Kindle Fire Outsells iPad at Target

  • Posted: 02 December 2011 11:54 PM #31

    BillH - 29 November 2011 05:52 AM

    First and foremost I agree with what Mav just posted.  The way I’ve been viewing the Kindle products (and all android products for the most part) is that they’re basically gateway drugs to Apple.  People may buy them initially but grow dissatisfied with their limited function or substandard performance and quite often level of service.  They see the value in the approach and that is what motivates them to finally try an Apple product.  At that point (to date) it’s game over and they slowly move to the other products that Apple has to offer.  Again I will ask…,has anybody ever been to an Amazon genius bar?

    Tim Cook says more or less the same thing to an analyst from JP Morgan here.I’m not quite satisfied with the answers given regarding Apple’s use of cash but realize Tim couldn’t really answer any differently at this point in time.

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    Posted: 03 December 2011 12:17 PM #32

    PED ask the great question….just how many of those kindle fires are being returned.

    http://tech.fortune.cnn.com/2011/12/03/how-many-kindle-fires-are-being-returned-to-amazon/

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  • Posted: 03 December 2011 12:26 PM #33

    Red Shirted Ensign - 03 December 2011 04:17 PM

    PED ask the great question….just how many of those kindle fires are being returned.

    http://tech.fortune.cnn.com/2011/12/03/how-many-kindle-fires-are-being-returned-to-amazon/

    In true Amazon “can-do-no-wrong” fashion, we won’t learn how many Kindles were returned from the mouth of Jeff Bezos.  And Wall Street will respond accordingly and bump its P/E 10 points.  rolleyes

         
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    Posted: 03 December 2011 01:10 PM #34

    I think we should all pray that they sell millions of these babies.  The less that are returned the more losses Amazon will entail. Then sooner will Amazon kill the Fire and sell it at $100 a piece just to get rid of them.

    I want 10 million new Fire Owners to realize in 2 years that the iPad will be their next tablet.  They never would have considered an iPad at $500, but in 2 years they will.

         
  • Posted: 03 December 2011 01:15 PM #35

    Mercel - 03 December 2011 04:26 PM
    Red Shirted Ensign - 03 December 2011 04:17 PM

    PED ask the great question….just how many of those kindle fires are being returned.

    http://tech.fortune.cnn.com/2011/12/03/how-many-kindle-fires-are-being-returned-to-amazon/

    In true Amazon “can-do-no-wrong” fashion, we won’t learn how many Kindles were returned from the mouth of Jeff Bezos.  And Wall Street will respond accordingly and bump its P/E 10 points.  rolleyes

    Too true.  I would love to know the backstory and inner-workings of how Amazon will guard this number.  They’ve certainly had practice hiding the Kindle sales numbers. 

    I believe the Kindle sales numbers themselves are nothing to be ashamed of.  But there’s something about the related claims (best selling device on Amazon) that was a misrepresentation from the beginning, and quickly became too big of a lie to undo.  No proof, but no other explanation makes as much sense to me.

         
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    Posted: 04 December 2011 02:22 AM #36

    omacvi - 03 December 2011 05:10 PM

    I think we should all pray that they sell millions of these babies.  The less that are returned the more losses Amazon will entail. Then sooner will Amazon kill the Fire and sell it at $100 a piece just to get rid of them.

    I want 10 million new Fire Owners to realize in 2 years that the iPad will be their next tablet.  They never would have considered an iPad at $500, but in 2 years they will.

    If the cheapest iPad in 2 years is still $500, then apples marketshare will be tiny.

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    Posted: 04 December 2011 02:39 AM #37

    iOSWeekly - 04 December 2011 06:22 AM
    omacvi - 03 December 2011 05:10 PM

    I think we should all pray that they sell millions of these babies.  The less that are returned the more losses Amazon will entail. Then sooner will Amazon kill the Fire and sell it at $100 a piece just to get rid of them.

    I want 10 million new Fire Owners to realize in 2 years that the iPad will be their next tablet.  They never would have considered an iPad at $500, but in 2 years they will.

    If the cheapest iPad in 2 years is still $500, then apples marketshare will be tiny.

    I just don’t see Apple being forced to discount the iPad much.  $100 is the most for limited time of older models.

         
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    Posted: 04 December 2011 03:17 AM #38

    iOSWeekly - 04 December 2011 06:22 AM
    omacvi - 03 December 2011 05:10 PM

    I think we should all pray that they sell millions of these babies.  The less that are returned the more losses Amazon will entail. Then sooner will Amazon kill the Fire and sell it at $100 a piece just to get rid of them.

    I want 10 million new Fire Owners to realize in 2 years that the iPad will be their next tablet.  They never would have considered an iPad at $500, but in 2 years they will.

    If the cheapest iPad in 2 years is still $500, then apples marketshare will be tiny.

    The same way Macs’ marketshare is?

    I wouldn’t be so sure.  What’s wrong with a $500 computer that gets increasingly capable each year?  Not like cars get any cheaper over time.  Or printers, or many other electronic devices.  Value adding at the same price isn’t a bad thing.

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  • Posted: 04 December 2011 04:15 AM #39

    iOSWeekly - 04 December 2011 06:22 AM
    omacvi - 03 December 2011 05:10 PM

    I think we should all pray that they sell millions of these babies.  The less that are returned the more losses Amazon will entail. Then sooner will Amazon kill the Fire and sell it at $100 a piece just to get rid of them.

    I want 10 million new Fire Owners to realize in 2 years that the iPad will be their next tablet.  They never would have considered an iPad at $500, but in 2 years they will.

    If the cheapest iPad in 2 years is still $500, then apples marketshare will be tiny.

