Amazon's Kindle Fire Achilles Heel: Business Users

Amazon's Kindle Fire will challenge Apple's iPad and other tablets in that space, but adoption by companies as a business device could prove a nonstarter.

Amazon's Kindle Fire tablet, due to start shipping Nov. 15, will almost certainly rack up significant consumer sales.

The biggest question is whether the Fire, by presenting a viable touch-screen alternative to the iPad, can succeed where so many other Android-based tablets have failed. Nearly two years into its sales run, Apple's tablet continues to dominate the market, while successive "iPad Killers" have arrived on the scene only to promptly expire amidst withered expectations. Some analysts believe the Fire, backed by Amazon's considerable branding presence and marketing muscle, will sell millions of units in its first quarter of release-instantly passing the sales totals of the Motorola Xoom, Research In Motion's PlayBook and other contenders.

However, the iPad-and other tablets on the market-may yet retain an advantage over the Kindle Fire: they double as business devices, with an increasing presence within many companies. In quarterly earnings calls, Apple executives have cited the iPad as a tool deployed with rising frequency within Fortune 500 firms, even as third-party developers rush to create productivity apps for the iOS, Android and PlayBook platforms.

Employees may have a hard time persuading their bosses and IT administrators that the Kindle Fire can carry similar weight within the enterprise. Amazon's marketing efforts highlight the Fire's ability to play movies and music, display e-books, and run programs via its branded app store. The user interface, a heavily modified version of Android, is designed explicitly to place the user in Amazon's playground as fast and seamlessly as possible.

To Amazon's credit, the company isn't trying to push the Fire as a business device-aside from nods to built-in email and the ability to read documents. But its emphasis on the consumer market, and on its functionality as a media device, could drag on its ability to compete with those tablets aimed squarely at both the consumer and business markets.

Shopping and reviews Website recently sampled some 1,000 online individuals about their opinion of the Kindle Fire, which facilitates streaming video and downloading e-books from Amazon's online store. Of those surveyed, some 44 percent said they'd consider purchasing "a 7-inch tablet made by Amazon" over Apple's iPad 2. Another 44 percent said they "didn't know enough about the Amazon tablet" to make that decision and 12 percent said "they'd still buy an iPad."

However, Retrevo also found that the Fire faced some significant branding issues.

"The Amazon Kindle is a strong brand and a popular e-reader," Andrew Eisner, the Website's director of community and content, wrote in a Nov. 9 research note. "However, it looks like Amazon may have to spend some marketing dollars if it wants consumers to perceive Kindle as a tablet, too. In this study, which was conducted after Amazon announced the Fire, the majority of respondents (35 percent) thought the Kindle Fire was an e-reader."

As the Fire's release date nears, Apple is making a show of remaining unconcerned.

According to Barclays Capital analyst Ben Reitzes, Apple CEO Tim Cook and CFO Peter Oppenheimer suggested in a sit-down that the Kindle Fire, and its radical deviation from the "standard" Android user interface, represents a big step in the fragmentation of Google's mobile operating system.

"The more fragmentation, the better, says Apple, since that could drive more consumers to the stable Apple platform," Reitzes wrote, as quoted by Business Insider. "We believe that Apple will get more aggressive on price with the iPad eventually but not compromise the product quality and experience."

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