Amazon’s Kindle Fire tablet costs $209.63 to build,
according to an analysis by IHS iSuppli Teardown Analysis Service. That figure
includes $191.65 in materials in addition to manufacturing expenses.
Amazon plans on retailing the 7-inch tablet for $199.
“The real benefit of the Kindle Fire to Amazon will not be
in selling hardware or digital content,” read a Sept. 30 research note
accompanying the analysis. “Rather, the Kindle Fire, and the content demand it
stimulates, will serve to promote sales of the kinds of physical goods that
comprise the majority of Amazon’s business.”
That strategy could pay off for Amazon in the long run. “So
far, no retailer has managed to create an umbilical link between digital
content and a more conventional retail environment,” the note added. “With
Kindle, Amazon has created the most convincing attempt at this yet.”
In terms of hardware, the IHS iSuppli Teardown Analysis Team—which
plans on conducting a more exhaustive teardown once the tablet actually reaches
the marketplace—believes that the Kindle Fire “likely leverages design elements
and component selections from the PlayBook tablet by Research In Motion.” Taiwan-based
Quanta Computer manufactures both those devices.
The Kindle Fire’s user interface is designed for easy access
to Amazon’s multimedia content, including books and movies. The device is
equipped with a Gorilla Glass-toughened screen, a 1GHz dual-core processor, 8GB
of internal storage and roughly eight hours of battery life. Amazon Silk, a
mobile Web browser developed in-house, leverages Amazon’s EC2 cloud (in
addition to the tablet’s hardware) to speed Website rendering.
The big question now is whether the Kindle Fire’s presence
on the open market will negatively affect sales of other tablets, including
Apple’s iPad and the growing legions of Google Android devices. Some pundits
are arguing that more than enough room exists in the marketplace for the iPad
and the Kindle Fire to peacefully coexist side-by-side, particularly if people
treat the iPad as a laptop replacement and the Kindle Fire as a multimedia
peripheral along the lines of the iPod.
However, others are predicting a tooth-and-nail battle
between the various tablet manufacturers for supremacy. If that comes to pass,
Amazon will almost certainly prove a formidable competitor thanks to its
immense marketing budget.
Days after unveiling its Kindle Fire tablet, rumors also erupted about Amazon
potentially acquiring Palm.
Citing an anonymous and “well placed” source, VentureBeat
claims the online retailing giant “is in serious negotiations to snap up Palm
from HP.”
Former Palm CEO Jon Rubinstein, who joined HP once the
latter snatched up his company for $1.2 billion in 2010, currently sits on
Amazon’s board of directors. HP had used Palm’s webOS operating system,
previously used for the Palm Pre smartphone, as the software foundation for its
TouchPad tablet. However, HP decided to end TouchPad production in the wake of
anemic sales, putting Palm’s future in doubt.
However, Palm’s patents might prove useful to Amazon, given
the intellectual-property lawsuits zinging around the tech world these days.
Follow Nicholas Kolakowski on Twitter
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