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Ticonderoga notes Kindle Fire targets different market than Apple's iPad 2

post #1 of 44
Thread Starter 
A note issued Brian White of Ticonderoga Securities says there is a market for Amazon's new Android based color Kindle Fire model, but that it is "not the market that Apple is addressing."

White wrote that "while Amazon's price point, installed base, digital content and cloud ecosystem will attract a certain consumer demographic to the Kindle Fire, there is still no real competitor to the iPad 2, in our view."

Instead, the analyst stated, "essentially, we believe the Kindle Fire addresses a different market than the iPad 2, a tablet-light user on a tight budget that may not have yet purchased a tablet or already use a Kindle."

While half the price of Apple's tablet, the Kindle Fire "lacks the enhanced capabilities, aesthetics, power and rich features found on the iPad 2," White said.



"We find the 7-inch screen too small for a tablet device as Steve Jobs has previously highlighted, while the lack of a 3G connection will keep consumers confined to a Wi-Fi world. We believe Apple's long history as both a hardware and software company will continue to drive greater technological innovation in the tablet market versus Amazon. Also, the aesthetics of the Kindle Fire seem tired to us and clearly pale in comparison with the iPad 2."
post #2 of 44
If I was unfortunate enough to have been in a chainsaw accident and I happened to lose 8 of my fingers, I just might consider the Amazon tablet, seeing that it's only two point multitouch.
post #3 of 44
At "under $100" budget, that is the way to go. Quite frankly, I would have one of those, save that I already have an iPad. That is a market that Apple is definitely not going for, and where they will probably succeed. I still remember my wife and I talking about it, and one of those might solve her needs for a "digital book reader" much better than the previous models.

Ditching the physical keyboard is also a +++ in my opinion. The product is finally mature enough.
post #4 of 44
While I own an iPad and think it is a great device - I think the condescension at the end of his statement - "tired" might be missing the mark...

This device has a different demographic - and for what that demographic wants - this item is far from "tired" - it is a quality device at a great price.

They will sell millions.


If you are looking to this person for investment advice - you stand to lose money.

He is like the broker who "Could have made me a millionaire! .....If I had started with 10 million!"
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post #5 of 44
"While half the price of Apple's tablet..."

'Nuff said.

There's no doubt that Apple's hardware is better. But they will compete against one another, and at that price point the Fire will be "good enough" for a lot of people.

Everyone does the iPad comparison, but to my mind the people who just got really screwed are Samsung, HTC, RIM, and the like.

There's Apple, now there's Amazon, and then there's everyone else...
post #6 of 44
I can't imagine it's going to be much fun watching a tv show or film on the 7" screen, although I can see a lot of parents buying one for their kids just because it's cheap.

So far none of the 7" tablets have sold well. I wonder if this will be any different.

I hope Apple come back fighting with a radical new iPod Touch but I'm not holding my breath.
post #7 of 44
Analyst: $199 device less functional than $629 device, targets different market.

Well no ****, Sherlock.

Where can I get a job coming up with this stuff?
post #8 of 44
Quote:
Originally Posted by Shaun, UK View Post

I can't imagine it's going to be much fun watching a tv show or film on the 7" screen, although I can see a lot of parents buying one for their kids just because it's cheap.

So far none of the 7" tablets have sold well. I wonder if this will be any different.

I hope Apple come back fighting with a radical new iPod Touch but I'm not holding my breath.

I wouldn't even bother to watch a movie on my 9.7" iPad and I think that many people don't know this, but 7" is less than half the size of an iPad. It's tiny in comparison.
post #9 of 44
Quote:
Originally Posted by Ivabign View Post

While I own an iPad and think it is a great device - I think the condescension at the end of his statement - "tired" might be missing the mark...

This device has a different demographic - and for what that demographic wants - this item is far from "tired" - it is a quality device at a great price.

He's calling the esthetics "tired," not the hardware or quality. However, I do agree that he's being stubbornly dismissive. I have an iPad, but I'm going to buy one of these to see what the Kindle is all about, and just because it's so inexpensive. At $100 there is a market. Doesn't mean they can sustain it when selling at a loss, but there is a market. The only sad thing is that if Amazon fails, and you heard it here first, there will be a "Fire Sale"
post #10 of 44
I think Amazon has got it right. Instead of competing with iPad they are going for a niche area that they can do well. What they do is not for me but they are picking up a segment of the market and are trying to evolve their product there. I can respect that.
post #11 of 44
Total BS, the Fire competes directly with the iPad.
Web browsing, email, books, and video is what the iPad is known for. Apps are nice, but not always crucial thanks to cloud computing.
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post #12 of 44
Quote:
Originally Posted by Apple ][ View Post

I wouldn't even bother to watch a movie on my 9.7" iPad and I think that many people don't know this, but 7" is less than half the size of an iPad. It's tiny in comparison.

