New Amazon Tablet May Be First True Competitor to iPad
By IAN SHERR
======================================================
After more than a year of missteps by Apple Inc.'s tablet rivals, at least one viable competitor appears to have surfaced for the popular iPad.
Amazon.com Inc. on Monday trumpeted the success of its recently launched Kindle Fire tablet, part of a family of Kindle products that include low-priced e-readers. The company said it sold more than four times as many Kindle products on Black Friday last week as the same shopping day in 2010.
With Amazon's Kindle products selling at a rapid clip over the weekend, reporter Ian Sherr discusses just how much of a contender they'll prove to be in the fight for market share against the iPad.
The Seattle-based online retailer declined to provide precise figures, other than to say it had sold "millions" of its recently released Kindle tablets and e-readers even before the holiday shopping week, adding that the Fire, released this month and the first Kindle product with a color screen, has been its best-selling item for eight weeks.
As many as five million of the $199 Kindle Fires could be sold by the end of January, analysts at Forrester Research estimate, easily cementing the device as the second-place competitor to the iPad. About 13.5 million iPads are likely to be sold during the holiday quarter, estimated Gene Munster, an analyst with Piper Jaffray.
Another device that evolved from the e-reader market, the $249 Nook Tablet from Barnes & Noble Inc., also appears to be generating customer interest, said Sarah Rotman Epps, an analyst with Forrester Research. She believes the showing of the two companies suggests the tablet market has room for more than one strong brand.
"Today, the tablet market resembles the MP3-player market," Ms. Epps said, a reference to the fact that Apple's iPod has controlled roughly three-quarters of the market for digital-music players for years. "With Amazon and Barnes & Noble, you have brands that can be competitive," if on a smaller scale than Apple.
Jamie Iannone, the head of digital products at Barnes & Noble, said he believes customers are attracted to the company's books, apps and movies, noting that many other cheap tablets have existed for the past year without much success. "It's not about being inexpensive, it's about value," he said.
Enlarge Image
Reuters
A shopper viewed tablets at a Framingham, Mass., Best Buy on Friday.
Apple declined to comment.
The experience of the two competitors marks a turn for a business that Apple has thoroughly dominated since releasing the iPad last year. All manner of competitors, from Hewlett-Packard Co. to Research in Motion Ltd. to Motorola Mobility Holdings Inc., have since launched competing products with much fanfare but littlecommercial success.
Amid the new competition,Motorola and RIM have dropped the price of their respective Xoom and PlayBook tablets to $199 during the holidays. The devices originally retailed for $799 and $499, respectively, when they were released earlier this year. Motorola said its price cut was consistent with holiday-sales activities, saying its Xoom offers a combination of features other tablets don't have, such as a higher quality camera and a slot for additional memory.
RIM, as well, said its price cut was part of holiday promotions, an effort that a Best Buy Co. spokesman said has been greeted "very positively" by customers. "As a result, we are currently sold out of our inventory," he said, though he expects to have additional units to sell soon under the promotion.
H-P, on the other hand, announced plans in August to discontinue its TouchPad tablet, citing disappointing sales. It later dropped the price to $99, sparking long lines of eager customersat electronics retailers hoping to snap up remaining inventory.
A key factor in the battle, analysts say, is the push provided by online services that dispense apps and content to the tablets, typified by Apple's online store. Analysts say Amazon and Barnes & Noble are emulating Apple's strategy by emphasizing their devices' connections to online collections of downloadable material. By comparison, most other tablet makers are mainly focusing on simply selling hardware.
Tim Bajarin, an analyst at Creative Strategies, noted that the many companies making devices running Google Inc.'s Android operating system have tended to confuse customers and not produce a comparable online-store experience.
With Amazon and Barnes & Noble, which run customized versions of Android, there is a single device and "there's no confusion," he said.
Google declined to comment.
The growing success of Amazon and Barnes & Noble's devices also underscores one of the iPad's biggest competitive weaknesses: sticker price. The iPad, which costs $499 for the entry-level model, is more than twice the cost of the Kindle Fire. That has captured the attention of price-conscious customers, analysts say.
"Apple's products are priced at the high end, and not everyone can afford that," said Brian Marshall, an analyst with ISI Group. He expects holiday tablet sales to represent a barbell, with strong sales of iPad at the high end, strong sales of the Kindle Fire on the low end, and relatively poor sales for everyone else in the middle.
"Ultimately, we have yet to see how big the tablet market can be," Mr. Marshall added. But, he said, the Kindle "is at a price that can, if you'll excuse the pun, catch fire."—Stu Woo and Miguel Bustillo contributed to this article.
