Apple’s Ipad now has a strong competitor in the form of Amazon’s color tablet computer named Kindle Fire. With the high brand value of the Kindle brand which was rigorously built over three generations of its e-book readers and its capability to provide both music and videos, Amazon can expect a strategic advantage in the market. Complying with the present requirements Amazon has started offering downloadable music for sale and also have provisions for streaming videos. These two features when combined with the mobile application store provide Amazon an upper hand over its rivals.

Speaking about the USP of the product, editor of Stuff magazine, Mr. Will Findlater quips “It’s the price and the backup services that make it really exciting”, he continues “Content is the big differentiators. It’s what every other platform has been lacking, except the iPad.”

The device will be made available at $199 (£130) and will run a modified version of Google’s Android operating system. Although until now, the company has restricted itself to making black and white e-readers, designed for consuming books and magazines. With a direct hit at the Apple’s iPad market, Amazon is also likely to compete for market of rival bookseller US Barnes & Noble, who by the way already offers its users a color tablet.

However Adam Leach, an Ovum analyst expressed his concerns on the Amazons decision of smaller screen size. “This screen size has undoubtedly helped them achieve a lower price point for the device but so far this form factor has not been popular with consumers, we shall see if this is related to other aspects of those devices other than its screen size.” Amazon has opted for a 7 inch screen instead of the much favored and anticipated larger 10” which might prove to a shortcoming in the coming time.

Digital Dividend

Amazon has always given its due credit for the digital content to be a significant catalyst in attracting sales. Though the company never released the official sales figures for the Kindle, it did state – in December 2010 – that it was now selling more electronic copies of books than paper copies. And not just Amazon, even its arch US rival Barnes & Noble, has also enjoyed success with the digital content provided by its Nook devices. To cash in the sale, the company introduced Nook Color back in October, 2010. Nook color also runs a version of Android, but with lower hardware specs than many fully featured tablets. While the Nook Color is largely focused on book and magazine reading, some users have intelligently managed to unlock its wider functionality and have installed various third-party apps.

To make the devise look stylish and favor touch screen, Amazon offers Kindle Touch and has intelligently dropped the keyboard from some of its Kindles. The Kindle Fire’s $199 (£130) price tag will prove to beneficial as it significantly undercuts the Nook Color by $50 (£30) and is considerably more affordable than the more powerful tablets from Apple, Samsung, Motorola and others.

Wait for its release on 15 November in the US, although global release dates are not confirmed for now.

Price Cuts

Amazon has revised the prizes of the various devices and there have been some significant price cuts. Describing the same change Amazon Chief Executive, Mr. Jeff Bezos said “These are premium products at non premium prices; we are going to sell millions of these.” Along with Kindle Fire Amazon also proclaimed rejuvenation for its Kindle readers. The entry level device has effectively big adieus to its keyboard and will now be readily available for $79, down from $99. Amazon UK announced that the new version would retail at £89. A version with limited touch screen capability, known as the Kindle Touch, will sell for $99. Only the US pricing has been announced so far. With such significant price changes, let’s see how the big selling aspirations of the Amazon, fares out in market.