Agreed, it's tiny compared to the iPad. I had a play with the Samsung 7" Tab when it launched and was not impressed. Judging by the poor sales a lot of people obviously felt the same.

One of the reasons I bought the iPad was so I could watch videos while travelling and away from home and to be honest the 9.7" screen isn't half bad. It's comfortable to watch for extended periods. A retina screen would be even better for HD content but that's for the future.
post #13 of 44
Quote:
Originally Posted by Shaun, UK View Post

I can't imagine it's going to be much fun watching a tv show or film on the 7" screen, although I can see a lot of parents buying one for their kids just because it's cheap.

So far none of the 7" tablets have sold well. I wonder if this will be any different.

I hope Apple come back fighting with a radical new iPod Touch but I'm not holding my breath.

The 10 inch is coming (I'd guess after the new year).

While this 7 inch doesn't compete hard with the iPad - a 10 inch one will. Amazon has alot to deliver on first though.

ahmlco said it correctly - once this product is out there it will be Apple & Amazon (both with valid solutions) and everyone else (still thinking tablets should work like the pc marketplace)
post #14 of 44
Think of it as a more capable kindle rather than a less capable iPad. Millions bought smaller B&W kindles for $149 (less now). So add color, much broader media access and rudimentary browsing and $199 sounds pretty good. iPad is a larger and more fully capable computing device, putting it in a totally different market. Many are simply seeking portable media consumption and would never have spent $500 on iPad. I'm betting this will be a huge holiday hit. (disclaimer: i own neither kindle nor ipad because, with my MBAir, i can't see the value-added in either case.)
post #15 of 44
DED=FUD

I can smell it.
post #16 of 44
Quote:
Originally Posted by Sasparilla View Post

The 10 inch is coming (I'd guess after the new year).

While this 7 inch doesn't compete hard with the iPad - a 10 inch one will. Amazon has alot to deliver on first though.

ahmlco said it correctly - once this product is out there it will be Apple & Amazon (both with valid solutions) and everyone else (still thinking tablets should work like the pc marketplace)

In two years I see the tablet market broken down like.....

iPad with the most market share....say 40%
Kidle righ behind it
Windows 8 dominating 70+% of corporate tablets
Everything else based on some Google code.
post #17 of 44
Quote:
Originally Posted by posner View Post

Think of it as a more capable kindle rather than a less capable iPad. Millions bought smaller B&W kindles for $149 (less now). So add color, much broader media access and rudimentary browsing and $199 sounds pretty good. iPad is a larger and more fully capable computing device, putting it in a totally different market. Many are simply seeking portable media consumption and would never have spent $500 on iPad. I'm betting this will be a huge holiday hit. (disclaimer: i own neither kindle nor ipad because, with my MBAir, i can't see the value-added in either case.)

"rudimentary browsing"

???

It is based on webkit at its root, it supports flash and offloading to Amazon's servers....much like Opera does with its mobile browser.

Many people see the iPad as an expensive consumption device with no rival....until today.
post #18 of 44
His analysis seems pretty spot on. He isn't saying it'll flop, just that it doesn't pose a real threat to iPad. Sure it'll take some sales away from Apple during the holiday season, as it makes for a cheaper gift (I envisage a lot of disappointed recipients). It does look rather dated/tired ... far too thick, compared to the iPad or e-ink Kindles.

But as noted above, the people who should be really worried are the other hopefuls in the Android tablet scene.
post #19 of 44
hmmmm. I own a Kindle 3 3g and an iPad 2 wifi. I like my Kindle 3 because of the e-ink screen and it fits in my back pocket if I plan to go somewhere public alone and read. Now I could do that with my iPhone but reading a book on a smaller screen drives me nuts. Now with my iPad 2 I don't really bring it with me anywhere unless i'm traveling because it's too big, unless I go out and buy a manpurse. I really do like the size of the Kindle for home use when I don't feel like starting up my computer, but I think a 7inch tablet is more practical for public use though. With that all being said, I remember seeing a commercial where this guy was completely engrossed with his tablet on an airplane and it me think of how rude it will be when people are out in public walking around and just engrossed in their tablets ALL the time :-O It's already happened with smartphones but it's about to get a whole lot worse with these bigger devices!
post #20 of 44
While everyone argues whether a 7" tablet is large enough to watch a movie on - I would say look to the auto industry - 99% of the rear seat entertainment (OEM supplied) is at 7" or under. Now I know a couple of OEMs have moved to 9" - but it hasn't been a hindrance. And that is from a distance - not in your hand.

