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Amazon is Legally Blonde as the Kindle Fire HD Upgrade is CEO Bezos’s Confessions of an Online Shopaholic

The Amazon Kindle Fire launch on Thursday September 6th 2012 in Santa Monica, California got the major Press Release treatment on our blog by Chief Editor Kelroy in his article Amazon Introduces new Kindle Fire HD Family of Tablets.

Locally, as many Jamaicans with deep pockets ponder buying their little one the new Kindle Fire HD, ACS-Xerox, now called simply Xerox is a hive of busy training and preparation. This as since Sunday September 2nd 2012, they have begun their annual Ramp-up Campaign for the seasonal and (possibly year long!) increase in Amazon customer Calls for what CEO Jeff Bezos has declared is Amazon’s most successful product to date; The Amazon Kindle Fire! Back to back hell for CSA on the Amazon .com and Amazon.co.uk accounts

Amazon has now outed three (3) new Kindle Fires and a new revamped Kindle PaperWhite E-reader, all supporting HD Screens and boasting the following Specs:

7” Kindle Fire HD

  • 16GB for US$199
  • 32GB for US$249
  • 7.6″ x 5.4″ x 0.4″ (193 mm x 137 mm x 10.3 mm)
  • 13.9 ounces (395 grams)
  • High performance 1.2 GHz Dual-Core Texas Instruments OMAP 4470 Processor
  • PowerVR 3D graphics Processor
  • 1280×800 HD display with polarizing filter and anti-glare technology

8.9” Kindle Fire HD 

  • 16GB for US$299
  • 32GB for US$369
  • 9.4″ x 6.4″ x 0.35″ (240 mm x 164 mm x 8.8 mm)
  • 20 ounces (567 grams)
  • High performance 1.5 GHz Dual-Core Texas Instruments OMAP 4470 Processor
  • PowerVR 3D graphics Processor
  • 1920×1200 HD display with polarizing filter and anti-glare technology

8.9” Kindle Fire HD 4TE

  • 32GB for US$499
  • 64GB for US$599
  • 9.4″ x 6.4″ x 0.35″ (240 mm x 164 mm x 8.8 mm)
  • 20 ounces (575 grams)
  • High performance 1.5 GHz Dual-Core Texas Instruments OMAP 4470 Processor
  • PowerVR 3D graphics Processor
  • 4G LTE 10 band wireless modem with HSPA+, HSDPA, EDGE/GPRS fallback
  • Front facing HD Camera
  • 1920×1200 HD display with polarizing filter and anti-glare technology

Kindle PaperWhite

  • US$119 for Kindle PaperWhite Wi-Fi
  • US$179 for Kindle PaperWhite 3G
  • 6” 212 PPI PaperWhite Display optimized font technology, 16-level gray scale
  • Patented built-in light
  • 6.7″ x 4.6″ x 0.36″ (169 mm x 117 mm x 9.1 mm)
  • Weight 7.5 ounces (213 grams)
  • 2G GB internal, 1.25 GB reserved for user content

But despite the specs upgrade, which to the casual computer user are meaningless numbers from those mentioned for the Original Amazon Kindle Fire in my article Amazon Kindle Fire vs the Apple iPad – The Stats Wars worth Reading About and the gushing over the near-Retina Display Screen, Amazon’s CEO Jeff Bezos is sticking to the tried and Tested Model of the Tablet as an Online Shopaholics ultimate friend.

This as noted originally last year in Kindle Fire vs Nook Color & Apple iPad 2 – Despite the Specs the Price is Still Right, the Kindle is really a Portable Digital Storefront for Amazon. Amazon, by the way, lost US$2.70 off the sales of each Kindle Fire at its rock-bottom fire sale price of US$199.

Amazon CEO Jeff Bezos seems to think so, stating as much during the launch, quote: “We want to make money when people use our devices, not when they buy our devices”. However, undeniably, the specs on the new Amazon Kindle are squarely aimed at the Apple iPad, with CEO Jeff Bezos using the same delivery style as the late Marketing maven and Apple icon and CEO Steven Paul Jobs in a simple declaration, quote: “We want to have the best Tablet at any price”.

The logic seems compelling, as after all, it worked originally for Gillette, the Disposable Razor Company that first used what is now known as a Razor Blade Strategy: sell high-quality product dirt cheap and use it as a platform for the Bread-and-butter side of your business, be it sales of Accessories or access to something else.

