:15 PM #22

    I’ll be curious to see what the return rate for all these fires will be….my guess is in the 15%-20% range

    Even if it’s only 10% imagine the indigestion Amazon is going to be feeling.

         
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    Posted: 29 November 2011 07:16 PM #23

    Oh boy.

    It’s all over now.

    Apple should just shut itself down and give all the money to its shareholders.

    With the understanding that Amazon will probably sell millions of Kindle Fires this generation (how many, Amazon may not say), we’re talking Apples and oranges.

    8-month old Apple tablet available anywhere.  Versus $300 cheaper, new, ultra-hyped tablet from Amazon being heavily promoted everywhere, and likely given a much stronger sales push at storefronts where Apple competes but doesn’t care as much (Target, Best Buy, Radio Shack, etc.)

    Ask yourself this:  Will the Kindle Fire outsell the iPad 2 based on limited sales data from Target and Best Buy?  Can you even undertake this analysis before the Kindle Fire has a full quarter of sales?

    [ Edited: 29 November 2011 07:25 PM by Mav ]

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  • Posted: 29 November 2011 07:18 PM #24

    I still can’t help but wonder what Apple could build a 7” iPad for. Given their economies of scale on the 10” iPad I suspect they could make money on a 7” iPad at under $300.

         
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    Posted: 29 November 2011 07:24 PM #25

    Steve Jobs may have denied it but no question that Apple had always kept a close eye on the 7” tablet form factor space.  The question is, if a 10” screen is too big for smartphone apps and a 7” screen is too small for tablet apps, where will the 7” tablet have a purpose?

    Also note Apple’s product matrix.  Excepting iPhone, the iPod touch is at $399 and the iPad is at $499.  Stuff like a $299 iPad nano or $299 carryover iPad 2 when iPad 3 comes out sounds great and all.  But does it make sense in the context of Apple’s pricing structure?  It’s not a trivial question.

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    Posted: 29 November 2011 08:22 PM #26

    RonMacGuy - 29 November 2011 11:18 PM

    I still can’t help but wonder what Apple could build a 7” iPad for. Given their economies of scale on the 10” iPad I suspect they could make money on a 7” iPad at under $300.

    Currently, iOS devices have 3.5” and 9.7” displays.  You’re suggesting introducing another display size?  For each display size, developers have to recompile the codes esp the graphics for that size.  Given that developers won’t get any $ for the effort for existing apps, only get $ for new apps & need to do for three instead of two display sizes, the incentive to do so is not that good.  Better to adjust the current price structure.

    iPod touch 8GB for $199, 32GB for $299 and 64GB for $399
    iPad Wifi 16GB for $499, 32GB for $599 and 64GB for $699

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  • Posted: 29 November 2011 09:08 PM #27

    Mace - 30 November 2011 12:22 AM

    Better to adjust the current price structure.

    iPod touch 8GB for $199, 32GB for $299 and 64GB for $399
    iPad Wifi 16GB for $499, 32GB for $599 and 64GB for $699

    I’d drop the 64GB iPod touch for an iPad 2 16GB at $399 (with current display technology).  Then I’d price the iPod touch as follows:
    16 GB @ $249
    32 GB @ $299

    iPad 3 value in is a better processor (A6?), better display (?), front and rear facing cameras (?).

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  • Posted: 30 November 2011 07:28 AM #28

    2 Cents - 29 November 2011 10:24 PM

    And now at Best Buy:

    http://seekingalpha.com/article/310811-the-kindle-fire-bests-the-ipad-at-best-buy?source=yahoo

    This does not seem trivial.  One could argue the Kindle is a nice size.  I agree the iPad is far better, but is the Kindle enough for many people?  Will they grow to dislike it?  Does the market for one help the other?

    I think only time will give a clear answer.  My guess is that by February we will know.

         
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    Posted: 30 November 2011 11:35 AM #29

    I had a nice visit with staff at the Bellevue Washington Apple store yesterday. 

    One salesperson told me she, individually, sold 40 iPads on black Friday. She was not assigned to the iPad table, just walking around. She did not think she was unusual as regards her cohorts on that day.

    I think iPad will do o.k. this holiday season.

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  • Posted: 30 November 2011 03:27 PM #30

    hledgard - 30 November 2011 11:28 AM
    2 Cents - 29 November 2011 10:24 PM

    And now at Best Buy:

    http://seekingalpha.com/article/310811-the-kindle-fire-bests-the-ipad-at-best-buy?source=yahoo

    This does not seem trivial.  One could argue the Kindle is a nice size.  I agree the iPad is far better, but is the Kindle enough for many people?

      Obviously it is for some.

    Will they grow to dislike it?

    Some will.

    Does the market for one help the other?

    The only reason people buy down is economic, that means that the Kindle will aid future sales of the iPad as people move up, but not vice versa.

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