By IAN SHERR
======================================================
After more than a year of missteps by Apple Inc.'s tablet rivals, at least one viable competitor appears to have surfaced for the popular iPad.
Amazon.com Inc. on Monday trumpeted the success of its recently launched Kindle Fire tablet, part of a family of Kindle products that include low-priced e-readers. The company said it sold more than four times as many Kindle products on Black Friday last week as the same shopping day in 2010.
With Amazon's Kindle products selling at a rapid clip over the weekend, reporter Ian Sherr discusses just how much of a contender they'll prove to be in the fight for market share against the iPad.
The Seattle-based online retailer declined to provide precise figures, other than to say it had sold "millions" of its recently released Kindle tablets and e-readers even before the holiday shopping week, adding that the Fire, released this month and the first Kindle product with a color screen, has been its best-selling item for eight weeks.
As many as five million of the $199 Kindle Fires could be sold by the end of January, analysts at Forrester Research estimate, easily cementing the device as the second-place competitor to the iPad. About 13.5 million iPads are likely to be sold during the holiday quarter, estimated Gene Munster, an analyst with Piper Jaffray.
Another device that evolved from the e-reader market, the $249 Nook Tablet from Barnes & Noble Inc., also appears to be generating customer interest, said Sarah Rotman Epps, an analyst with Forrester Research. She believes the showing of the two companies suggests the tablet market has room for more than one strong brand.
"Today, the tablet market resembles the MP3-player market," Ms. Epps said, a reference to the fact that Apple's iPod has controlled roughly three-quarters of the market for digital-music players for years. "With Amazon and Barnes & Noble, you have brands that can be competitive," if on a smaller scale than Apple.
Jamie Iannone, the head of digital products at Barnes & Noble, said he believes customers are attracted to the company's books, apps and movies, noting that many other cheap tablets have existed for the past year without much success. "It's not about being inexpensive, it's about value," he said.
Enlarge Image
ReutersA shopper viewed tablets at a Framingham, Mass., Best Buy on Friday.
Apple declined to comment.
The experience of the two competitors marks a turn for a business that Apple has thoroughly dominated since releasing the iPad last year. All manner of competitors, from Hewlett-Packard Co. to Research in Motion Ltd. to Motorola Mobility Holdings Inc., have since launched competing products with much fanfare but littlecommercial success.
Amid the new competition,Motorola and RIM have dropped the price of their respective Xoom and PlayBook tablets to $199 during the holidays. The devices originally retailed for $799 and $499, respectively, when they were released earlier this year. Motorola said its price cut was consistent with holiday-sales activities, saying its Xoom offers a combination of features other tablets don't have, such as a higher quality camera and a slot for additional memory.
RIM, as well, said its price cut was part of holiday promotions, an effort that a Best Buy Co. spokesman said has been greeted "very positively" by customers. "As a result, we are currently sold out of our inventory," he said, though he expects to have additional units to sell soon under the promotion.
H-P, on the other hand, announced plans in August to discontinue its TouchPad tablet, citing disappointing sales. It later dropped the price to $99, sparking long lines of eager customersat electronics retailers hoping to snap up remaining inventory.
A key factor in the battle, analysts say, is the push provided by online services that dispense apps and content to the tablets, typified by Apple's online store. Analysts say Amazon and Barnes & Noble are emulating Apple's strategy by emphasizing their devices' connections to online collections of downloadable material. By comparison, most other tablet makers are mainly focusing on simply selling hardware.
Tim Bajarin, an analyst at Creative Strategies, noted that the many companies making devices running Google Inc.'s Android operating system have tended to confuse customers and not produce a comparable online-store experience.
With Amazon and Barnes & Noble, which run customized versions of Android, there is a single device and "there's no confusion," he said.
Google declined to comment.
The growing success of Amazon and Barnes & Noble's devices also underscores one of the iPad's biggest competitive weaknesses: sticker price. The iPad, which costs $499 for the entry-level model, is more than twice the cost of the Kindle Fire. That has captured the attention of price-conscious customers, analysts say.
"Apple's products are priced at the high end, and not everyone can afford that," said Brian Marshall, an analyst with ISI Group. He expects holiday tablet sales to represent a barbell, with strong sales of iPad at the high end, strong sales of the Kindle Fire on the low end, and relatively poor sales for everyone else in the middle.
"Ultimately, we have yet to see how big the tablet market can be," Mr. Marshall added. But, he said, the Kindle "is at a price that can, if you'll excuse the pun, catch fire."—Stu Woo and Miguel Bustillo contributed to this article.
======================================================
No comments:
Post a Comment