And more recently, Amazon demonstrated that it did indeed work as noted in my article Amazon sells 5.5 million Kindle Fires in Fourth Quarter 2012 – Apple iPad sales drop and plans January Press Event. At their Earnings Call on Tuesday January 31st 2012, Amazon revealed the following numbers to its investors, which, depending on how you look at it, are an indication of the Amazon Kindle Fire’s success:

  • 41% Increase in 2011 earnings with earnings of US$631 million when compared to 2010
  • 35% Increase in the Fourth Quarter of 2011 with Earnings of US$177 million when compared to the Fourth Quarter in 2010

And the estimates for the size of the Tablet market this year just keep growing. Originally forecasted by Analyst ABI to hit the 100 million Tablets Served by the end of 2012 in a report published in August 2012, the numbers keep moving up. Now Analyst IDC in September has also upped their forecast from 107 million by the end of 2012 to 117 million. Number that no doubt will be much higher by the time the bean counters at these analytical firms re-work their math with actual sales figures.

But is there evidence to back up the idea of selling a Mobile Computer at fire-sale prices just to make more money from casual impulse-driven buying?

Forrester Research Analyst Rotman Epps seems to think so, as he bats for Amazon’s Razor Blade Model, quote: “Amazon‘s services are the core of its devices, and the devices enhance Amazon‘s service: a virtuous cycle where Amazon gains an increasing share of consumers’ wallets”.

Forrester recently did a poll earlier in the year that revealed the percentage of online shoppers that trust the registration of their Credit Cards to an Online Store:

  • 33% registered their credit card on an Amazon Account
  • 18% registered their credit card on an Apple Account
  • 5% registered their credit card on a Google Account

But it’s the stats of Javelin Strategy and Research that that may be the smoking gun as they strongly suggest that Tablet do indeed drive sales towards Online Shopping sites. In a study conducted via phone calls and online surveys, they uncovered the following:

  • $20.7 billion was spent on shopping through Mobile devices i.e. smartphones and Tablets
  • 25% of that amount, about US$5 billion, was spent via Tablets
  • Tablet users on average spend US$10 more than smartphones users in their Online Purchases

The results are easily explainable; Tablets, be they 7” to 10”, have a bigger screen, making shopping online that much easier. Coupled with Wi-Fi Support and 3G, the shop-anywhere couch potato trend is slowly being fostered by these Mobile Computing Devices. A factor that may also be driving the increasing popularity of the Apple iPad; a Tablet that has built in easy to use Online Shopping Services in the form of an App Store for Apps and ITunes for Music.

Executive Vice President and Research Director of Mobile at Javelin Mary Monahan thus has some advice for App Makers who are driving the App Economy which the Amazon Kindle helps to foster, quote: “Apps engage consumers to make purchases. With the upcoming holidays, retailers must prepare for the Mobile shopping trend or lose out on the opportunity to convert browsers into buyers.”

Clearly not only is their evidence from Amazon’s own Earning Call in January 2012 that suggests that Tablets are indeed driving Online Sales but now Third Party Research expresses a growing love for Online Shopping via this more convenient larger form-factor Screen, the Tablet.

So my advice in the article Smartphones and Apps – Freemium Games are No. 1for Jamaican Developers to make money from building Freemium Gaming Apps needs an adjustment to include Tablets as well.

Albeit smartphones are more ubiquitous, cheaper and slowly becoming more universal and popular in Jamaica as ruminated in Apple iPhone boosts Jamaican smartphone usage as BB goes Chapter 11 Bankruptcy, the Tablet simply has a bigger more comfortable Screen. And the market is set to grow each year, with no end in sight……

Thus despite the fanciful specs, which nobody cares about ‘cept those uber competitive types gunning for the Apple iPad, the HD and 4G LTE Upgrades touted by Amazon CEO Jeff Bezos is really set to give more shopaholics their daily fix of Credit Card Nirvana, Confessions of A Shopaholic (2009) Style!

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Lindsworth is a Radio Frequency and Generator Maintenance Technician who has a knack for writing about his work, which is in the Telecoms Engineering Field. An inspired writer on themes as diverse as Autonomous Ants simulations, Power from Lightning and the current Tablet Wars.

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