7" will work fine for most - kids definitely - this is the perfect kid tablet - if you can get some nice parental controls on it - the combination of price and performance can't be beat.
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post #21 of 44
1) This is a competitor to multimedia tablets.

2) The UI looks very smooth and refined in this video: http://gizmodo.com/5844742/video-of-...ction-up-close
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post #22 of 44
Quote:
Originally Posted by Sasparilla View Post

The 10 inch is coming (I'd guess after the new year).

While this 7 inch doesn't compete hard with the iPad - a 10 inch one will. Amazon has alot to deliver on first though.

ahmlco said it correctly - once this product is out there it will be Apple & Amazon (both with valid solutions) and everyone else (still thinking tablets should work like the pc marketplace)

I know what you're saying and I guess you're right but the iPad is so much more that a media player. It's basically a computer. I hope people realise that when they are making a decision. Even with a 10" screen the Kindle Fire won't be able to do all the things you can do on an iPad. It's not a "magical" product, it's just a cheap tablet for reading books and playing games. If I want a cheap eBook reader i'd rather buy the basic Kindle and if I want a portable handheld gaming device I'd rather buy a PS Vita.
post #23 of 44
AI:
"Amazon is making another failed iPad killer, hurr durr, slower than a Playbook"

* Amazon reveals Fire*
AI:
"different markets, hurr durr"


But seriously, I can see this becoming quite a competitor. Lots of people are going to get it just to jailbreak it and get unhindered Android, of course. 199 is awfully tempting.
post #24 of 44
Quote:
Originally Posted by Ivabign View Post

While everyone argues whether a 7" tablet is large enough to watch a movie on - I would say look to the auto industry - 99% of the rear seat entertainment (OEM supplied) is at 7" or under. Now I know a couple of OEMs have moved to 9" - but it hasn't been a hindrance. And that is from a distance - not in your hand.

7" will work fine for most - kids definitely - this is the perfect kid tablet - if you can get some nice parental controls on it - the combination of price and performance can't be beat.

If your video is 1:2.35 then a 7" 16:10 tablet compared to the 9.7" 4:3 iPad isn't much different on the x and y axes. It's 25.58" square for the iPad compared to 15.54" square for the Kindle Fire for a device with less than half the total display real estate. IOW, it's good enough for watching movies. For reading books I much prefer the 10" 4:3 display and fully expect Amazon to come out with a larger Kindle fire unless it completely bombs like other Android tablets before it.
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post #25 of 44
Quote:
Originally Posted by Apple ][ View Post


I wouldn't even bother to watch a movie on my 9.7" iPad and I think that many people don't know this, but 7" is less than half the size of an iPad. It's tiny in comparison.

Yes... it's tiny... but with a tiny price too

post #26 of 44
Quote:
Originally Posted by solipsism View Post

If your video is 1:2.35 then a 7" 16:10 tablet compared to the 9.7" 4:3 iPad isn't much different on the x and y axes. It's 25.58" square for the iPad compared to 15.54" square for the Kindle Fire for a device with less than half the total display real estate. IOW, it's good enough for watching movies.


And for 16:9 TV shows, the difference is even less.
post #27 of 44
Quote:
Originally Posted by kustardking View Post

He's calling the esthetics "tired," not the hardware or quality. However, I do agree that he's being stubbornly dismissive. I have an iPad, but I'm going to buy one of these to see what the Kindle is all about, and just because it's so inexpensive. At $100 there is a market. Doesn't mean they can sustain it when selling at a loss, but there is a market. The only sad thing is that if Amazon fails, and you heard it here first, there will be a "Fire Sale"

well, first, the hardware is in fact "tired" - it's actually a modified Playbook from the same Asian factory. to keep costs down obviously.

and second, it's aimed at the low end of the market, and the "tweener" size subset of that. Kia's compacts do not compete at all with BMW's sedans, even tho both sell "cars." we will see how big that market segment really proves to be in the next year or so. except for geeks and hobbyists, iPad buyers are not looking for cheap stuff. and there are hundreds of millions of upscale consumers around the world now, despite the hard times for everyone else. tablets are a discretionary purchase they can afford, not something essential like smartphones everyone needs to buy.