    Apple, like any other manufacturer with a successful product, will protect that product’s price by increasing utility.  The only people that discount products are going for volume with a 2nd tier, low margin product.

    Given how difficult it has been for manufacturers to duplicate iPad functionality and quality, at the iPad’s price points, I’d hazard that the iPad’s price is very low to begin with.

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    Posted: 04 December 2011 04:51 PM #40

    omacvi - 03 December 2011 05:10 PM

    I think we should all pray that they sell millions of these babies.  The less that are returned the more losses Amazon will entail.

    Well said.  Because of Apple?s strategy of large volume of a few models, loss leader strategy like AMZN’s Kindle Fire doesn’t work since the loss would be huge, AMZN could be luring Apple into this loss trap.  Apple has to be careful about lowering price since once lowered is hard to increase and lower price could reduce product image, lowering to prevent price umbrella is ok.

    Edit:  Agree with you that Apple would at most reduce iPad 2 WiFi price by $100 when iPad 3 is out.  However, Apple has the option of selling iPad 1 WiFi for $299 if there is a sufficient big market to suck air out of competitors trying to survive under the price umbrella.  The probability of that happening could be small as it would present too much choices to customers, iPod touch 32GB/64GB or iPad 1/2?

    [ Edited: 04 December 2011 04:59 PM by Mace ]

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    Posted: 04 December 2011 05:19 PM #41

    Mace - 04 December 2011 08:51 PM

    AMZN could be luring Apple into this loss trap.  Apple has to be careful about lowering price since once lowered is hard to increase and lower price could reduce product image, lowering to prevent price umbrella is ok.

    _Trying_ to lure Apple, Mace.  Trying to.  I doubt it’ll work.

    The Living God of Operations isn’t likely to “fall” for anything from Amazon.  Apple is not Steve, as you’re well aware.  The Kindle Fire has yet to “grow up” (read:  enter the iPad screen size arena), there’s no 3G options, no camera, way too many software buttons…the Kindle Fire is just paving the way for the next-gen Kindle Fire.  It’s much too early to have to “respond” to Amazon and “responding” isn’t something Apple does much of anyway.  Skating to where the puck is going to be and all that.

    Apple has been careful about pricing since 1997.  And now, it has unprecedented control over pricing because of the massive scale of its operations, which, if a certain other competitor by the name of Samsung isn’t careful, may actually beat a giant conglomerate (like Samsung) by revenue within a few years (though of course Samsung lacks the same corporate focus and overall profitability by not being a pure tech play).

    Next year, competitors will feel the squeeze like never before.  Assuming a 2048x1536 screen is possible, once Apple gets iPad 3 out on the market, here comes the Disruption Locomotive once again.

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    Posted: 04 December 2011 07:18 PM #42

    [This post was removed because the moderators arbitrarily censor.]

    [ Edited: 08 January 2012 04:32 AM by the_dragonfly ]

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    Posted: 04 December 2011 07:25 PM #43

    Mav - 04 December 2011 07:17 AM
    iOSWeekly - 04 December 2011 06:22 AM
    omacvi - 03 December 2011 05:10 PM

    I think we should all pray that they sell millions of these babies.  The less that are returned the more losses Amazon will entail. Then sooner will Amazon kill the Fire and sell it at $100 a piece just to get rid of them.

    I want 10 million new Fire Owners to realize in 2 years that the iPad will be their next tablet.  They never would have considered an iPad at $500, but in 2 years they will.

    If the cheapest iPad in 2 years is still $500, then apples marketshare will be tiny.

    The same way Macs’ marketshare is?

    I wouldn’t be so sure.  What’s wrong with a $500 computer that gets increasingly capable each year?  Not like cars get any cheaper over time.  Or printers, or many other electronic devices.  Value adding at the same price isn’t a bad thing.

    I don’t want to butcher Horace’s theory on disruption due to my far inferior understanding of the subject, but I think one of the key ingredients of a situation whereby a market encumbent is disrupted is when a company tries to continually justify the price of its dominant product line by adding unnessecary bells & whistles that have limited extra value. It allows a new entrant to offer a product with the same basic funcitionaly at a much lower price and grab marketshare quickly.

    Luckily for us, Apple has shown time and again that it is willing to disrupt itself before someone else does it.

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    Posted: 04 December 2011 09:21 PM #44

    I went to Best Buy today to check out the Fire for myself.

    It is locked in the back of the reader section.  Not a good location.

    It is selling well based on the 10 minutes or so that I spent with it.  One person was buy a store opened model and the salesperson was telling the father if he is not happy he can return it and there would not be charged a restocking fee.

    Next I saw a brother and sister getting theirs.  They were talking about how much each would contribute and then the brother asked if they would have to pay money for the books.

    Obviously cost is everything to these folks.

    I played with it and my impressions are mixed.  If you have never touched an iPad before I think the Fire can do the job for those looking for a simple Tablet.

    The internet was very slow.  Not sure if it was the wifi in the store.

    Browsing was OK but I was not happy with the what appeared to be a slow but sped up scrolling and zooming.

    The Apps with it are very limited.  Sometimes I would touch them and nothing happened.  The weather app crashed when I opened it but worked the second time.

    I have to go thru three touches to change apps.  The video playback was the most disappointing.
    The quality of the trailer for Super 8 was awful. 

    The only feature that works well with the size was reading a book.  It is very simple and quite practical. However it lacks the smoothness and cover flow of reading a book like the iBooks App.

    Unless there are other major issues I am not sure there will be that many returned based on my initial observations.

         
  • Posted: 04 December 2011 10:04 PM #45

    Mace - 04 December 2011 08:51 PM

    AMZN could be luring Apple into this loss trap.

    You got it backwards.  Apple lured Amazon into a price trap.

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