Amazon’s new cut price tablet to take on Apple

Amazon has unveiled possibly the biggest challenger yet to Apple’s iPad in the tablet market: the Kindle Fire.

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Watch Amazon’s advert for the Kindle Fire below

Amazon has unveiled possibly the biggest challenger yet to Apple’s iPad in the tablet market: the Kindle Fire.

The online retailer’s 7-inch tablet wi-fi only will cost $199 (£127) in the US, undercutting almost all of its new-found rivals in the market, including Apple, Samsung and RIM.

The device will only be available in the US at launch and may not roll out in other territories due to the fact that is linked to Amazon Cloud data storage service, which for legal reasons is not available outside the US. It can, however, be shipped to other countries from the US.

The Kindle Fire will operate an Android operating system, which will include a new web browser called Amazon Silk. The system allows users to sync all their e-books, music, video and other digital assets via a wireless service, with all content backed up for free on Amazon’s servers.

Speaking at the Kindle product launch, which also included other e-reader devices, Amazon chief executive Jeff Bezos says: “These are premium products at non-premium prices. We are going to sell millions of these.”

Amazon’s shares in pre-morning trading were up 3.5% following the tablet announcement. Barnes & Noble, Amazon’s biggest US competitor in the e-reader space, saw its shares drop 6.2%. Apple’s shares also took a slight hit, dipping 0.5%.

Forrester Research analyst Sarah Rotman Epps predicts Amazon will sell “millions” of tablets given its low entry price and that rapid adoption will give app developers a reason to develop Android apps over Apple.

“Apple’s place as market leader is secure, but Amazon will be a strong number two, and we expect no other serious tablet competitors until Windows 8 tablets launch,” she says.

Apple dominates Europe’s tablet market, with a 67.% share in the second quarter of 2011, according to IDC. Its closest competitor was Samsung, with 7% of the market.

https://www.youtube.com/watch?v=jUtmOApIslE

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Lucy Handley

Lucy Handley is a key member of the Marketing Week features team and has also worked in advertising agencies so can bring a unique perspective to client-agency relationships when writing on this topic.

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