Amazon recently announced a new addition to its Kindle tablet range, the seven inch Kindle Fire HD. With most tablets having screens in the region of nine to ten inches, the Kindle Fire’s clear competitor in the market is the Nexus 7. Amazon has enjoyed success with its Kindle e-readers but its presence within the tablet market is fairly marginal. One advantage offered by the Kindle Fire which could redress this low market share is the price: the Kindle Fire is significantly cheaper than rival tablets (just $199 in the US).
Google’s Nexus 7 was intended to provide a smaller, cheaper tablet alternative to compete against the iPad, and in fact the low price had been one of the most important aspects behind the design of the Google tablet. By undercutting Google in price Amazon may be able to get a firm footing in the low cost tablet market and completely eradicate any consumer desire for the Nexus.
At the official product launch, Amazon CEO Jeff Bezos stated that his company’s intention was to create a tablet that generates most of its profit throughout its lifecycle with continual consumer use, rather than at the initial point of sale, and this is why Amazon is able to provide an excellent tablet at such a low price. It will primarily achieve this through advertising.
In contrast, Google will make no more advertising revenue with the Nexus 7 than it does with any other Android device (including the Kindle), and Google achieves its low price tag by selling the tablet for less than it costs to manufacture. In other words, with every Nexus sold Google will lose money.
Much of the Kindle’s low price tag is supported by advertising. Android already features extensive advertising of course, used by app developers as one of many methods to generate revenue. Although Android users will already be familiar with adverts on their phones and tablets, the Kindle Fire’s advertising is a completely different kettle of fish.
Like Amazon’s e-readers the Kindle Fire comes with “special offers” adverts displayed on the screen when the device is put on standby. Amazon had originally stated that these adverts were not optional but has since bowed to public pressure and promised the option to remove the adverts for an additional fee.
Android, but not as we know it
Even with the extra $15 fee to remove adverts the Kindle Fire remains marginally cheaper than the Nexus 7. As the Kindle will also be producing a profit rather than a loss, like the Nexus, it also appears to be the better business strategy. But making a large corporation richer is not primarily what motivates people to buy products, and with a relatively small difference in price between the two devices success will rely on other factors.
Both tablets run on Android, unlike the upcoming iPad Mini (which may or may not be launched tomorrow alongside the iPhone 5), but the Nexus comes with the more up to date Jelly Bean compared to the Kindle’s Ice Cream Sandwich. Although you wouldn’t know it was Ice Cream Sandwich from looking at it – the Kindle has one of the most customised Android interfaces found on any Android phone or tablet, all heavily centred on Amazon products and services.
In contrast, the Nexus runs on a stock, “vanilla”, installation of Jelly Bean without any customisation. Although of course, Android is already heavily centred around Google’s products and services – and this is probably more true for Jelly Bean than any earlier version – so Google has no need to customise Android for its own benefit.
The Kindle will obviously appeal more to regular Amazon customers, while the Nexus will probably be favoured by Android aficionados and those less interested in reading and more interested in other aspects of tablet use.
Both use a 7 inch HD LCD screen and come with Wi-Fi and a front facing camera. The Nexus has a more powerful quad core 1.2GHz processor compared to the Kindle’s 1.2GHz dual core chip, although it only has 8GB internal storage compared to the Kindle’s 16GB. Likewise, Amazon claims about an extra hour of battery life and has stereo speakers but the Nexus benefits from NFC and GPS.
The curious thing about the Kindle Fire is that it does not come with a mains charger included, with default charging taking place via USB. Mains charging is possible but it requires the additional purchase of an Amazon Kindle PowerFast charger, yet again adding a little more cost to the deceptively low price of the tablet.
Perhaps Not as Cheap as it Seems
The Kindle Fire HD will go on sale towards the end of next month, by which time the Nexus 7 will have become well established in the market and Apple will have most likely released the iPad Mini. The Nexus 7 offers some hardware benefits over the Kindle and may be more attractive to people who are not Amazon customers due to its stock Android, but the Kindle does provide plenty of benefits itself – including its status as the cheapest tablet on the market. That single fact alone may be enough for many prospective tablet owners to become regular customers for Amazon. Just be aware that with the opt-out advertising and cost of accessories that are usually included as standard, the Kindle Fire HD may not be quite as cheap as you think it is.
This is a guest post by Simon from the UK phone comparison website best-mobile-contracts.co.uk