Amazon had high hopes for the Kindle Fire. Based on new global shipment figures, those expectations were met. According to analysis group IHS, the e-commerce giant's new tablet grabbed market share from the popular iPad, instantly earning the second place spot. Will its hot launch be enough to stoke a fire under Apple's pricey strategy?
Amazon will ship 3.9 million Kindle Fires through 2011, said IHS. While Apple should push nearly five times as many iPads this quarter alone, the Fire's launch success will earn it around 14 percent of the PC tablet market pie.
Samsung and HTC will hold the third and fifth place slots, respectively, IHS believes. The Nook Tablet, Barnes & Noble's first shot at the increasingly competitive market, is expected to squeeze into a fourth place finish.
It's the Kindle Fire, however, that will "light a fire" in the tablet market, explained IHS, upping its 2011 global shipment forecast by 4.7 million due in large part to the device's strong launch performance.
"Initial market response strongly suggests that Amazon, with the Kindle Fire, has found the right combination of savvy pricing, astute marketing, accessible content and an appropriate business model, positioning the Kindle Fire to appeal to a brand-new set of media tablet buyers," said Rhoda Alexander, senior manager, tablet and monitor research for IHS.
Alexander and co. believe Amazon's retail strategy - akin to giving away a razor and making money off blade sales - will pay off in dividends. The e-retailer will lose a little on every Kindle Fire sold, but make it back (and then some) through its successful online storefront.
Though Amazon's plan likely won't be fully embraced by Apple for its trailblazing iPad, the success of low-priced alternatives could force the company to reevaluate its pricing structure. So far, IHS only foresees an iPad 2 price cut once the iPad 3 hits stores sometime next year. But would a $250 iPad Mini be that much of a surprise?
Did you buy a Kindle Fire or Nook Tablet? Plan on picking one up in the next few weeks? Let us know in the comment section.
