Originally Posted by Shock Me
I think that is why the Fire will see some success because Amazon is skimming off the low end of people for whom the iPad is more capability than is needed. As far as consumption the only things it fails at are Magazines and comic books. It browses, it plays the more popular Android games that Amazon curates and chooses to sell, it gives you movies, TV and eBooks. That is a significant chunk of iPad usage right there.
I can see a parent buying an iPad for themselves and a Kindle or Kindle Fire for their children because it is "good enough" until they need an iPad for school textbooks or something like that.
Exactly. I see the Fire as being purchased by two groups of people:
1. People who would never have spent the $500-800 for an iPad, anyway, so the Fire does not impact iPad sales in this group.
2. People who already have an iPad and buy a Fire as a secondary device. This could have an impact on Apple's market share if they would have bought a second iPad, otherwise. Many of these people will eventually buy another iPad, anyway and some may be disappointed with the Fire because of its limitations. Or, they may be perfectly happy having a combination of devices.
Only time will tell the results from those different groups. In the end, though, I suspect that:
1. Kindle Fire will do well in terms of total sales. Given that its price is 40% of the low end iPad, there will be people who can live with its limitations.
2. Amazon will eventually increase the price (probably spring or summer when the v 2.0 comes out) to try to eke out some profitability after they've established themselves as a serious player.