Apple still dominates the "mini" size tablet market subset, btw, with the iPod touch. what do you think 99% of kids would want for Xmas this year - a Kindle Fire or an iPod touch? (i think Apple would be smart to offer a larger 5.5" touch model too, which kids would totally love, but it probably never will).
post #28 of 44
the three big things most of the gushing blogsphere is missing (but some do see it) about the Fire are:

- the biggest early impact will be on all the competing 7" Android tabs from other OEM's. Amazon is undercutting their price even if it's taking a loss. the extra $80 annual "Prime" subscription ($160 over two years) is the hardware subsidy they don't have. this could become a bloodbath. and next year the full size Amazon tab may do the same thing to 10" Android tabs. the Ice Cream Android OS is their last hope to avoid this (where is it, btw?).

- Amazon is launching a direct assault on Google itself. where are the Google apps? what is the default browser search? how do the ads work? it's cloud vs. cloud, store vs. store. by nakedly ripping off Android from Google, Amazon poses a mortal danger to Google's aspirations.

- Amazon is creating a "walled garden" mostly-cloud/some-hardware ecosystem that is even more confining than Apple's mostly-hardware/some-cloud/plus lotsa-software ecosystem. why aren't all those "but it's open" fandroids scremaning about that?
post #29 of 44
Quote:
Originally Posted by Michael Scrip View Post

Yes... it's tiny... but with a tiny price too.

I know several women who'd probably love the Kindle's size as its something that's more easily thrown into a bag or purse.

The iPad is a wonderful device, but unless you always have a briefcase or backpack you have to make a conscious choice to carry it.
post #30 of 44
what do you mean different market?

everyone posting to blogs like this knows every spec difference between the two devices, but the VAST VAST VAST majority of iPad buyers don't care about ram or processor speed. they want "one of those cool new tablets that everyone is buying."

The Fire will get you on the web, allow you to watch movies, listen to music, check facebook and play angry birds... at half the price. I think it will be a huge success.

as for size, it's a portable. people are glad to give up screen size for portability.
if you don't believe me, look at the 11" MBA sales vs the 17" MBP.
post #31 of 44
Quote:
Originally Posted by ahmlco View Post


I know several women who'd probably love the Kindle's size as its something that's more easily thrown into a bag or purse.

The iPad is a wonderful device, but unless you always have a briefcase or backpack you have to make a conscious choice to carry it.

True... but anything bigger than a pocket requires a conscious choice to carry it. that includes laptops, old Kindles, etc.

Women have it easy... they have a purse with them all the time. Men? Not so much. I bet the Kindle Fire would fit in my back pocket.... but that's silly.

That's why I have a smartphone.
post #32 of 44
Except for one, small, tiny, itsy-bitsy, teeny-weeny quibble:
"Ships from and sold by Amazon Digital Services. U.S. only."
"Kindle Games & Active Content are currently only available to U.S. customers "
"Amazon Appstore is only available to customers located in the United States"
… my Kindle Graphite will have to suffice for a day or two more; a iPad 2 may provide some consolation.

Cheers
post #33 of 44
Another analyst who doesn't have a real clue about marketing and how products really fill consumer needs.

See my comment in the other thread about company's being willing to eat into their own existing market positions in order to introduce new products.

The reality is that the Kindle Fire will serve to block adoption of some significant number of new iPads at the lower price points, and then with the purchase of non-apple apps continue to be a roadblock to adoption of Apple's ecosystem
post #34 of 44
#

*

I am probably known as a great Apple booster (or to some even a helpless, hopeless fanboi). Yet I salute the Kindle Fire. It looks like a good, solid product, with a lot of appeal. Like any product it has its strengths and limitations.

I think that once again, as the Kindle simple before it, it will be both an additive as well as a competitive product. Together they will have both a symbiotic and cannibalistic relationship. The Kindle (simple) was supposed to have been squashed by the iPad, the clearly “superior” product. Yet (as I predicted when iPad was launched) Kindle actually soared, with a lot of help from the iPad. The reason was that the iPad “legitimized” eBooks, and gave them a lot of press. So for those who really only wanted to read, and wanted to keep down the cost, (or preferred the e-ink) the Kindle was the way to go.

On the other hand, I am sure there were lots of people who looked at the Kindle and said “Cool. But I really want to do these other things as well.” So they, who would never have looked at the iPad before, wound up buying one.

