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Apple Welcomes Kindle Fire Tablet and More Android Fragmentation

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Apr 12, 2001
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Business Insider shares a portion of a research note issued today by Barclays analyst Ben Reitzes, who recently visited with Apple CEO Tim Cook and CFO Peter Oppenheimer in a meeting that included discussion of Amazon's new $199 Kindle Fire tablet based on Android.

kindle_fire_in_hand.jpg



According to the executives, Apple welcomes the entry of the Kindle Fire to the market for its ability to further fragment the Android ecosystem. While the Kindle Fire does utilize Android, it has been heavily modified by Amazon to integrate specifically with Amazon's products and services.
While the pricing at $199 looks disruptive for what seems to be the iPad's most important rising challenge, the Amazon Fire - it is important to note that it could fuel further fragmentation in the tablet market--given it represents yet another platform. While compatible with Android, the Apps work with Amazon products. The more fragmentation, the better, says Apple, since that could drive more consumers to the stable Apple platform.
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Reitzes notes that he believes Apple will eventually lower pricing on the iPad, but will not compromise on quality and customer experience to approach or match its competitors' pricing.

Apple and Amazon are approaching the tablet market from opposite perspectives, with Apple achieving significant profitability on the hardware while selling content and services at near break-even prices. Conversely, Amazon is said to be taking a loss on sales of the Kindle Fire, using the device to attract customers into its content and product ecosystem.

Article Link: Apple Welcomes Kindle Fire Tablet and More Android Fragmentation
 
Article Link
https://www.macrumors.com/2011/11/03/apple-welcomes-kindle-fire-tablet-and-more-android-fragmentation/
It's the argument I always make to android users. So many roms, so much fragmentation.
 
I see the Kindle as its own product and eco-system. Sure it runs Android, but I don't think of Android nor will most consumers - they'll just see Amazon (which is a winner for them).
 
I wouldn't consider this fragmentation. While that is a true problem of the Android ecosystem, the Kindle Fire isn't really Android in the sense most people would imagine. It's not designed to be a tablet computer, it's designed to be a handheld media player for Amazon content.

I'd imagine 90% of the people who buy this have no idea it has anything to do with Android.
 
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Why are they making it at a loss? Why not just push up prices?
 
Only thing is - the fire isn't trying to be the iPad.

And I don't think fragmentation plays into this at all.

The fire is a media consumption device - so as long as there's a good audio/video player + eReading software - most of the people buying it will be content. Sure there will be games and possible issues. But I think Apple is missing the mark on this product. I don't think anyone buying the Kindle is aware what software is on it - nor do they care. It's not the same as with phones where people want to know if they have 2.1, 2.3, etc on it (and to be honest - I think most of the general population doesn't care anyway). I know many people who have never updated their OS from the one that shipped with their phones. And I say that across the board whether they own iPhones or other devices.
 
I still look forward to the kindle fire. It will be my only android tablet. I got it because like the apple ecosystem I like the amazon ecosystem. I won't root or alter the way amazon set it up.
 
samcraig said:
Only thing is - the fire isn't trying to be the iPad.

And I don't think fragmentation plays into this at all.

The fire is a media consumption device - so as long as there's a good audio/video player + eReading software - most of the people buying it will be content. Sure there will be games and possible issues. But I think Apple is missing the mark on this product. I don't think anyone buying the Kindle is aware what software is on it - nor do they care. It's not the same as with phones where people want to know if they have 2.1, 2.3, etc on it (and to be honest - I think most of the general population doesn't care anyway). I know many people who have never updated their OS from the one that shipped with their phones. And I say that across the board whether they own iPhones or other devices.
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I see the Kindle Fire more as "Amazon's tablet" rather than Amazon's "Android" tablet.
 
Fazzy said:
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Why are they making it at a loss? Why not just push up prices?
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Who said they are making it at a loss? MR posters? Last I read - costs were about $150-$160 to make the device - so there was some profit being made.
 
wolfshades said:
Yup. It's a sort of "divide and conquer" observation. Google is clearly going the route that Microsoft went down - and Apple rightly applauds this.
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"Hey. Remember when those other guys did that thing we thought wasn't a good idea back in the day, and we totally got our asses kicked? Looks like the new guys are doing the same thing".

"ALLLLRRRRIIIGGGGHHHHTTTTT! HIGH FIVE!"
 
I for one am really happy to see a tablet at the $200 range, and I am also hoping for the sales to be really good, simply because it will means companies like Apple and Google will likely enter the budget market, especially if they want to keep that high marketshare..

Also gaming on a 7" Tablet is a lot more fun then a 9.7", I used to have an iPad but now am the owner of a Playbook, and I have to say that the 7" is particularly good when it comes to gaming.. Just much easier to manoeuvre..
 
Well If I'd buy a Kindle, I wouldn't see it as Android either, nor would I expect updates of any kind. It's Amazon, integrated with Amazon thingys.

I agree that Android is fragmentated, but here they're just taking an Android version as 'base' to build on in a seperate way.

Or is it meant to be upgraded every Android release?
 
Kindle Fire can be successful because it's not an "Android Tablet", it's a Kindle Fire. It's unique to Amazon and it is part of the successful and well-known Kindle product line. It just happens to run Android.
 
samcraig said:
...But I think Apple is missing the mark on this product....
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Oh yeah, because after all, what do people like Cook and Oppenheimer know about this stuff to have any idea what they are talking about?

And bear in mind that it's not as if 'fragmentation of the Android ecosystem' needs public awareness of the details of individual products - at all. It simply requires that the same market be served by increasing variance of products.
 
Actually, I think the Kindle Fire is going to do the opposite - it will give Android developers a specific SKU to develop or tailor their apps/games for. In fact, I think a lot of them will become 'Amazon Tablet Developers' instead of 'Android Developers'.

At that price, it's not exactly a stretch to say the Kindle Fire is will sell as fast as Amazon can make them, leading to a huge install base. With that I think you'll see a lot of developers taking full advantage of the benefits of known quantities (exactly what makes the iPad so popular, and the apps so 'smooth'). Knowing exactly what screen size/resolution, CPU speed, memory etc they're coding for makes a huge difference.

The Kindle Fire is the best thing to happen for Android in a long time, and the irony is, Google has no control over the product whatsoever.

The Verge has a great article on it.
 
Apple and Amazon are approaching the tablet market from opposite perspectives, with Apple achieving significant profitability on the hardware while selling content and services at near break-even prices.
Click to expand...

Sorry to go off topic, but this is why Apple wants to build and sell a TV!
 
I'm thinking that a large portion (not all) of those purchasing Kindle Fires wouldn't even know what "fragmentation" means in regards to the Android platform.
 
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Apple needs to find a way to get around the fact that if you ignore apps, the Kindle Fire does what the iPad does for $300 less in a much more portable form factor.

In other words, once the Kindle Fire gets upgraded to ICS to run any Android app possible (more specifically apps with a tablet-oriented UI), fragmentation won't matter. People will see the $200 price tag and buy away.
 
Fazzy said:
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Why are they making it at a loss? Why not just push up prices?
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They intend to make a profit from selling content. Their business model is the complete opposite of Apples who makes their profit on the products but doesn't make any substantial money on content-delivery.

Reitzes notes that he believes Apple will eventually lower pricing on the iPad, but will not compromise on quality and customer experience to approach or match its competitors' pricing.
Click to expand...
At the moment there's absolutely no reason for Apple to lower prices as they still are cheapest among every similar devices. And with Apples enormous advantage in supply-chain it could stay this way a long time. Apple has practically put every other manufacturer in a corner in the tabletmarket. Amaingly well executed really.
 
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