Amazon sells 5.5 million Kindle Fires in Fourth Quarter 2012 – Apple iPad sales drop and plans January Press Event

Happy New Year to all my loyal Fans of my posts! If you can read this, then your tech spirit is still alive despite the lackluster showing of innovation at the CES (Computer Electronics Show) 2012AD, my early out-take on a year that is already set to be dominated by Apple iPhone, Apple iPad and Amazon Kindle Fire and smartphone (??) rumour news. But on to the news, folks!

The comments last year were encouraging and now this year is even more so for e-Readers, if the Sunday January 1st 2012AD article is to be believed. The article in our local Sunday Newspaper painted a picture of a device from a company that was not associated with Tech Products but is now popular with everyone, even Jamaicans.

Truly 2012 is set to be the Year of the e-Reader, as the Amazon Kindle Fire is off to a great start, and is all fired up, as my article asserted mildly, as the price of US$199 was indeed right as per my article Kindle Fire vs Nook Color and Apple iPad 2 – Despite the Specs the Price is Still Right

More importantly, my assertion that e-Readers and not Tablets would be doing all the gobbleing despite the stats of InStat as in my attack-dog piece InStat prediction that Tablets to Overtake e-Readers is off base and defense piece Amazon lights a Kindle Fire as a Gladiator worthy of the Apple iPad is now confirmed.

This as early signs of hard numbers to put clothes on nubile goddess set of assertions that the Apple iPad could possible be bested by the diminutive Amazon Kindle Fire in Amazon Kindle Fire vs the Apple iPad – The Stats Wars worth Reading About have apparently now leaked out.

All Things Digital, that plucky blog that brought you accurate news of the launch of the Apple iPad S (‘cause it liked that name better than “Apple iPad 2”) as penned in my article Apple iPad S – Apple Refresh on March 2 has now leaked preliminary estimates from a Barclays analyst Anthony DiClemente that estimates that 5.5 million Kindle Fire were sold during the Fourth Quarter of 2011AD.

But it’s this analysts other prognostications that may give Apple CEO something new to worry about. Barclays analyst Anthony DiClemente predicts the following:

  • Amazon will sell (18,400,000) eighteen million, four hundred thousand Kindle Fires in 2012, estimated to be nearly half of e-Reader Market.
  • Amazon’s Kindle Fire e-Reader by 2012AD will generate $3.9 billion per annum from Digital Purchases mainly via 1-click purchases by Amazon Prime Subscribers
  • Amazon will break even on Tablet Sales in 2014, with actual Kindle Fire sales racking up a decent $3.9 billion and Digital and Shipping Sales generating some $5.2 billion.

Good for me at this point to note that Amazon’s approach is basically the Razor Blade Strategy: sell a cheap low-cost curated Android Tablet at a slight loss of US$2.70 on each Amazon Kindle Fire according to analyst IHS iSuppli and makes most of its moolah from Digital and Online Shopping Sales.

This is slightly different from Apple, which primarily makes back the money from its Apple App Store as noted in my article Kindle Fire vs Nook Color and Apple iPad 2 – Despite the Specs the Price is Still Right.

Thus the obvious question ensues; how many of these estimated sales were actually people opting for the Amazon Kindle Fire in lieu of the pricier Apple iPad, their obvious competitor? With no official numbers available from Amazon or Apple (so secretive, eh?) one can only speculate and CNET’s Don Reisinger article throws another log under the pot to boil the Apple iPad in its own expensive stew.

Morgan Keegan analyst Tavis McCourt’s Apple iPad estimates for the Fourth Quarter of 2011AD suggests a dip in Apple iPad sales from sixteen million (16,000,000) to thirteen million (13,000,000), a possible credit to the Amazon Kindle Fire razor-thin pricing margin.

Quotes work best for me, so here is his penned words, quote: “We are lowering our unit shipment estimates for iPad in the [December] quarter from 16 million to 13 million. Based on data from Amazon, we believe the Amazon Fire likely sold 4 [million to] 5 million units this holiday season”.

Thanks to the foibles of set logic [6th form mathematics y’all), a logical overlap in sales would exist due to the fact most customers assume the Amazon Kindle Fire to be a scaled down Tablet.

Thus Morgan Keegan analyst Tavis McCourt next words are telling of the effect of the Amazon Kindle Fire on the Apple iPad: “We expect iPad revenues to generate 21.3 percent of revenues in the December quarter for Apple, up from 17.2 percent in the year-ago period, although down from 24.3 percent in the previous quarter”.

Simply put, he estimate that the Amazon Kindle took away “maybe 1 [million to] 2 million” iPad sales”, thus corroborating to some extent Amazon’s official published comments of making sales of one million (1,000,000) sales per week since launch.

Not bad for an e-Reader cum Tablet with lackluster specs but great pricing strategy as noted in my article Kindle Fire vs Nook Color and Apple iPad 2 – Despite the Specs the Price is Still Right.  And if this is not evidence enough that Apple is hurting, reports now circulating suggest that Apple may have a Press Event on January 2012 in New York focused primarily on the burgeoning Education Market and Book Publishing.

Apparently Apple’s CEO Tim Cook after seeing how Amazon has been able to achieve e-book sales that exceed even their traditional Hardcover book sales and the rampant piracy of e-books on e-Readers by cash-strapped College students as captured in my article Piracy and E-Books in a Tale of Two Cities realizes that there was always a burgeoning marker in Boo Publishing, specifically geared towards education.

So Apple iPad sales may be hurting thanks to the e-Reader, which is now on a tear to take over from specs-laden Tablets. Poetic justice for lovers of books such as myself, as EMC3 lights a small Fire against the Apple iPad that may eventually rematerialize as a Blaze – hint at a possible name for Amazon’s much rumoured smartphone as per Kelroy’s article Amazon to give birth to family of Android devices?.

My personal take: Amazon Blaze smartphone on a two (2) year contract with a cheaper cloud-based smartphone, the Amazon Starfire to be purchased outright. Both scaled down versions of the Amazon Kindle Fire, a reverse on the Apple iPad scale up design from the Apple iPhone to expand on the growing importance of Digital content.

To be continued…….

The following two tabs change content below.
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.