So, here too, I am sure that the Fire will take some business away from the iPad. But I really think most of its buyers wil be those who would never have bought an iPad (due to cost or anti-Apple philosophy), and, at the same time, it will continue to promote the tablet concept – which benefits BOTH devices.

Simple minded people are always looking at the “war on iPad” or for the ‘iPad KILLER.” Come on. Grow up. The iPad is not going to be “killed” by anything soon. A more mature view is to see the more complex relationships that really occur in the marketplace.
post #35 of 44
Quote:
Originally Posted by AppleInsider View Post

While half the price of Apple's tablet, the Kindle Fire "lacks the enhanced capabilities, aesthetics, power and rich features found on the iPad 2," White said.

Why do so many people think Apple's "one-size-fits-all" solution is the only good solution and that it meets everyone's requirements? Or that everyone needs all the "enhanced capabilities" of the iPad? The historical problem with Macs wan't so much that they were over-priced. It was that they were over-spec'd for what most people needed (both in terms of functionality and quality). For what you got, they were well priced. But most people didn't need it all.

The iPad is nearly capable of being a PC-replacement device for many people. But how many are actually using it that way, vs as a supplemental device? Not everyone cares about high-powered gaming apps and such that require all the power of an iPad. If you just want to surf the web, check your email, read a book, and play the occasional game of Angry Birds, the Kindle will meet your needs for a fraction of the price of an iPad.

Quote:
Originally Posted by Apple ][ View Post

I wouldn't even bother to watch a movie on my 9.7" iPad and I think that many people don't know this, but 7" is less than half the size of an iPad. It's tiny in comparison.

Maybe you wouldn't, but which would you rather hand a young child in the back seat of your car to watch a movie on the way to grandma's...an $800 iPad or a $200 Kindle? And would you care if said child had to watch the movie on a 7" screen vs a 9.7" screen? I'm pretty sure nobody would call Child Services to report you for child abuse if you gave them the Kindle.

And just as a nit to pick... don't forget about the aspect ratio differences. If you are watching a wide screen movie, you are wasting a lot more of your screen with letterboxing on the iPad than you are on the Kindle which looks to have a wider aspect ratio than the iPad. So 7 vs 9.7 isn't the true comparison in that case.
post #36 of 44
Quote:
Originally Posted by Wiggin View Post

And just as a nit to pick... don't forget about the aspect ratio differences. If you are watching a wide screen movie, you are wasting a lot more of your screen with letterboxing on the iPad than you are on the Kindle which looks to have a wider aspect ratio than the iPad. So 7 vs 9.7 isn't the true comparison in that case.

A letterboxed movie on an iPad is still physically larger than an entire 7" screen, it's a useless argument.

The only way your handing an iPad to a kid in the back of a vehicle argument makes ANY meaningful sense is if you sit them in the back of a pick-up truck on a pile of rocks, iPads are pretty tough especially when it comes to dropping them on carpeted surfaces.

This will get low spenders into Amazon's walled garden subsidising these things at the bottom of the market leaving Apple with the top.

Everyone else will be left competing for the vocal minority of geek users, which as has been shown by a string of flops so far, is hardly a sustainable market.
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post #37 of 44
Someone obviously has Apple stocks in its portfolio.

"Like I said before, share price will dip into the $400."  - 11/21/12 by Galbi

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post #38 of 44
Quote:
Originally Posted by solipsism View Post

1) This is a competitor to multimedia tablets.

2) The UI looks very smooth and refined in this video: http://gizmodo.com/5844742/video-of-...ction-up-close

Well, it looks OK. Kinda bare bones, and there doesn't seem to be much in the UI besides a straight cut to a new screen or moving across rows of icons. Transition and UI animations are held to a minimum and it doesn't look like it has autorotate.

For what it's intended for, it's fine, but anyone expecting to get a cheap, small iPad is going to be very disappointed.
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post #39 of 44
Quote:
Originally Posted by addabox View Post


Well, it looks OK. Kinda bare bones, and there doesn't seem to be much in the UI besides a straight cut to a new screen or moving across rows of icons. Transition and UI animations are held to a minimum and it doesn't look like it has autorotate.

For what it's intended for, it's fine, but anyone expecting to get a cheap, small iPad is going to be very disappointed.

Exactly.... they won't be getting an "it's just as good as the iPad but it only costs $199" tablet.
post #40 of 44
Not sure what I'd use it for with the 7 inch screen, my vision is not as good as it once was. Its thicker than the iPad, virtually no storage, and not useful for anything but browsing, reading and playing angry birds. Plus it runs that crap-o-la android system
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